Analysing Innovation and Commercialisation at Essence Drinks

This report provides a detailed analysis of innovation and commercialisation strategies, focusing on Essence Drinks, a beverage company located in London. It compares innovation and invention, highlighting the importance of innovation for organisational growth, relevance, and differentiation. The report explores how organisational vision, leadership, culture, and teamwork shape innovation and commercialisation within Essence Drinks, emphasising participative leadership and a motivating work culture. It examines various sources of innovation, including market structure, competition, and changing perceptions, and discusses how innovation is developed, embedded, and measured. Furthermore, the report applies the innovation funnel and 4P's of innovation (product, process, paradigm, position) to Essence Drinks, evaluates frugal innovation, and addresses the commercial funnel and new product development. It also builds an innovation business case for Essence Drinks, including funding strategies and methods to measure effectiveness, and evaluates tools for developing, retaining, and protecting knowledge and intellectual property. The report concludes with a critical evaluation of the nature of innovation and provides evidence-based judgements on overcoming challenges to achieve successful innovations.

Unit 8 Innovation and
Commercialisation
Part 1 and Part 2

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
P1 Explain innovation and determine its importance to organisations in comparison with
invention.................................................................................................................................1
P2 Explain how organisational vision, leadership, culture and teamwork can shape innovation
and commercialisation............................................................................................................3
M1. Different sources of innovation......................................................................................3
D1. Critically analyse how innovation is developed, embedded and measured....................4
TASK 2............................................................................................................................................4
P3. Use of innovation funnel and 4P's of innovation.............................................................4
M2. Analyse and apply the innovation funnel........................................................................6
P4. Developments of frugal innovation and examples...........................................................6
M3. Appraise the role of frugal innovation............................................................................7
D2. Produce the financial reports...........................................................................................7
PART 2............................................................................................................................................7
TASK 4............................................................................................................................................7
P5. Commercial funnel, its importance and application of NPD...........................................7
P6 Build an Innovation Business Case for an organisation, including ways to access
funding...................................................................................................................................9
M4 Build a detailed Innovation Business Case which includes how to measure its overall
effectiveness using appropriate techniques available to test, iterate and improve:-....10
P7 Evaluate the different tools that organisations can use to develop, retain and protect
knowledge and intellectual property................................................................................11
M5 Present supported evidence-based evaluation of these different tools in the context of
the wider business environment........................................................................................11

D2 Critically evaluate the nature of innovation and the context in which it isdeveloped,
providing evidence-based judgements on how organisations can overcome challenges to
develop successful innovations..........................................................................................12
CONCLUSION..............................................................................................................................12
P6. Produce in innovation business case and methods to access funding............................13
M4. Produce a detailed innovation business case which shows its effectiveness using suitable
techniques.............................................................................................................................13
P7. Several tools that used to develop, retain and protect knowledge and intellectual property.
..............................................................................................................................................13
M5. Present supported evidence based evaluation of these various tools............................13
D3. Critically evaluate the innovation’s nature and the context in which it is created and
catering evidence based judgements....................................................................................13
CONCLUSION..............................................................................................................................13
References:.....................................................................................................................................14

INTRODUCTION
Innovation refers to the formulation and execution of new ideas and thoughts for the
purpose of maximization of value of business organisation along with the constantly maintaining
the satisfaction level of customers. Commercialization is defined as the set of wide process of the
innovation. In order to meeting the competition in the market the organisations are required to
implement several of changes in their existing policies. Commercialisation is the process of
transformation of ideas, invention or knowledge into the higher wealth for the people, business
or the society at huge level. The introduction of new product or services in the market can be
possible by the involvement of several key functions of organisation which include production,
marketing, distribution, sales and others for the purpose of achieving organisational growth and
success in the market. The chosen organisation for this report is Essence Drinks which is offering
several of drinks to the customers. It is located in London, United Kingdom. This report cover
the comparison of innovation and invention along with their importance, role of leadership,
vision, culture & teamwork shape innovation, 4P's of innovation, innovation funnel & frugal
innovation. Along with this, it also deal with the importance of commercial funnel, new product
development process innovation business case and tools of intellectual property.
TASK 1
P1 Explain innovation and determine its importance to organisations in comparison with
invention.
The meaning of innovation is renew. In simple words, it means to do improvisation or
replacement of something. It is defined as the process under which new process, idea or method
has been applied on the existing products or services for the purpose of creating new value out of
it.
Invention is defined as the unique process or method which is related to the product
development process and entire engineering. The changes in the product has been take place
because of the improvement in the machines or any process of production.
The importance of innovation in the context of Essence Drink are given below: It helps in growing the company: Innovation leads to the growth and success of
business organisation by making such objectives which fulfil the requirements of the
innovation. It help[ the organisation in meeting the competition by making innovation
1

