Innovation and Commercialisation: A Report on Holland and Barrett

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Innovation and Commercialisation
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Table of Contents
Introduction.................................................................................................................... 3
LO1.................................................................................................................................. 4
LO2.................................................................................................................................. 8
LO3................................................................................................................................ 11
LO4................................................................................................................................ 15
Conclusion....................................................................................................................17
Reference list................................................................................................................18
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Introduction
Innovation defines as the mixture of current creativity and concepts in the shape of new
techniques and gadget. Company comes up with modern innovation for satisfy the
requirement and preferences of consumers and procure fiscal advantages from this
idea. Commercialisation is the activity regarding introducing new products in the mass
market along several steps like manufacturing, packaging, pricing and others. The
specified company is Holland and Barrett, which is a chain retailer shops located in 16
countries with more than 1300 stores across the world. Holland and Barrett has a
significant presence in the United Kingdom, which is also a leading health retailer shop.
This report will describe about the two important factors that is Invention and Innovation.
The part of supervision, culture and aim in forming innovation are represented here. The
report will explore the 4P’s of innovation funnel to explore shaping the ideas of
innovation (Cortimiglia et al., 2015). The steps of new product development and its
approach and the different types of innovation explained here. The report also display
the process required for commercialise innovation. The report explains about the frugal
innovation by focusing some examples. The several instruments that company uses is
to develop, maintain and to protect awareness and intellectual properties.
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LO1
Explain the context for innovation and determine the difference between
invention and innovation.
P1 Explain innovation and determine its importance to organisations in
comparison with invention
A creative idea leads to innovation. It is termed as victorious creative ideas executed
various fields. New ideas are originated through invention. Innovation is a chain of acts
which includes experiment, brainstorming, prototyping, observation, launching and
monotony. Innovation of services and products are done for monitory benefits or
commercialization whereas invention includes a creation of a new thing (Jensen et al.,
2016). Inventions and innovations distinguished on the following basis.
Basis of comparison Innovation Invention
Meaning Innovation includes
translation of language into
social comfort and growth
of economy. Innovation
involves a series of
organisational,
technological, commercial,
scientific and financial
activities.
Invention can be defined as
a process in which new
ideas are shaped into
products or services
according to the need of the
consumers
Requirement It requires capability,
knowledge about
technicalities, trends and
monetary support.
Monetary aids, knowledge
and capability are required
in invention.
Concept The ideas are applied
practically in innovation.
These are real ideas which
have not been appeared
before.
Skills Technical and calculated
expertise is required for
prosperous innovation.
Scientific skills are required
for successful innovation.
Occurrence Innovation is needed in an
organisation when there is
a need of improvement in
some services and
products.
Invention occurs when any
new idea is struck into
mind.
Activities Staff of the organisation
tries to make the innovation
successful by involving in
the process of innovation.
The responsibility of
invention of any product or
service is done by
Research and Development
department.
Importance  Innovation is very  It has made the life
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important for taking
the advantage of
movement of
entrepreneurship.
 Through innovation,
company or
organisation flows
with technological
expansion.
 Innovation is great
process to reply to
enlarged number of
customers’ choice
and conjecture.
much easier.
Everyone look at the
world with a new
aspect.
 New challenges and
requirements are
very obvious to be
faced in invention.
Example The innovation of LCD
televisions, flat screens and
smart phones have pulled
up the popularity.
The invention of cars,
steam engine, paper have
accomplished the need of
the customers.
Table 1: Difference between Innovation and Invention
(Source: Created by the learner)
P2 Explain how organisational vision, leadership, culture and teamwork can
shape innovation and commercialisation.
A company needs a vision to reach a goal in the future. Holland and Barrett has got the
vision which has enhanced the social kindness of the customers conveying the best
wellness products and effective supplements, etc with the higher quality and making the
customers satisfied through including innovation to the present products. Innovation is
not possible unless and until the employees are directed towards working with a vision
(Perkins et al., 2017). The senior executives have the responsibility of setting a vision. It
may change the main aim of the company. A vision, which is innovative, helps in
specifying the way of the presen business procedure and making the people understand
the importance of innovation. In addition to it, vision is supposed to be the start point of
metrics, plans and calculative objectives. The main performance benchmark of Holland
and Barrett was innovated from flow from the vision. The base of the innovation is the
change involved in attempting the company’s vision. Having a favourable vision allows
every individual to pass along a voyage of innovation. More control and power is being
given to the staffs of the organisation for working for the vision of the organisation.
The way, the leaders inspire and motivate their juniors so that they can come out with
new innovations for the company or the organisation. Breaking the old norms and
introducing the new ones is involved in the process of innovation. The employees
become more crystalline and recognise their own potential under a good leadership. A
good leadership also permits the staffs to challenge their juniors to think seriously and
find new ways. The leaders’ role is very important as they acts as agent of change for
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the business in terms of better operation and improving the performance. The leader
also allows the employees take chance without thinking of the consequence that begins
to a new service and product (Macdonald et al., 2017). The entrepreneurial behaviour,
ability to take the risk, opportunity pursuing attitude behaviour of the leader brings a
better innovation in organisation. In Holland and Barrett, the leader tries to communicate
with their followers to the ideas of the followers which may change entire process of
business. The leader introduces new ideas of commercialising a service or product to
run smoothly in the market. They introduce better plans to create consciousness in the
customers.
