Innovation and Commercialisation: Exploring Strategies and Processes

This report delves into the multifaceted concepts of innovation and commercialisation, examining their significance within an organizational context. It differentiates between invention and innovation, emphasizing the importance of organizational vision, leadership, culture, and teamwork in shaping innovative outcomes. The report explores various types of innovation, including the four 'P's of innovation (Product, Process, Paradigm, Position) and the use of the innovation funnel. It also covers frugal innovation, providing real-world examples. Furthermore, the report discusses the commercialization process, emphasizing the commercial funnel and new product development. It also includes the development of an innovation business idea and sources of funding. Finally, the report analyzes methods to protect intellectual property, detailing the advantages and disadvantages of each.

Innovation and
Commercialisation

Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY...................................................................................................................................3
LO 1Explain the context for Innovation and determine the difference between invention and
innovation........................................................................................................................................3
P1 Explain innovation and determine its importance to organisation in comparison with
invention.................................................................................................................................3
P2 Explain how organisation vision, leadership, culture, teamwork can shape innovation and
commercialisation...................................................................................................................5
LO 2Explain the different types of Innovation................................................................................6
P3 Explain four ‘P’s of Innovation and explain use of innovation funnel to examine and shape
innovative ideas......................................................................................................................6
P4 Explain developments in frugal innovation and provide examples of how it is used in
organisational context.............................................................................................................7
LO 3Discuss the process required to commercialise innovation.....................................................8
P5 Define the importance of the commercial funnel and application of new product
development for commercialisation of innovative offerings..................................................8
P6 Build an Innovation Business idea for an enterprise along with sources of funding to
finance the innovation............................................................................................................9
LO 4Evaluate the distinct range of ways to protect innovative ideas with advantage and
disadvantage of each......................................................................................................................10
P7 Analyse the different tools which an organisation can use to develop, retain and protect
intellectual property and knowledge....................................................................................10
CONCLUSION..............................................................................................................................12
References:.....................................................................................................................................13
Books and Journals...............................................................................................................13
1

2

INTRODUCTION
The concept of Innovation emerged as the competition in a market space have enlarged and
penetrated. Each and every organisation is striving to outperform their rivalries from a market by
offering products and services in better way with additional value and quality. The aim of
companies is to capture the large market share, earn profit and look forward for a potential
opportunity to grow and succeed. Innovation is the process of converting imaginary ideas into a
reality through creation, modification or improvements in the products, services and process of a
company (Chryssou, 2020). Innovation is something different and unique its approach that never
have heard, seen or happened before. Innovation and commercialisation bring revolution into the
industry and gives a 360 degree turn which changes the way of doing business, dealing with the
customer, design and development of product and drastic change is knowledge and expertise of
employees. Essence drink was founded by Akshay Kumar, a leading actor in Bollywood
industry, with an innovative product of healthy mango lassi. The below mentioned report covers
types of innovation, difference between invention and innovation and commercialisation of
innovation.
MAIN BODY
LO 1Explain the context for Innovation and determine the difference between
invention and innovation
P1 Explain innovation and determine its importance to organisation in comparison with
invention
Invention: Invention is defined as the ability of an inventor to look beyond the impossible
and look out for the new possible opportunity. Inventions cannot takes place without
creativity of an Inventor who have the capability to think different and out of the box and
change the world completely with the ideas which have not existed before (Atta-Owusu,
Dahl Fitjar and Rodríguez-Pose, 2020).
Importance of Invention to organisation
3

 Invention is the process where novel device, methods or process is developed which have
not existed even before helps in creating a brand image of a company and stand off from
different from others.
 Invention helps the company in developing and coming with a new and unique ideas so
as to maintain its presence in a market environment (Mohamed and et. al., 2020).
Innovation: Innovation is defined as the process undertaken by an individual or an
organisation with the objective of developing a new products and services to meet the
changing needs and wants of customer or tailoring existing offerings of a company with more
advance quality and value for existing and new customers.
Importance of Innovation
 Innovations helps company to review and revise their products, services, or process to
keep up the pace with changes in the market to be relevant and competitive at the same
time.
 Another significance of innovation in business is that it open a wide array of possibilities
for growth and expansion in national and overseas market both.
Difference between Innovation and Invention
Basis Innovation Invention
Meaning and concept Innovation is practical
implication of idea into
product or services for the first
time with additional value.
Invention is occurrence of idea
for creation of new and unique
products or process which
have not happed even before.
Competitive strategy Innovations may take place
into an industry and enter into
a market even more innovative
approach, where there is high
competition (Higham, De
Rassenfosse and Jaffe, 2021).
Inventions occurs in Blue
ocean market space where
there in low competition and
threats of new entrants.
Activities Innovation has a wide and
broad application of activities
into entire organisation.
Whereas, Invention has
limited scope of activities and
takes place only at Research
and Development department.
4