on constant basis. It may be a time consuming process but it always result in the growth
of organisation. Essence Drinks is innovating the Mango Lassi which help the
organisation in attracting the costumes which leads to the growth of business. It keeps organisation relevant: It has been found that marketing keep changing
because of their dynamic feature. It is found as necessary for the organisations to adopt
the changes on time so that they can adopt the changes in the market instantly.
Innovation also work for bringing the changes in the business firm and capture high
share. Essence drinks is constantly bringing the changes in their organisation by
innovating the new drinks as per the needs of customers which help them in sustaining
and staying relevant. Innovation helps in making differentiation: In order to meeting the competition in the
market, the organisations are required to bring something different which can
differentiate them from others. Essence drinks are doing innovation by bringing several
of new drinks which also result in the attracting and retaining the customers in the
organisation.
Basis Innovation Invention
Meaning It refers to the process of forming
and executing the new ideas for the
purpose of maximizing the values
along with maintaining the interest
of customers towards the
organisation.
It is defined as the process of
creation of product for the first
time.
Generalization It is related to the practices of
doing some changes in the current
product.
It include the introduction of
completely new product.
Skill Technical, strategic and marketing
skills.
It can be considered as a scientific
approach.
2

P2 Explain how organisational vision, leadership, culture and teamwork can shape innovation
and commercialisation.
It is necessary for the organisations to perform several activities for the purpose of
achieving the organisational goals and objectives so that they can survive in this competitive
market. Essence Drink is using several of elements such as vision, culture, leadership and team
work for the purpose of giving shape to the innovation and commercialisation. These elements
are discussed below in the context of Essence drinks:
Organisational Vision: The long term objectives of organisation have been denoted by their
vision statement. The vision of an organisation has been prepared at the time of start up and the
organisation work for it. The vision statement of Essence drinks is to offering such menu to the
customers which provide a variety of seasonal products. It state that the company is engaged in
presenting something new to the customers in order to attracting the customers towards the
organisation.
Organisational leadership: It is defined as the way or manner in which the leaders of
organisation lead the team for the purpose of achieving the goals and objectives of organisation.
It has been found that the leaders of Essence Drinks are leading their teams in an effective
manner with the sole objective of attracting and retaining the customers. At the work place of
Essence drinks, leaders are following Participative leadership style. It helps the organisation in
listening the ideas of each and every employee which result in effective innovation. It result in
the best innovation which attract the customers towards the organisation.
Organisational Culture: Culture is defined as the collection of values, experience and belief
which guide the employees to perform proper and in effective manner. The culture at the work
place of Essence Drink is highly motivating which motivate the employees to give their best
performance at work place. It is really helpful in bringing the innovation ideas into reality as
highly motivated employees always work in an effective and efficient manner.
M1. Different sources of innovation.
Several of sources of innovation have been examined from the above discussion which
include market structure, necessity, competition, changing perception and many more. These are
the factors which influence the organisation for taking the mandatory steps which leads to the
innovation of products and services. Teamwork is also found as the important factor while
performing business operations in an organisation as it build a positive culture at work place.
3