A better culture helps in encouraging open communication in all the departments. The
culture creates comfort where the employee feels that their viewpoint is taken seriously
in the organisation. Open discussion results in open innovation which keeps every
individual in the company to give their better ideas. A nice culture helps in creating a
cloud of plans and ideas, where the employees can provide ideas and commit mistakes
without really caring about the defeat. The culture of Holland and Barrett greets all types
of ideas introduced by the employees. It experiments all kinds of ideas through
commercialisation in the field of market. The organisation does not only introduce
innovation in the organisational operation but it has plans for honouring their employees
for creating the faith. In addition to that, the action of creativity is awarded by the
organisation. The better idea is considered for the procedure of commercialisation (Ax,
and Greve., 2017).
Teamwork is a very important aspect for innovation. In order to facilitate
commercialisation and innovation, the organisation always wants their employees for
working together as a team. Working in a team always permits everyone to recognize
the problems and their challenges. A numerous numbers of solution for a single issue
would create great advantage for company or organisation. The employees who are
working in a different team tend to share the ideas for supporting the commercialisation
and innovation. The spirit of association helps the company to produce the services and
products as per requirement of new generation. The process of commercialisation
needs a cluster of staffs that helps in pricing of the product, branding of the product,
packaging of the product and promoting of the product. Holland and Barrett performs
the tasks efficiently by promoting the teamwork (Putra and Fibra, 2016).
There are seven sources of innovation that adds importance to the process and they
are as follow:
The unexpected: Market research needs to be conducted on a regular basis by the
executives and managers of Holland and Barrett. This can utilise unexpected in the
organisation.
The incongruity: Customers are genuine area to find the incongruity. The hidden
needs and complaints of the customers act as a signal for the organisation for
innovation.
The process needs: The process involves acknowledging the weak areas and doing
the necessary steps to correct them.
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Industry and market structure: Some unexpected changes can be done in the
organisation or the market. Holland and Barrett needs to keep an eye on these
changes.
Demographics: Gradual change in the income levels, human capital, age range, and
population may result in originating new innovative plans.
Fluctuation in meaning and perception: The style of living of the citizen changes
from time to time. This enhances the company or organisation for producing new set of
products at different intervals.
New knowledge: The present knowledge, the skill, and the experience of the
employees of the organisation give birth to new plans and ideas.
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LO2
Explain the different types of innovation
Forms of innovation
Red ocean innovation
The innovation where organisation tries to discover a recognized market spot is called
as red ocean innovation. By bringing minor changes in service and product, Holland and
Barrett tries to grasp majority of market share.By minor changing of service and
product, Holland and Barrett tries to attire high share of market in an exceptional way.
Business model innovation
The business unit can use business model innovation by minor modification of capital,
profit formula, scheme, and processes. In this way, a business can reinvented.
Business model innovation helps Holland and Barrett to struggle with its competitors by
capturing arresting newly targeted market sector (Jensen et al., 2016).
Sustainable innovation
The business unit depends on this process for the development of products and
schemes. As a result, it is one of the most important forms of innovation.
Holland and Barrett focussed on 4P’s of innovation, which includes four important types
of innovation.
P3 Explain the 4Ps of innovation and explain the use of the innovation funnel to
examine and shape innovative ideas.
Product innovation
Product innovation includes changes in both schemes and products for Holland and
Barrett thus improving qualities. This is done by acquiring correct information from the
market place. The only goal of this business unit is to provide better services and best
qualities of product through required innovation.
Process innovation
The process by which, schemes, and products are manufactured, revised, and then
made available for the customers is known as process innovation (Hu et al., 2017). This
process includes changes in manufacturing process. The prime goal of process
innovation is to optimum the service value of products and schemes and decreases the
cost of production at minimal level. Substitute and non feasible process in the
manufacturing of product and scheme does not applicable in this innovation process.
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Position innovation
It is another important form of innovation, which helps customers in relocating services,
processes, and the insight of the active product. Position innovation also states the way
through which alternation could be made to services, packaging, and marketing of the
existing products, in order to recreate thoughts of the customers about the product.
Paradigm innovation
Paradigm innovation forms, different business operations and strategies, by using
mental thinking in a complete different way. It is also beneficial for organization and
customers. It is the masterpiece of alternations in the mental thinking process, that case
the business strategies and operations. It is not necessary that the change brought by
paradigm is always positive but it creates a base for development in business. It is
considered as one of the main prospect of innovation and it can bring changes in the
business process. Paradigm innovation has is entire principles on which a business
stands (Baregheh et al., 2016).
Initiation of product innovation will not only fulfil customers’ requirements but it also
adds an additional product in its product line along with creation of value in the market.
As a result, the business unit finds it easier to compete with its competitors.
