Innovation and Commercialisation Report: Beverage Company Analysis

This report analyzes innovation and commercialization strategies within the context of Essence Drinks, a UK-based beverage company. It begins by defining innovation and its importance relative to invention, followed by an examination of how organizational vision, leadership, culture, and teamwork influence innovation and commercialization. The report then delves into the 4Ps of innovation, the application of the innovation funnel, and frugal innovation, using Essence Drinks as a case study. It further explores the commercial funnel, the New Product Development (NPD) process, and the creation of an innovation business case. Finally, the report evaluates different tools used to develop, retain, and protect knowledge and intellectual property, providing a comprehensive overview of innovation management within the company and the beverage industry.

INNOVATION AND
COMMERCIALISATION

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
P1. Explanation of Innovation and determination of its importance in comparison with
invention.................................................................................................................................1
P2. Explanation of how organisational vision, leadership, culture and teamwork can shape
innovation and commercialisation..........................................................................................4
TASK 2............................................................................................................................................5
P3. 4Ps of innovation and use of innovation funnel...............................................................5
P4. Explanation of developments in frugal innovation and its use in Essence Drinks..........8
TASK 3............................................................................................................................................8
P5. Importance of Commercial Funnel and Application of New Product Development (NPD) 8
P6. Innovation Business Case...............................................................................................10
TASK 4..........................................................................................................................................11
P7. Evaluation of different tools are used to develop, retain and protect knowledge and
intellectual property..............................................................................................................11
CONCLUSION..............................................................................................................................12
REFERENCES..............................................................................................................................13

INTRODUCTION
Innovation refers to the procedure which is undertaken by organisations in order to introduce
a unique feature or uncover new techniques to perform activities (Ahn, Minshall and Mortara,
2015). Regardless of its size, each company needs to adopt innovation as a crucial method to
survive in the current business environment. Moreover, implementing innovation within the
company allows the entity in gaining an effective advantage in the market. The following report
is based on Essence Drinks, which is a beverage company in United Kingdom dealing in healthy
Mango Lassi. The organisation is planning to implement innovation within their firm and would
be coming up with element, that is Zinc to be added to the Lassi and develop a new range using
new packaging method which would completely be antimicrobial. The report covers a detailed
explanation of innovation and invention and explanation of various types of innovation. It also
covers a detailed discussion on the process which is required to commercialise innovation, along
with a range of different methods for effective protection ideas including their advantage and
disadvantages.
TASK 1
P1. Explanation of Innovation and determination of its importance in comparison with invention
Invention refers to a completely new and unique offering which is provided by an
organisation. In addition to this, this process enables a company in providing a distinct product
or services that will serve a certain type of customers and fulfil demands of a specific kind of
customers who need that product or services produced by the company.
Innovation is a transition of a concept into an actual feature or add-on in a product or a
service which allows an organisation to enhance usefulness of their offerings, whereas the
product itself would be quite useful in relation with fulfilment of another utility. Within this
process, it is required that organisation take the initiative, where individuals within the same
applies their imagination, along with analysing of the demand in the market which could be
fulfilled by the innovation. This process could be appropriately incorporated within any service
or a product which enhances its utility and makes it more prominent in eyes of customers. In
addition to this, consistent and useful innovations tend to help the company in effectively a
sustainable competitive advantage (Dincer, 2017).
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However, innovation is quite important for a company like Essence Drinks and its
importance is appropriately highlighted as below:
 Brand Image:
One prominent importance of innovation within an organisation like Essence Drinks is that
with enhancing usefulness in their offerings or processes, it would lead to a better brand image
within the market (Miller and et. al., 2016). It is an essential need of the business organisation
which will help the firm in appropriately serving the market in a better manner, thus, ensuring a
better brand image
 Profit Maximisation:
Another effective importance of innovation is that it leads to earning better profits. This is
because innovation in a certain offering attracts more customers as their demands are now
fulfilled.
However, there are certain significant aspects related to innovation which enhances its
importance in comparison to invention. This comparison is effectively discussed below:
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BASIS INNOVATION INVENTION
CONCEPT
This process means
implementation of unique
concepts for the company’s
existing offerings (Hemphill,
2014). It appropriately
enhances value of
organisation’s products as
well as services which assists
in enhancing its sales revenue
and contributes in the
efficiency of the company.
