Report on Innovation and Commercialisation: Essence Drink Business

This report provides a comprehensive analysis of innovation and commercialisation, using Essence Drink as a case study. It begins by differentiating between innovation and invention, highlighting the importance of innovation for Essence Drink. The report then explores how organisational vision, leadership, culture, and teamwork shape innovation and commercialisation. It examines the 4 Ps of innovation (product, process, position, paradigm) and the innovation funnel. Furthermore, the report discusses frugal innovation with examples and the importance of the commercial funnel, including the application of New Product Development (NPD). A business case for Essence Drink is built, and various tools for developing, retaining, and protecting intellectual property and knowledge are presented. The document is available on Desklib, a platform offering a wide range of study tools and resources for students.

UNIT 8- INNOVATION AND
COMMERCIALISATION

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................3
P1 Innovation and its importance in comparison with invention................................................3
P2 The way organization vision, leadership, culture and teamwork shape innovation and
commercialization........................................................................................................................5
P3 4 PS of innovation and use of innovation funnel to examine and shape innovative ideas.....6
P4. Development of the frugal innovation with examples..........................................................8
P5. Importance of commercial funnel and application of New Product Development (NPD). . .9
P6. Building up the innovation business case for Essence Drink..............................................11
P7. Various tools for developing, retaining and protecting the intellectual property and
knowledge..................................................................................................................................13
CONCLUSION..............................................................................................................................15
REFERENCES..............................................................................................................................16

INTRODUCTION
Innovation is process of improving the existing products and services of company so that
new customers can be easily added within the organization. In recent scenario, with increase in
level of competition, more and more companies are trying to differentiate its existing products
and services so that it can earn more profitability and market share in long run. Essence drink is
company that has been started its operations two years ago, that has launched an healthy mango
lassi in UK market that resulted in increasing overall sales and profitability of company (Dincer,
2017). So, this report has contained crucial detail pertaining to innovation, its importance, the
way organization vision, mission and leadership lead in shaping the innovation and
commercialization. Moreover, it has also included 4ps of innovation, frugal innovation and new
product development that helps in commercialization of innovation etc. At last, it has covered
different tools that are used by the company to develop, retained and protect intellectual property
and knowledge for benefits of organization.
P1 Innovation and its importance in comparison with invention
Innovation is an important process that has been undertaken by the Essence Drinks to
renew its existing products and services or new process to delivered products to customers so
that maximum value can be provided to end users. On the other hand, invention means that
company is planning to launch a complete different product in order to fulfill unsatisfied wants
of people that are living in society. So, innovation is just act of changing existing product while
invention is introduced of new products range with an motivate to attract existing as well as new
customers in the firm. In addition to this invention requires scientific skills so that individual is
able to find new and different method that could be used to meet customer's expectancy (Dincer,
2017). While, for innovation, only marketing and technical skills are required so that changes or
improvements made in existing products and services can be aware to customers for benefits of
organization. Therefore, the reason why innovation is important as compared to invention for
Essence drink can be illustrated in detailed as follows:
1. Positive impact on company culture: The first and foremost benefits that company
might get through bringing innovation within the firm is positive culture in which each
and every individual is highly motivated to be effectively performed. They are inspired
to identified innovative idea or method that can be used to delivered services to range of
customers for fulfillment of their respective desire. Thus, it helps in retaining highly

talented, experience and qualified employees within the organization (Huang, Farrukh,
C. and Shi, 2018).
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2. Enhance brand image of firm: Secondly, innovation is important as compared to
invention for essence drink as it helps in creating and building strong brand image of
company in mind and hearts of customer's. In another words, it can easily generate
awareness among people or attract them to try innovative or improved products in order
to satisfy their wants in the best possible manner.
3. Less costly and time-consuming process: Thirdly it is more beneficial or important in
context of invention for company because less time, cost is involved in making
improvements. While the company need to invest more time as well as money to find
innovative or new products that can be delivered to customer's so that they are motivated
to be part of it rather than other firm in market (Szutowski, 2019).
INNOVATION INVENTION
Innovation is something related to making
new things in existing products and services.