Innovation funnel
Innovation funnel helps in acquiring optimum ideas and utilising the best feasible idea
for the business process and commercialization. It also gives a clear view regarding
investigating and determining ideas.
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Figure 1: Innovation Funnel
(Source: Vanhaverbeke, 2013)
Innovation funnel comprises of three steps. The first step is investigation; the wider side
of funnel represents it (side with bigger mouth). Business unit like Holland and Barrett
tries to accumulate as much as idea possible from the sources likes market place,
customers, whole sellers, and distributors. They will also try to inspect the concept and
strategies of its competitors (Yun, 2017). After completion of first stage, they will initiate
the development stage. During this stage, the implementation of ideas is done. They
also give wide preferences to the ideas of its employees. After acquiring ample ideas,
Holland and Barrett will implement ideas matching their objectives. The best-suited idea
will come forward from screening of ideas. Based on best suited idea, estimation of risk
factors and returns is done. Testing of services and products with customers will provide
confidence to the business unit to launch products. After the termination of second
stage, final stage arises. In this stage, Holland and Barrett will get reassurance about
launching the product in the market, for actual use.This is only done if the organization
finds the idea is capable of delivering service and quality to the customers.It is clear
from studying innovation funnel that generation, screening and testing of ideas enable a
company to take a correct initaitives
Explain developments in frugal innovation and provide examples of how it is
used in an organisational context
The process of reducing complexity in goods production along with price from the
available resources is known as frugal innovation. Nowadays, business unit tries to hold
the market by providing best and cheap quality product to its customers. In order to fulfil
this, the cost of production must be minimal and the process must be technically
advanced. Frugal innovation also focuses on minimal use of natural resources, by
eliminating complexity. Due to frugal innovation, less economically stable people having
very less income are able to buy the product. This is the objective of frugal innovation
(Weyrauch and Herstatt, 2017).
Holland and Barrett has not implemented frugal innovation within its policy. Frugal
innovation has not started by Holland and Barrett until now. In order to hold market
share against its competitors Holland and Barrett must take certain proper initiatives to
less the price of the product by 60-70%, without compromising the quality. Frugal
innovation will also help to develop design system and decision making ability of the
organization and thus enhance the quality of products.
Holland and Barrett have to initiate frugal innovation technique because in some
developed countries the customers are quite pricing conscious. Frugal innovation not
only delivers products at cheaper price but also gains competitive advantages from the
competitors (Tran and Ravaud, 2016).
Holland and Barrett can start ambulance facility service for patients during emergency.
It has been seen that people during casualty do not find ambulance on time. This will
help poor people who are from low economic background.
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LO3
Discuss the process required to commercialize innovation
P5 Explain the importance of the commercial funnel and the application of new
product development (NPD) processing for commercialisation of innovation.
Figure 1: Commercial Funnel
(Source: Created by Learner)
The above figure displays a Commercial Funnel that describes the way of a company’s
prospects to go through become prospective consumers. Holland and Barrett tries to
market its goods, and only little number of consumers transform it into clients and lead.
The initial step of this funnel assists the company to allure the visitors and expand the
perceptibility of products. Holland and Barrett grab the customers concern by content
marketing, advertisement and social networking means. When the consumers wanted
to explore about the goods, it is very important to create interests in their mind.
Charismatic visuals and pertinent contents can assist in conducting interests among
consumers. The adjacent step is to grow passion among customers to purchase
products through making trusts and association. Email campaign and social media can
assist the company to use fully this process. The last stage aims that it can make the
customers can keep in touch with this brand. When a new product or service is
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prepared to launch in the market it goes through several development steps (De Bonis
et al., 2018). The total process is inclusive of designs, manufacturing, testing and
building the products to understand its viability. The ideas are as follows:
Generation of Idea
Researching the market trends and opportunities helps in launching new product,
considering external and internal analysis. (Wooten et al., 2017). The company explore
the new ideas of innovation and steps for launching that product.
Screening of Idea
From the innovation ideas how much profit is obtaining from the market and how much
sale is going on, it totally depends on the idea formation they processed on the product.
Screening of idea eliminates the unnecessary solutions of different customer views
considering the size of the market business.
Testing concept
The company when represent a product, it observes the point of view of customers
regarding the product. They actually work on that concepts, implement on the product,
and re-launch it on the market.
Development of marketing strategy
These development strategies allow a company to build a plan encrusting all strands of
products. This plan is inclusive of all points regarding the idea of magnitude of the
market, its structure, market share, and goals of profit. With pricing and dispensation
strategy, this contours the budget of the market too (Menon et al., 2015). The first year
budget and the distribution strategy of the market is handled by this logic. Marketing mix
planning and extended sales are included in this section.
Business analysis
The approximate budget of the product is determined after collecting view and
feedbacks from the consumers. The company examine the viability of the products
before selling it. Profits and volume of sales are other characteristics for the
development of the goods that assessed in this stage (Jenkins et al., 2015).
Test Marketing
This stage implicates the specified area of the market where the products and services
are selling. Through this test, the company analyzes the viewpoints of customers
attaining the product. This way, the company assess the performance of its goods
(Malhotra et al., 2015).
Commercialisation
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