Teamwork also help the business organisation to grab the opportunities by accepting the
challenges. It is also necessary for the management to adopt effective leadership style as it
motivate the employees for innovation.
D1. Critically analyse how innovation is developed, embedded and measured.
Innovation means to do some changes in the existing products and services and develop
them as per the requirement of customers available in the market. Any organisation should bring
innovation in their business as it leads to gaining the competitive edge along with achieving the
organisational goals and objectives. In order to build the innovative surroundings, business
organisation should develop innovation along with embedded. The success of innovation can be
measured with past, present and future performance of business organisation. In the same
manner, the performance of Essence Drink of past, present and future have been analysed for the
purpose of measuring innovation.
TASK 2
P3. Use of innovation funnel and 4P's of innovation
Innovations is defined as a process which is related to the creation of new ideas which bring
changes in the products and services offered by a business organisation. There are 4P's of
innovation which are included in the innovation mix. Below mentioned are the brief description
of 4P's of innovation: Product: essence Drinks is majorly focusing on the product innovation as it is related to
the attraction of customers towards the organisation. Innovation not only bring changes in
the products and services but it also add some values in it. The business organisations are
required to implement some incremental variations in their existing products for the
purpose of making them more attractive to their customers. Process: It is related to the changes in the process which the organisation is adopting to
offer their products to their customers. In the context of Essence Drinks, the management
of organisation is bringing the changes in the procedure of producing lassies. Paradigm: It is consider as the most important phase in innovation under which the
management of organisation have to identify the reasons of performing all business
activities. The managers of Essence Drinks determine the best method of conducting their
4

business so that their radical change become appropriate for all the members of
organisation.
 Position: This factor is related to the market where the organisation can deliver the
products and services. It also help them in making a good position in the mind of
customers. In order to making the position in the mind of customers, Essence Drink is
bringing innovation while providing lassies to the customers.
Innovation Funnel:
The innovation funnel is being used by the organisation for the purpose of implementing
or applying the new innovative ideas in the practical form. It can be defined as the execution of
creating new and innovative ideas by explaining the procedures by which an idea can be best to
use to offer the products and services to the customers. Below mentioned are the several steps
which Essence Drinks can implement the ideas into action: Ideas and conceptualization: Firstly, the business organisation have to create the pool of
new ideas so that the management can select the best one option after a critical analysis.
For the same purpose, the management of Essence Drinks is required to provide proper
support to their employees so that they can provide more creative and new ideas of
innovation. For the purpose of developing new innovative ideas, brainstorming is
consider as the best exercise. Feasibility analysis: It is the process of bringing the best one ideas and eliminating the
others from the pool of ideas. It is necessary for the management of Essence Drinks to
check the feasibility of ideas which state the suitability with the goals and objectives of
organisation. Development of new raw material: It is an essential stage under which the business
organisation require to develop the raw materials according to the selected idea in the
process. This development of raw material is related to the process of critical analyses
while doing selection of ideas which the respective firm examine the benefits and
drawbacks of idea.
 Customer approval and trade: Under this level, the business organisation get the
approval or permit from their customers and start selling their goods and services in a
general manner. In the context of Essence Drinks, the management of organisation is
5

required to test their innovated product from their customers and after getting approval,
they are required to put in the market with some modification.
M2. Analyse and apply the innovation funnel.
Innovation Funnel is important for companies as it help them in implementing their plans
in physical action. Along with this, it is also consider as the mechanism which also develop the
procedures of effectively implement the plans into action at the work place of Essence Drinks for
the purpose of getting acceptance for each and every person. Majorly, it focus on the on the
satisfaction of customers by providing them innovative products. Essence Drinks is doing
modification in the taste and flavour of lassi for the purpose of improving their productivity and
profitability of organisation. Essence Drinks is applying the four step process of innovation
funnel for adopting the innovative products.
P4. Developments of frugal innovation and examples.
Frugal innovation is defined as a model which the business organisation apply to redesign
their product and services which the potential customers may consume for the purpose of
reforming the value chain. Development of frugal innovation is found as an important action for
the business firms as it leads to the increase in sales which also result in the enhancing large
market share. The main objective of this model is to creating the importance of money which is
necessary to grab the large market share. For the same purpose, the management focus on
reducing the cost of the products and making them affordable for customers and cover a huge
geographical area. It is necessary for Essence Drinks to do the cost effective innovation for the
purpose of achieving the organisational goals and objectives. It has been found that the practices
of frugal innovation is very important because of below explained reasons:
 Environmental limitations: This limitation have relation with water, climate or
energy as it enhance the demand for frugal innovation model of consumption and
production.
 Fast growing market: It involve growth and emergence of economy where the
demand of frugal product is high.
 New technologies: Bringing new technology in production process result in the
decrease in the costing along with the prices of some kind of innovation offers new
opportunities for frugal innovators.
6