P2 Explain how organisation vision, leadership, culture, teamwork can shape innovation and
commercialisation
Commercialisation is the process of bringing Innovative ideas into reality through
launching and introducing new or customised products, services, or processes to the target
customer. There are numerous key elements which together form and execute process of
commercialisation for instance, production of products or services, channels of distribution opted
for accessibility of customer, marketing strategy for communicating with target market group,
actual sales of products via online or physical stores and customer support to conclude sales
process and ask for customer experience (Namdarian and Naimi-Sadigh, 2018).
 Vision: Each and every organisation have a vision or long term objective for which
company have formed and conducting its business operation. The vision of Essence
drinks, formed by Akshay Kumar, is to enhance the sales and competitiveness of the
company which had declined due to the emergence of new competitors in the market with
a same concept of offering healthy and cool beverages. The vision of company is to
develop another innovative product which proved to be unique than earlier with more
added value. The vision act as a guide and direction to be followed to achieve a long term
objective of business. Leadership: Leadership can be defined as the art of encouraging the workforce of an
organisation and lead them towards the common objective. Vision and leadership are
parallel to each other as leaders are responsible to guide and instruct the workforce team
of a company to work towards the common goals in a unified and cooperative manner.
Strong leadership skills and their positive behaviour determine the way how team
members works towards the common goals. To attain a vision of Essence drink it is
essential to have strong bond and relationship with the employees based on mutual trust
and confidence. Culture: Culture of an organisation have a significant impact over how an individual
within think, behave and respond in an organisation. Having positive and creative
working environment at Essence Drinks stimulates each employee to think and work in a
creative manner to find an adequate solution for company to deal with the challenges and
unforeseen difficulties (Styhre, 2018) (Kleyn, 2020). Additionally, work culture affects
5

overall performance of an employee as positive and healthy work culture boost the
motivation level of an employee and increases customer loyalty. Team Work: Success cannot be attained with an efforts of an individual rather as joint
efforts. Leaders must develop a work culture which encourage team work and develop a
spirit of unity among the team members of an organisation. Unified and jointly efforts of
a team will help Essence drink in attaining its vision and mission in an efficient manner.
Active participation of an employees in decision making develops a sense of unity and
commitment.
LO 2Explain the different types of Innovation
P3 Explain four ‘P’s of Innovation and explain use of innovation funnel to examine and shape
innovative ideas
Four P’s of innovation helps in developing and formulating innovation strategy to have a
clear idea and view of the path to be followed to attain business innovation objective
(Lasambouw, Sutjiredjeki and Nuryati, 2020). The Four P’s of innovation are product, Paradigm,
Process and Position which are briefly explained below: Product: This “P” serves to the category of innovation in products and the ways company
make a new or existing products with the help of new techniques and methods.
Innovation of a product takes place when a company, here Essence drinks, develops a
new product or make necessary adjustment to the current product with more value to the
customer as per their choices and tastes. Process: Essence drinks consider the process or procedures for producing new products
or making necessary adjustments to the current offering to add more value and to
improve the efficiency and profitability of a business firm. The main objective of process
innovation is to make the operational activities faster, cost effective, efficient and
produce goods with greater quality. Paradigm: Paradigm Innovation is concerned with the ways to improve the techniques of
business. This type of innovation help Essence drinks in revealing information with
regards to how and what changes should be made in current offerings to promote
innovation (Gancarczyk Najda-Janoszka and Gancarczyk, 2020).
6