It means effective creation of a
completely new offering for an
organisation. It effectively
serves like a concept for
innovators through unique
products and services creation
that haven’t been developed
before,
SKILLS
In context with innovation, it
is important that each
employee of the company
possess several strategic,
technical as well as marketing
skills which allow them to
implement innovation
effectively.
Employees, in order to ensure
effective invention within the
firm must appropriately
possess several scientific skills
which require to brainstorm
ideas and amalgamate the same
with market needs and
technology to create an
offering.
OCCURRENCE
Occurrence of Innovation
depends upon need as well as
scope of improvement in the
existing offerings of the
organisation.
Occurrence of Invention
effectively depends upon
striking of a unique idea in
minds of scientist of the
company (Ismail, Nor and
Sidek, 2015).
CONCERN
The concern of innovation
primarily focuses on all the
offerings which the firm has
to offer.
In contrast with innovation,
invention is concerned only
about development of one
single commodity or service.
LIMITATIONS
Innovation is facilitated within
each department of the firm
which reduces its likelihood to
be limited to a particular
department
Inventions, usually are
associated with Research and
Development of an
organisation.

P2. Explanation of how organisational vision, leadership, culture and teamwork can shape
innovation and commercialisation
Commercialisation is an activity which is associated with introducing or communicating a
new offering into commerce. This means, that this procedure is adopted by companies in order to
present their newly developed products or process within the marketplace, which means
providing the same to customers (Kutvonen, Savitskaya and Salmi, 2014). As for innovation as
well as commercialisation, there are several elements within Essence Drinks which could
appropriately shape up both of these aspects. These elements are described below: Vision: Essence Drink’s vision is to provide the healthiest and high quality beverages to
its customers all over the country. This aspect could prominently shape up innovation and
commercialisation because there are several advancements in terms of health and quality
which would encourage the company to adopt these practices into keeping up with the
consistency of providing high quality beverage which provides immense health benefits
to customers. Moreover, in order to attain the vision, the firm must work towards
following and implementing the health and quality advancements, which prevails in the
market in terms of beverages, which would further help them in innovating their offerings
to satisfy the need. Leadership: As for leadership, it is quite evident that Akshay Kumar is an autocratic
leader (Sengoku, 2015). This means that he takes his own decision of making beverages
within the company and how best this could be sold within the market. This could restrict
the creativity and innovative spirit of subordinates and might hinder the innovations
which could take place within the company. Thus, in order to sustain and appropriately
support innovation and commercialisation, the company must adopt democratic
leadership which would help Akshay Kumar in collaborating appropriately with the
subordinates and bring out new and innovative ideas within the company through
combining the mindsets and indulging in meaningful brainstorming regarding appropriate
aspects.. Culture: Organisational culture means accumulation of certain beliefs, norms, attitudes
as well as values of employees of an organisation. In context with Essence Drinks, the
culture within the company promotes and supports innovation as well as
commercialisation. It is because the leaders of the company emphasise on providing
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platform to subordinates to showcase their innovative ideas for the company, which
facilitates commercialisation and innovation. This positively impacts the company as
well as its offerings to the individual and would effectively shape up these factors
effectively. Reason for the same is that with a culture open to receive new and unique
ideas and concepts, the firm could appropriately introduce new features and effective
innovations within their company.
 Teamwork: For any activity within an organisation, it is very important that the company
emphasises on formation of different teams which appropriately helps in shaping up
innovation and commercialisation. This could be done by forming teams which could
brainstorm ideas and transit the same into an innovative offering. Moreover, the firm
must indulge in forming departments related to innovations which collectively would
contribute towards new concepts and would shape innovation and commercialisation.
However, in addition to this, there are different sources of innovation which allows the
companies in developing an environment as well as culture of innovation. These sources are
discussed below: Industrial Structure Change: One of the most prominent sources of innovation is
structural change of an industry. This could be in terms of technology, infrastructure or
regulations in relation to innovation (Razak, Murray and Roberts, 2014). This source
could be prominently utilised by Essence Drinks to appropriately implement innovation
within their company as well. Demographics: Another source of innovation is demographics. There are several changes
which occur in the demographic aspect of business environment such as changes in
population, human capital, income level, etc. This requires the company to appropriately
develop more innovative offerings which could withstand the force of such crucial
changes (Plewa and et. al., 2012).