M3. Appraise the role of frugal innovation.
Several of business organisations are aware regarding the importance of innovation as it
plays an important role in the growth of business in the market. It is necessary for business firm
to take frugal innovation into consideration for effective innovation. It is consider as the process
which leads to the reduction of costs of innovation. Along with this, it also help in eliminating
the unnecessary steps which are not in the use. It is recommanded to the Essence Drinks to take
the proper steps of innovation along with applying the cost effective strategy.
D2. Produce the financial reports.
Requirements Cost
Costs of fruits 4000
Machinery and Equipment 2000
Labour 1000
Production costs 2000
Advertising costs 1500
PART 2
TASK 4
P5. Commercial funnel, its importance and application of NPD.
Sales funnel is the another name of commercial funnel. This model generally focus on the
consumer focus marketing model under which the the trip of actual customers towards the
purchase of products and services have been illustrated theoretically. In 1898, this model was
formed by E. St. Elmo Lewis. There are three steps in this model i.e. top, middle and bottom. It
has been found that the business organisations use this model in order to understand the thinking
of customers. The importance of sales funnel is described as under:
 This model is helping the business organisation in selecting the effective marketing
strategy which is really beneficial for the organisation.
7

 With the help of this model company can relate their customers and operates their
business in their own language.
 In order to increase the sales, this model helps the organisation which also result in
pulling the organisation towards the desired result in a systematic manner.
Steps included in this model:
 Awareness: This step leads to the spreading of awareness of products offered by a
specific organisation in the society through the use of several methods of marketing such
as social media, advertising, word of mouth and many more. Essence Drinks can use
advertising and social media in order to promoting their products and providing
information regarding the products to the people of society.
 Interest:- after promotion the brand or product in the market, the next step is to develop
the interest of the consumer in their products. In this portion the organisation identify the
problems of the customer and their solution by doing the market research. At this stage
organisation focus on the various content like email campaigns, blog spot and many
more.
 Decision:- this step is closely related to the sales. In this stage the people start taking
interest in the company's product. This portion focus on the pricing option and the
packaging. For Essence Drinks, to make decision for purchase the prospect can undergo
sales page, calls etc.
 Action: in this this portion the purchase of the product has been done. The customers of
the Essence Drinks will visit the store and make its purchase.
New product development process:
The new product development process is a systematic process which guide the business
and entrepreneurs to came up in the market with customer orientation and excellent quality
product. In context to the Essence company the process has been discussed below:-
 Idea generation :- this step is totally related to the ideas which is collected from the
personnels of the company, so that innovative product can be developed. On relation to
the Essence Drinks, the idea for an innovative product has been collected from their
employee as well as from stakeholders.
8

 Idea evaluation :- in this stage the best idea has been selected from the pool of different
ideas and other will filtered out which are of no use.
 Concept definition :- In this stage different types of factors has been comprises like
technical feasibility, product design, target market and many more.
 Strategic analysis :- The idea which have been selected by the company has been taken
into consideration and identified that whether this ides is fit to the business plan or
not(Dincer, 2017). The management of the Essence Drinks effectively determine the
cost, price, demand etc. of the Mango Lassi in order to convert the innovative idea into
reality.
 Product development and testing :- in this stage the product has been developed so
that testing can be done in a very effective manner.
 Market testing :- in this stage the testing of the product and the testing of the suggested
market has been done. For Essence Drinks, this included the best timing and best
methods of advertising.
 Commercialisation :- the price of the product and marketing plan has been developed to
promote the Mango Lassi in the target market.
 Product launch :- after applying all the marketing techniques, in this stage the product
which have been developed by the Essence Drinks company has launched in the market.
P6 Build an Innovation Business Case for an organisation, including ways to access
funding.
Business case is being considered as a blueprint for the company which help them in
developing a excellent business plan in relation to development of the new concept and new
offerings. It also help the company in determining the expenditure, potential risk and perks
which is associated with the development with appropriate reason and explanation. In context to
the Essence Drinks following are the necessary elements which incorporated in the business case
has been discussed below:-
 Executive Summary:- the Essence Drinks is going to launch a new product in the
market which name as Mango Lassi. This drink is with full of nutrients and energies the
customer.
 Problem:- Maintain the level of nutrients within the drink and along with this reduce the
level of sugar which is highly appealing to the customers.
9