 Position: Positioning Innovation is regarded as positioning the company’s offerings into
a new market with new products and services. Essence drinks with position innovation
target the new market which have not been targeted before with the new features in
existing offerings or completely new products to the new market segment.
Use of Innovation funnel in shaping and examining ideas
Innovation funnel is a tool which help organisation in getting constant ideas to check the
viability of each and select the best to develop an innovative strategy to attain success. The
innovation funnel starts with gathering more and more information so as to get more ideas and
expand the possibilities of innovation (Chauhan, Vargas-Sánchez and Moral-Moral, 2018).
Essence drinks can collect information from various sources such as competitors, partners,
research etc., but before that clear objective must be developed which will guide in getting right
information. Subsequently, ideas generated at initial stage are screened keeping in mind goals of
innovation and evaluation should be done on the basis of cost, risk, profit and derived value from
these ideas. Testing of products also takes place at this stage, and at last stage Essence drinks
ensure that selected idea matches the vision of company and commercialisation of product takes
place if everything goes as planned.
P4 Explain developments in frugal innovation and provide examples of how it is used in
organisational context
With the rapid growing population, depletion of resources, deteriorating impact over
environment, technological advancements, rise in the demands of people, unaffordability of
products, inaccessibility, and unsatisfied needs of a target group have aroused the need for frugal
innovation. Frugal innovation is based on the concept of making a products or services more
affordable, accessible and durable for a large number of people. It is the concept of
commercialisation of products and services within a limited number of resources delivering
exceptional quality and value to the customer with less impact over planet, people and natural
resources (Pannen, Wirakartakusumah and Subhan, 2019). Essence drinks have come up with a
healthy drink which is a “mango lassi” designed for a people in UK who are looking for a
healthy beverages in summer rather than a carbohydrate drinks. The brand was developed by
Bollywood leading Star who is well known for his healthy and dietary habits. The company soon
got recognition and was welcomed by large number of people in UK as it was affordable and
having a less impact over environment through its production process.
7

One of the significance of frugal innovation is it helps to reduce cost of production in
developed countries like Europe where the fastest growing market have compelled to opt for a
frugal innovation. Another advantage is the environmental constraints like climate changes,
wastage of energy and water have also promoted the use of frugal innovation.
LO 3Discuss the process required to commercialise innovation
P5 Define the importance of the commercial funnel and application of new product development
for commercialisation of innovative offerings
Sales funnel consist of four steps which describes the decision making process of potential
customer at each step, what they think and how their decisions are influenced (Reyneke
Shuttleworth and Visagie, 2021). With the help of sales funnel Essence drinks designs and
develop right marketing strategies to as to communicate with the prospect customer and
turn into a paying customer.
 Awareness: At this stage customer is informed for the products and services Essence
Drinks is offering through word of mouth, advertising or social media. Customer
identified the solution to their problem at this stage. Interest: Based on the level awareness, prospect customer evaluate the benefits and
values offered by Essence drinks as a solution to their needs, that is healthy mango Lassi
to the people in UK. Based on their interest level, customer conduct research and finds
more about the product. Decision: This stage is crucial where customer with the information in his hand compare
the products with that of a competitor on the basis of pricing, features, benefits and
packaging. Being unique and innovative will help Essence drinks in being on the top of
list of preference and through calls, sales pages or webinar company can convert prospect
customer into paying customer (Gong and Peng, 2018). Action: This the stage where actual sales takes place. No matter customer makes a sales
or not Essence drink build a strong relationship and nurture campaign to stay in the mind
of customer.
New product Development for commercialisation Idea generation: Initial stage in a product development is getting idea and need to
develop a product or services through analyse the problem faced by customer. Essence
8