 Perception: This source directly deals with what customers require from the company. In
other words, this is effectively based upon the perception of customers related to
offerings by the company. As an example, people within the UK are quite health
conscious lately which creates a need for Essence Drinks to innovate their offering.
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TASK 2
P3. 4Ps of innovation and use of innovation funnel
For Essence Drinks, it is very essential to use the 4Ps of innovation, which is one of the most
effective frameworks led out to effectively understand innovation. There are basically four
elements of this model which is quite imperative for to be understood by the organisation in
order to effectively ensure innovation. These elements are discussed below: Person: This element could be referred to the entrepreneur of the organisation, which, in
the context of Essence Drinks, could be Akshay Kumar. He, as an entrepreneur and is
responsible to apply their skills as well as all of their creative abilities along with
motivation to develop an effective product, Process: This element means the procedures which have been used by the entrepreneur in
development of the product. However, rather than methodology, this process is more
inclined towards the thought process. This could also be referred to problem solving
aspects which involves development of a new solution (Pellikka and Malinen, 2014). Product: This factor within the 4Ps of innovation is the actual offering developed by the
entrepreneur which is an outcome of the creative process. In relation to Essence Drinks,
this product is the healthy Mango Lassi which is served by the company.
 Press: It appropriately represents the environment within which entrepreneur functions as
well as operates in for the creation of Product. For Mango Lassi, the press could refer to
all those conditions which were either conducive or prohibitive for any sort of innovation.
It also includes organisational culture of Essence Drinks, resources available with the
organisation as well as the best practices adopted by Akshay Kumar and his subordinates.
This model is very necessary for Essence Drinks to opt which would help the firm in creating
an organisational culture which could effectively promote creative ideologies and develop
processes which help the entrepreneur in producing effective offerings (Mazzarol and et. al.,
2014).
Innovation Funnel:
Innovation Funnel refers to a technique or a procedure which could be utilised by an
organisation to create an offering within the company. The prime agenda of innovation is to
assist the company in development of only those products and services which perfectly match the
needs as well as preferences of customers. Essence Drinks, in order to develop such products or
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services or improvise existing products, must involve three major steps of this funnel which
would help the company in developing, embedding as well as measuring innovation. These three
steps are described below:
Illustration 1: Innovation Funnel
(Source: Innovation Funnel, 2019) Assessment of Opportunity: The very first step of this funnel requires the company to
perform extensive market research which would allow the company to gather effective
knowledge of the marketplace (Mazzarol, 2013). This could be done by surveys or
questionnaires and could help in assessment of opportunities available to them in the
market. Ideation Process: The next step in this process calls for ideation of several offerings
which could help in capitalization of the opportunity. This could be done through
brainstorming and is dependent on the insight of customers. Conceptualisation: In this step, concepts are designs on the basis of these ideas which
could involve advertising copies, packaging mock-ups or distinct configurations of the
features of the product. Benchmarking: In this stage, the company must screen their concepts and ideas. The
agenda of the firm at this step must be to determine which idea would effectively provide
the firm with maximum benefits in terms of sales and revenue. There could be various
Performance Testing methods which could be applied to each innovation to determine
and forecast their long term suitability and profitability with the company. Based on the
tests, actual iteration of the concepts could be developed.
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 Go or No Go and Launching: After the idea is screened and chosen, this last step calls
for evaluation of the selected idea against the objectives of the firm. Furthermore, after
the idea is evaluated, it could be developed into an offering and launched into the market
P4. Explanation of developments in frugal innovation and its use in Essence Drinks
Frugal innovation is a procedure that is effectively utilised by a company to develop
products as well as services which are high on technology and could be made available at low
prices. Furthermore, several external forces of business environment of an organisation like
Political Factors, Social as well as Environmental Factors act like driving forces for this
innovation. The main purpose of frugal innovation is to create an offering through reduction in
its cost. Its outcome could be quite favourable for the company as their offerings would be now
available to customers who couldn’t afford it earlier, hence, increasing their customer base.
Frugal innovation is of quite an effective use to Essence Drinks as this could lead to
effective enhancement in their profitability as there would be quite a reduction in certain
superfluous costs. Furthermore, this innovation could also be adopted by the firm in case there
are limited resources available with the company to develop their offerings. One effective
example of frugal innovation that could be considered by the firm is Antimicrobial Packaging,
which would allow the healthy beverages of the firm to be better in terms of durability and
providing immense benefits.