It is related to introducing of any new products
by the company.
Moreover, it increases business value thus
helps in adding more customers in the
organization.
Invention increase brand image and profitability
of firm.
P2 The way organization vision, leadership, culture and teamwork shape innovation and
commercialization
Innovation and commercialization are crucial process that helps in expansion and growth
of firm in international and domestic market. Organization vision, leadership, culture and
teamwork are various component that contribute in bringing innovation and commercialization
in the Essence drink so that it can retain competitive advantages. Therefore, the way all these
have helped in promoting the innovative ideas of company can be explained as follows:
 Organization vision: The main vision or objective of essence drink is “to enhance
customer's satisfaction level through delivering qualitative and more innovative services
so that they are motivated to be part of organization. So as per the vision, company have
tried to put its best efforts to make improvements or changes in its existing products and
services with an motivate to add more and more new and existing customer's in the firm.
Moreover, it has also helped in commercialization about the company and its innovative
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ideas to people so that it can enjoy higher return or outcome (Leone and Belingheri,
2017).
 Leadership: The another factor that has contributed in shaping innovation and
commercialization in the essence drink is leadership. As leaders are individuals that have
innovative or special capabilities to motivate employees to perform particular task in
specific manner so that best outcome can be achieved. Thereby the leader of Essence
drink through making use of transformation leadership styles is able to influence
employees to adapt the changes so that company can gain and retained competitive
advantages in external environment (Leone and Belingheri, 2017). It has also promoted
open communication or motivate individual to share their innovative idea or the manner
in which products and services can be promoted to customer's for benefits of
organization.
 Culture: The culture of organization also acts as factor in shaping innovation and
commercialization as essence drink have more friendly and healthy working culture that
helps staff member in completing the task in effective manner. Manager has also focused
on collaborating range of diverse people to work together as team rather than individual
thus it helps in learning, enhancing existing knowledge and bringing innovation in the
firm. Thus, such supportive, interactive culture and motivating has contributed in
influencing staff member to bring or develop innovative ideas that could be use by firm
to gain competitive advantages (Hutschenreiter, Weber and Rammer, 2019).
 Teamwork: Essence drink manager have range of employees that tried to cooperate with
each other, provide constructive feedback and avoid chance of conflict thus it has helped
them in working as an team for achievement of end goals. All member has ability to
effectively work in team thus it helps in improving the learning and existing skills,
knowledge and capabilities of individuals. Thereby they are able to find alternative or
innovative ideas that could be used by the firm to attract maximum customer's and build
strong brand image in external environment for longer time frame.
P3 4 PS of innovation and use of innovation funnel to examine and shape innovative ideas
Product, process, position and paradigm that are described by Tidd and Bessant 4 PS of
innovation that help company in promoting its innovative idea to people so that they are
motivated to purchase the product and services of firm. The way Essence drink can make use of
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4 Ps of innovation to enhance its overall profitability and market share. So, all the 4ps of
innovation can be explained in detailed as follows:
1. Product: This is first areas in which company needs to make innovation to attained its
set objectives as differentiate products and services helps in inducing more and more
individuals in the firm. Likewise, the essence drink through making changes in its
existing products and services or adding more ingredients is able to make employees
happy and satisfied to maximum extend.
2. Position: Company have focus on effectively position its brand image in mind and hearts
of customers through delivering innovative and more creative products and services to
end user. Thus it has tried to continuously improve its taste and quality of Lassi so that
people can enjoy them and fulfill their desire (Fernandes, Ferreira and Peris-Ortiz, 2019).
3. Paradigm: In this organization emphasis on making use of new model to delivered
services to customers such as essence drink has plan to make use of digital technology in
order to promote its new services to millions of people residing across United Kingdom.
4. Process: Moreover, the Essence drink manager has also ensured that company make use
of standard and systematic procedure and policies in order to complete the task or
delivered quick services to customers.
USE OF INNOVATION FUNNEL IN SHAPING INNOVATIVE IDEA
There are around six stages that are followed by the company to promote innovation in
society so that it can achieve the set objectives in minimum time frame. Such as:
 Opportunity assessment: The Essence drink manager needs to make efforts to analysis
and identified various opportunities that are present in external environment and the way
they can be useful for the firm.
