Innovation and Commercialisation: Apple and Virgin Group - Unit 8

This report provides an assessment of innovation and commercialisation concepts and theories within organizations, specifically focusing on Apple and the Virgin Group. It begins by defining innovation and its importance compared to invention, using examples like Apple's iPod. The report then explores how organizational vision, leadership, culture, and teamwork shape innovation and commercialization. It further examines the 4 Ps of innovation (Product, Process, Position, and Paradigm) and the innovation funnel, highlighting how these tools can be applied. The report also discusses the importance of these concepts to employees and how companies like Madgex Ltd have adopted similar strategies to achieve success. Overall, the report provides a comprehensive overview of how innovation and commercialization are crucial for organizational growth and success, supported by practical examples and theoretical frameworks.

Unit 8
INNOVATION AND
COMMERCIALISATION

INTRODUCTION
The purpose of the report is to assessment of innovation and commercialisation concepts and
theories in the organisation. Innovation can be defined as new ideas and methods. Innovation
involves information, imagination, and initiative in deriving different values from resources, and
includes all process by which new ideas can be generated to be converted into products. Here the
report addresses the organisation Apple and the Virgin group. Apple has released a small, sleek-
looking device called iPod. A digital looking player, it weighed just 6.5 ounces. Virgin group is a
group of companies based in UK. Its business areas include travel, entertainment, finance, and
live style.
Task 1
P1 Explain innovation and determine its importance to organisations in comparison with invention
` Innovation is the development of customers’ value through solutions that meet new,
undefined, or market needs in unique ways. Invention is the process of creating a new
product,process,device .The inventors try to develop a product that is completely unique and has
not been discovered it. Apple and Virgin group both have introduced some unique and new
product to give better services to the customers and make profit by providing these facilities to
them.
The innovation can be termed as a process of developing new strategies and plans to add a value
to organization. It may be creation of a new service,process and improvement of the existing
ones. It can be considered as re-movement of old services and updating it with new trends.
Example-The iPod released by Apple is an innovation.
The invention and innovation both are important for the organization as invention allows to
develop a product that is not known from before and can help the organization to sustain in the
competitive market. On the other hand,Innovation can be useful to update the existing product
with some new ideas and knowledge and be beneficial to the organization to give better services
to the customers.

It may include new products, services, processes, technologies, and ideas. Importance of
innovation to the employees of Apple and Virgin organisation- Motivation-Innovation motivates employees as they are very interested in the further
development of company they try do their best which help in motivating them. Even the
new techniques motivate them to achieve goals (Bogers and West, 2012). Communication- Formulation of new ideas and techniques promotes internal
communication which gives a chance to employees to put their view points and get
together. This helps them to get innovative ideas. Efficiency- Bringing up of new technology helps to increase the efficiency of the
employees. Advanced technology increases the speed and working power of employees
(Chan, 2010).
 Empowerment- Innovation increases the empowerment of employees. If employees are
taught about product, service, process, and market innovation with a common task they
will perform their task with responsibility.
Comparison between innovation and invention
Invention vs Innovation
Invention Innovation
1)The creation of a product,process that has
not been developed yet.
It is process of updating or enhancing the
products in order to fulfil the desire of the
customers.
2)Invention only require scientific skills. This requires marketing,technical and strategic
skills .
3)It is the concerned with one product or
process.
It can deal with various products and processes.
4)iPhone developed by Steve job is invention iPhone 5,iPhone 6,iPhone 7 are innovations
that are made.
In Virgin group ,the invention has benefited small companies by providing more job
opportunities to people which would lead to increase in economic growth and will help small