TASK 3
P5. Importance of Commercial Funnel and Application of New Product Development (NPD)
Commercial funnel refers to the overall customer journey towards purchasing an offering
of an organisation. Having a commercial funnel could be quite beneficial for Essence Drinks
which would be helping the company in attracting more customers and persuading them in
acquiring their product. Furthermore, this could also help the company in effectively bringing
potential customers into the fold consistently and promote all the offerings overtime. There are
various steps of commercial funnel such as awareness, opinion, consideration, preference as well
as purchase, all of which could be effectively used by the company to appropriately attract and
influence their purchase decisions.
As for the New Product Development at Essence Drinks, there has been several health
related issues within the UK, which has increased awareness among customers for a new product
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which could protect them adequately from any sort of harm or damage. To ensure the same and
to effectively enhance the scope of improvement in health as well as increase in shell life of the
products, the company has come up with a new range of drinks which would be inclusive of
Zinc, to address the health issue of the people of the UK as well as provide a better shell life
through Antimicrobial Packaging. Apart from this, there are several steps associated with the
New Product Development which are discussed below: Idea Generation: The very first step of the New Product Development begins with
generation of ideas which requires Essence Drinks to come up with new ideas for their
product. Internal sources such as company’s R&D or External sources such as
competitors, suppliers, etc. could be chosen for idea generation. Through these sources,
the organisation stated a new range with added Zinc as well as Mix Fruit Lassi as new
ideas. Screening: The next stage calls for screening of the ideas which could refer to filtration
of various ideas to select the most prominent ones. Within this stage, organisation
screened both the ideas and chose new range of Lassi as a better option. Development of Concept: After screening, Essence Drinks must develop all its attractive
ideas into product concept. This concept is further tested amongst several small groups
of target customers to determine its appeal. Responses of these customers in relation to
the new drink came out to be quite positive. Marketing Strategy: This step requires Essence Drinks to effectively develop a
marketing strategy. This must focus on elements of Marketing Mix like Product, Price,
Place and Promotion which will be important for the Antimicrobial Packaging by the
company. For its new range, the firm has used diversification as a product strategy,
which would be provided at low price range at the company stores as well as would be
using social media as a promotional strategy. Business Analysis: After determination of the product concept as well as the marketing
strategies, the next step requires Essence Drinks to evaluate its new range of Lassi with
Antimicrobial Packaging’s business attractiveness. This needs the firm to review the
cost, sales as well as profit projections of its new product in relation with the pre set
organisational objectives (Robertson, 2014).
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 Development: This step is associated with the actual development of the new product
which, in context of Essence Drink, is a new range of Lassi with added Zinc elements
through Antimicrobial Packaging. This would be subjected to internal testing in which
the product would be tested against several pre set performance criteria.. Test Marketing: In this step, new range of Lassi along with its marketing programmes
would be tested in appropriate as well as realistic market settings, which would allow the
company to view its effectiveness and perform several modifications in relation to this
product.
 Commercialisation: The last step of this process is the actual launching of this new
product within the marketplace.
P6. Innovation Business Case
Innovation is an imperative part of an organisation and must effectively be included within
once organisational culture (Smith and et. al., 2014). In context with Essence Drinks, innovation
could help the company in increasing its competitive advantage in the market and would help in
surpassing the competitors present in the country. For its new innovation of a new and unique
Lassi range, with added Zinc elements for more health using Antimicrobial Packaging, it is very
necessary that the organisation develops a detailed business case, inclusive of all the necessary
aspects in relation to the overall implementation of the innovation.
STEPS DESCRIPTION
SUMMARY
Essence Drinks is one of the most recognised beverage company
located in United Kingdom, which deals in healthy Mango Lassi.
However, due to decrease in sales, the company requires innovative
range of drinks.
PROBLEM
The company is struggling with reduction in loyal customers and
appropriate market share, due to ineffective innovation in its
offerings.
OBJECTIVES
The current objective of the firm is to develop a new and innovative
range of drinks without completely depriving from its original
product, which is Lassi.
SOLUTION To attain the above objectives, the new range of drinks would be
packaged using Antimicrobial Packaging, which, along with
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