 Insights-based ideation: The second step that need to be taken by manager is getting
more information or insight related to the idea that is whether it is useful or not.
 Conceptualization: In this stage the manager eliminates the ideas that are not much
useful and select the best among all the alternative opportunities for better growth and
success of firm (Huang, Farrukh and Shi, 2018).
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 Evaluation and benchmarking: Then the manager will set the benchmark or particular
standard so that the set action can be easily compared with actual performance for
better outcome.
 Plough on or cut it loose: At this stage the essence drink will take feedback from
customers related to whether they are happy with new or improve products and services
or not. Launch: It is last stage at which the company finally launch the products to meet
unsatisfied wants of customers and enjoy huge profitability (Leone and Belingheri,
2017).
P4. Development of the frugal innovation with examples
Frugal innovation is being defined as the concept which urges the business for
responding to the limitations of the resources and try to develop some innovative and creative
solution to those problems (Badizadegan and et.al., 2020). In this highly competitive world it is
very essential for the business to implement the frugal innovation to stand out from the
competitors and capture large market share. For Essence Drink as well it is very essential that
the business continuously try to innovate so that the business can grow and develop and sustain
the market. The major aim of undertaking frugal innovation by Essence Drink is to minimise the
cost so that maximum of the profit can be availed by the company. the major aspect relating to
frugal innovation is that this will improve the working condition of the company y and will also
attract the consumers in large number. This in turn will increase the sales of the company and
profitability and market share of Essence Drink will increase.
The major example of frugal innovation is of Sorghum beer, which was developed in
Africa and several companies including SABMiller and Diageo also followed the procedures
adopted by local home brewers for making beer. Under this the beer was made with help of
more affordable products like cassava and sorghum instead of malting barley for reducing the
cost. This in turn also resulted in reducing the cost of packaging by providing the product in
kegs instead of using bottles. This was the frugal innovation as it involves reducing the cost of
the product as well.
Hence in case of Essence Drink as well the company need to bring some frugal
innovation so that the business can grow and develop in proper and effective manner. Thus, for
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this reason the company need to follow and comply with the new product development process
so that they can identify the new pattern and trends among the consumers and develop a new
business idea.
P5. Importance of commercial funnel and application of New Product Development (NPD)
The commercial funnel is being defined as the marketing tool with help of which
company can find and trade their product and services with the consumers (Rasmussen and
Eliason, 2017). This funnels maps out the journey of the customer through which they go for
making any of the purchase. For Essence Drink it is essential that they undertake the use of the
commercial funnel to increase sales of company. this funnel is applied by the company in
following manner-
 Awareness- first of all the company tries to make the consumer aware that what the
company is providing and how they will be delivering the product or the service to the
consumers (Kim and Park, 2018). This is very essential because of the reason that if the
consumer will not be aware of the product or the service then they will not be buying it.
 Interest- the next step is developing the interest of the consumer towards the products
and service so that the consumer will buy the product and service. When the product or
the service will not be attractive then this will not attract the consumer towards the
product. Thus, here it is necessary for Essence Drink that they must develop interest
among consumer by providing better and effective outcome.
 Decision- under this stage the consumers decide to take the decision that whether they
have to buy the product or the service or not. Now in this stage the consumer is more
interested in taking advantage which is being provided by the company. hence, here the
company stimulates the buyer to decide for purchasing the product.
 Action- in the end the action is being taken wherein the potential prospect is being
converted into the buyer or consumer list of the company. hence, by taking an action the
prospect has been converted into a new customer which is beneficial for the company.
hence, this is an opportunity for Essence Drink that they must try to stimulate the buyers
in order to manage and maintain the consumer for the company.
This commercial funnel is very essential for the Essence Drink that they must effectively
comply with it. This is necessary so that they can attract the consumers towards the new product
of sugar free lassi. This is pertaining to the fact that when the commercial funnel will be used
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then this will attract the consumer to buy the product in large number resulting in increase in
sales of the company.