drinks identified the rise in demand of healthy beverages in UK due to the rise in healthy
consciousness. Idea Screening: The next step is to select a best alternatives from initial stage which
matches the need of customer and goals of an organisation at the same time (Gong and
Peng, 2018). Concept development and testing: Best selected ideas are then converted into reality
though developing a concept, concept of all over product, features, size, shape and cost,
then tested on a target audience to check its viability. Development of marketing strategy: Marketing strategy consist of several aspects such
as, target market, value preposition, sales, market share, price of a product, distribution
channel etc. Business analysis: After developing a concept and marketing strategy, a detailed analysis
of business is conducted to check whether business objectives are met with regards to
cost, profit and target sales. Product development: If everything goes well as per the business objective, product
concepts are converted into reality taking a physical form. Test marketing: At this stage Essence drinks test the product and marketing strategy on a
realistic market such as segmenting, targeting and positioning of target group,
distribution of channels, advertising, packaging material etc. Commercialisation: Finally, product of Essence drink is introduced in market with
expected value and benefits followed by success of all the above stages.
P6 Build an Innovation Business idea for an enterprise along with sources of funding to finance
the innovation
Essence drink have developed a classic mango lassi which is healthy for those people who
take health as their priority. Moreover, this drink can be used by any age group person as it
provides various benefits to the people and is also considered to be the alternative of any sweet.
The company is trying to come up with new flavours of lassi as new and innovative idea is
crucial for the business growth (Pannen, Wirakartakusumah and Subhan, 2019).
Vision: Essence drinks wants to be the largest brand of dairy industry and the first choice of
every consumer. They want to reach every consumer providing those healthy lassis which
includes various benefits. To reach as many countries with different and amazing flavours.
9

Mission: The mission is to utilise the raw materials effectively and of high quality. To use
unique supply chain in providing the best quality lassis with magnificent customer service and
authentic supply. To provide guaranteed delivery service of the lassis which will satisfy the
consumer demands.
Leadership: The leader approach is to motivate the employees for achieving the objectives of the
company in an effective manner. They are responsible to gather their teams and give them the
direction for achieving optimal performance (Acosta, Coronado and Martínez, 2018). As Essence
drink is now coming up with some unique drink the leader of the company is now focussing that
the quality is achieved and employees work with greater efficiency to achieve the company
innovative objective.
Culture: Every company has different culture and functions that has a direct link to company
performance. Essence drinks follows the flexible and friendly environment inside the company
as they know satisfied consumers would be able to achieve the objectives of company in an
effective way.
Sources of funds: Essence drinks have taken funds from various sources to grow their business.
Some of the sources are explained below-
 Crowdfunding: This platform is the facility which provide the owners to raise funds from
various investors in small quantity. By this the company is able to finance the new
innovative ideas which they will take and will be able to expand the business.
 Business angels: Angels includes the wealthy people or entrepreneurs who invest in the
company innovative idea with the motive of earning return of about 10-20%. These
people provide guidance and direction to the owners of the company.
 Venture capital: They invest usually higher than the angel investors into new start-ups or
for expanding the business. Essence drink takes help form such venture capitalist to
finance their company (Nitzsche, Wirtz and Göttel, 2019).
10

LO 4Evaluate the distinct range of ways to protect innovative ideas with
advantage and disadvantage of each
P7 Analyse the different tools which an organisation can use to develop, retain and protect
intellectual property and knowledge
Intellectual property rights can be defined as the legal rights provided to the creators of the
artistic work or inventors with the objective of protecting their original work from theft
reproducing the work. The prime objective of intellectual property is to encourage the inventions
or other artistic work which leads to the economic growth. These property rights generate the
incentives for individual to produce the things that in turn create job opportunity and
development of new technology. Various tools are their which can be used by Essence Drinks to
protect their innovative and new idea which are explained below:
Patents: Patent is the right which is given to the inventor who have made the new inventions. In
this the owner of the invention has the right to choose how others can use their invention or
whether the any right has to be given to other person to use the invention (Chryssou, 2020).
Advantages of Patents Patent gives entire right to the inventor to decide whether the other person can use their
invention or not. The patent owners gets the monopoly in the market about their new invention or any
innovation for a certain period.
Disadvantages of Patents To acquire patent by the owner is a difficult process as it involves lot of documentation. The patent is for only certain time of maximum period of only 20 years.
Copyright: Copyright is the right which is given to the owner of any literary work, artistic, book,
movie etc. These right could be used to replicate their own work, to perform and show their
artistic work and to either distribute their work to other parties.
Advantages of Copyright
 The owners have the right to distribute their copies or allow other person to reproduce
the same copy (Atta-Owusu, Dahl Fitjar and Rodríguez-Pose, 2020).
 Copyright give the right to owners to protect their data or work from being fraudulently
exploited or stolen by other.
Disadvantages of Copyright
11