New product development
Along with commercial funnel, it is very essential for Essence Drink that they must also
try to follow the new product development (MIRGHAFOORI, MOROVATI and ZAHEDI,
2018). This is essential because the company wants to bring something new and for this they
will have to comply with NPD. The steps which will be followed under this process by Essence
Drink is as follows-
 Idea generation is the first stage wherein the company tries to generate the idea by
analysing the changes within the external environment or the problem of the consumers
(Five phases of the new product development process, 2021). Hence, in this stage
Essence Drink will try to analyse the external environment and develop idea.
 Screening is the next stage wherein the person tries to screen two or more ideas for
developing the business or new product. This is pertaining to the fact that when there are
two or more ideas then it is very essential for Essence Drink that they must screen the
ideas in order to analyse which one is better.
 Concept development is the next stage in which Essence Drink tries to develop the
concept relating to the idea which is being finalised in the screening stage. This is very
important for the company as if the concept will not be developed in proper and effective
manner then this will create issues for Essence Drink in developing new product.
 Product development is another stage within the new product development which
involves developing the product further. After analysing the concept, it is essential for
Essence Drink that they must develop the product so that it can satisfy the need of the
consumers.
 Commercialising and rolling out is the last stage wherein Essence Drink will try to
promote the goods and services within the market. This is very essential because of the
reason that if the product or the service will not be promoted then consumer will not be
having knowledge of the new product and sales of the company will not be much as
required.
Thus, it is also very essential for the Essence Drink that they must effectively make the
use of new product development. The reason behind this fact is that when the new product will
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be developed then this will definitely attract the consumer towards the new product or the
service being provided to the consumers (Jiao and et.al., 2018).
P6. Building up the innovation business case for Essence Drink
Mission
The mission of Essence Drink is to produce a type of lassi which does not have sugar that is
sugar free lassi.
Vision
The vision of the company is to create a product which will promote a healthy lifestyle and a
differentiated beverage especially for the health conscious people.
Need
In the current competitive era, the consumers have become much conscious relating to
their health and safety (Kadir and Shamsudin, 2019). Hence, the consumers do not wish to
consume the products which are unhealthy like the mango lassi which have immense sugar and
other added flavours and preservative. In addition to this, also the beverages containing sugar are
not good for the diabetic patient and because of this as well there was a need to develop sugar-
free lassi.
Competitive edge
The feature of sugar free lassi is the major feature of the lassi which will provide a
competitive edge to Essence Drink. The reason underlying this fact is that this product is majorly
for the younger mass and the diabetic patient. Hence, this will attract the large number of
consumers which will provide the company with competitive edge.
Market opportunities
The major market opportunity for Essence Drink is to attract the young segment of the
society so that the product can be liked by maximum of the people. In addition to this, the
current trend of the consumer for having healthy and organic product will be an opportunity.
This is pertaining to the fact that when this trend will be followed then automatically Essence
Drink will come up with a new and innovative product.
STP
Element Description
Segmentation The major segment selected for the sugar- free
lassi is based on demographic and behavioural.
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This is pertaining to the fact that this segment
involves a wide range of consumers which are
beneficial for company (Menna and Walsh,
2019).
Targeting The major target under the demographic
segment is the young people belonging to the
age group of 25- 45. In addition to this,
another target of Essence Drink is the diabetic
patients who are not allowed to consume much
sugar.
Positioning The major strategy for positioning the product
among the consumer it to focus on the quality
of the product (Henttonen and Lehtimäki,
2017). This is necessary because company
wants that whenever quality is mentioned then
consumer must only remember Essence Drink.
Marketing strategy
Under the marketing strategy, the major strategy selected by Essence Drink is to focus on
the social media marketing and digital marketing. This is very essential for the reason that use of
social media is very popular among the young people and if the new sugar free lassi will be
trending over social media then consumer will definitely buy the product. In addition to this,
different discount offers and combo offers will also be provided to the consumer so that they are
attracted towards the company.
Estimated budget
Particulars Amount (£)
Manufacturing expense 2000
Material cost 600
Labour cost 2500
Marketing expense 2000
Selling and administration 1500
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