business to become big in the competitive market. The innovation can be beneficial in small
businesses to meet the changing needs of people and to earn profit by fulfilling their wants.
Invention is an idea for a product or process that has never been made before whereas innovation
implies the idea for product or process for the first time. Apple invented small, sleek-looking
iPod a digital music player. It has innovated this player which can hold a lot of music. It has
added some of the features which has made it easy for customer. Apple came up with a
innovation creating unified music discovery which revolutionized the music industry. Innovation
has provided competitive position to the company in the marketplace (Chiaroni, Chiesa and
Frattini, 2010).
P2 Explain how organisational vision, leadership, culture and teamwork can shape innovation
and commercialisation
Vision of organization-It is the clear image of an organization at a particular period in
the upcoming years. It provides a way of defining the organization wants to be like,to be
developing in the upcoming time. The current Vision of Apple is to develop a Macs along with
OSX software. Apple wants to be at top position in digital music department with the iPod online
stores. The vision of Virgin group is to provide a long term profit in areas of travel and
leisure,Telecoms and media and other sectors.
Leadership-This factor keep an eye on area that is perfect for both individuals and best for
group as a whole. In Apple, the leadership practices have been greatly effective under the
guidance of Tim Cook and had lead to new innovation of Apple Watch .This is an important
discovery for an Apple.
Culture-These are based on the values and beliefs that determines the behaviour of people in
the organization. These values have a great impact on the people working in the organization.
For Virgin Group both its employees and customers are important. The Virgin group provides an
atmosphere where all the skilled and talented people are encouraged to their best and develop
new plans and strategies to upgrade the existing systems which would lead to new innovation.
Teamwork-This would be an essential factor for organization where the employees are given a
change to interact with other employees to enhance their employment relations. Teamwork at
both Apple and Virgin Group will encourage the employees to come forward and interact with
other staff,this would help to develop a friendly environment and sharing of

ideas,belief,knowledge. Working together in team can be an essential factor for innovations in
these organization.
Company to be successful it needs to have clear vision of the goals, mission, and values.
These elements help and guides the team and the vision of the company to commercialisation.
Mission gives a target to the organisation to be achieved. It helps organisation to know about
what and where innovations are needed. Madgex Ltd is trying to follow the leadership policies
where the employees are guided and motivated to work with new innovations. Motivation and
innovation helps to increase the working power of the employees through which organisational
goals can be achieved. Employees of Apple and Virgin work together in a team and achieved
their best as well as higher level performance. Madgex too has followed the same criteria where
employees are able to communicate with each other and can present new and innovative ideas.
Management is playing the role of effective team leader to make employees capable to accept
any innovation brought in the organisation (Giannopoulou, Yström and Ollila, 2011).
The success of an organisation not only depends upon innovation and commercialisation
or the best business strategy chosen. They don't have any meaning without the right person or
employee to execute it. Employees of Madgex Ltd fulfils their right role for its success. Its
employees have the role of technical expert and try to undertake their various tasks. They
perform their job according to mission, goals and objectives of the organisation. Employees
manage their responsibilities towards work assigned to them. Madgex employees helps to grow
the organisation in terms of profit. They put their full efforts to increase the profit ratio. Not
every employee can lead, some employees are knowledge seeker who wants to continually learn
about their job which benefits to both employee as well as organisation. Madgex employees
support management's decisions and create a challenging environment for other organisations.
They help to make sure that organisation has best strategies and ideas. Madgex Ltd has tried to
achieve the goals, vision and mission by implementing business strategies. Its team leading
quality has helped it to make efficient use of employees and follow the culture. Its motivating
strategy has helped to improve their work performance (Grönlund, Sjödin and Frishammar,
2010). It has brought innovation to its technologies which increased work performance,
innovation to products increased the consumers. In this way Madgex, too has followed the same
strategies and innovation followed by Apple and Virgin and achieved success.

TASK 2
P3: 4 P's of innovation and use of innovation funnel
4 P's of innovation
Transforming an idea into a good or service is very crucial job. An innovation includes
variety of information, initiatives and imagination for the purpose of deriving bigger or different
values from available resources. Madgex need to understand all the aspect of innovation prior
implementing it. The 4 P's of innovation can be considering one of the powerful tool for deriving
innovation into the organization. Following are the 4 P's of innovation:
Product innovation- Improvise the products and services is the first step in order to
implementing innovation into the company. Madgex can include significant improvements in
components, technical areas, material and software. I-pod is referring as one of the most
innovative product by Apple. It is considered as world's smallest music player. Virgin Atlantic
also invest a huge amount in the product development process (Guan and Chen, 2010).
Process innovation- Innovation also include a series of processes through which products
are developed and delivered. Madgex can use process innovation for implementing a new and
improved production and distribution method. Apple also use this method at the time of
launching the I-pod. They improvise the product several times to make it more user friendly.
Position innovation- The position innovation refers to re-positioning the perception of
existing products and services. Apple shuffles the position of I-pod several times for providing
excellent quality music and make it a devise which can easily carry and control. Virgin brand
also positioned them different sets of businesses (Hoerl and Gardner, 2010).
Paradigm innovation- Virgin Atlantic make a better use of paradigm innovation by
providing low cost airlines. It is the stage of innovation where the dominant paradigms of
company are defining and re-define.
Innovation funnel
Innovation funnel considers the steps which are used in developing a product or process.
Madgex can use the funnel for shaping the innovative ideas in the mind of employees. They need
to innovate their products and process in meeting the market need in bot forms manufacturable
as well as economic. The development of innovation funnel mainly consists three major steps:

Source:(Innovative funnel,2017)
Investigation- At this stage, the employee of Madgex required to collect knowledge and
information base. If the employee of the organization has ample of ideas then Madgex can
innovate their products. In this process, company need to have a deep insight about their
customers, markets and needs so that implementing the innovation become easy (Lindič, et al.,
2011).
Development- The second step of innovation funnel will be useful for the employee of
Madgex in terms of screening the ideas. At this stage, the employees of company will carry out
the assessment to selecting the ideas on the basis of risk and returns.
Shipping the products- In the last stage of innovation funnel Madgex will ensure that the
selected idea have the capability to deliver the objectives. Employees of the company will
release the new product or service into the market (Snow and et.al., 2011).
The innovation funnel is very simple concept which can be adopted by Madgex.
Definitely, it will help the employees to shaping the innovative ideas in appropriate manner. This
innovation model is supporting the safe ideas.
Illustration 1: Innovative funnel

The funnel can be used in both the above example Apple and Virgin Group to make a new
product plan and strategies to enhance their business in the market place and to make more
growth in the upcoming time.
The funnel that is used involve various steps that need to be followed to develop new product
plan. They are as follows-:
Idea Generation-To fulfil the objective and goal of organization new ideas and plan are found.
Both Virgin Group and Apple searches for new ideas to meet the goal of their organization.
Concept Investigation-It is carried out to find which ideas are relevant and correct. More
detailed study is need to be carried out.
Feasibility-The ideas are then examined practically to see profits,sales,Returns on investment
etc. These are also conducted by Apple and Virgin Group to see what there profit will be,sales
and returns etc.
Capability-The ideas is then turned into a product to see the strength and weaknesses of that
product. Conducts experiments to verify the previous business judgements.
Launch-The product is launched in the market.
Roll-out-It is then out in the market where customers can use the product.
P4: Developing frugal innovation
Madgex is the leading supplier in the area of outsourcing the job boards and resume
software in UK. The leaders of organizations willing to use innovation in their area of business.
In addition to this, frugal innovation can be most economical technique. The frugal innovation
considered as the process of minimizing the complexity and cost of goods and production. It is
useful tool for Madgex as they are not very financially sound organization and cannot invest a
huge amount on innovation. Before developing the frugal innovation for Madgex, it is important
to understand how Apple and Virgin did it (Thore, 2012).
Apple is one of the biggest globally known company which is always in search for new
approaches to innovation. Company always innovate new products is their business process such
as- Macintosh computers, I-pod, I-pad and I-phone. For placing the frugal innovation in the
process Apple use various distribution channels which is also considered as process innovation.
For example, I-pod launch with two different distribution channels, direct and indirect. The
direct channels are Apple online store, which makes the prices much lower for the company and
the profit margin increases (Van-Hemert, Nijkamp and Masurel, 2013).

Virgin is also a multinational company which is holding multiple ventures under one
umbrella. When it comes to innovation Virgin is also considers as one of the top organization in
world. It starts with a mail order record company and invest in increasing the business model
which surrounded by providing excellent customer experience. Virgin adopt frugal innovation
technique in the early stage of business. For example, the innovative ideas of company are
mainly focus on winning the customer, value for money products, deliver great quality of
products and experience etc.
Madgex can also develop the Frugal innovation techniques within their business. As a
provider of digital recruitment solutions to the media they have wide scope for innovation. The
recruitment industry is evolving and growing with a rapid speed. Madgex can shift from resumes
to online profile. The social professional networks transform the process of finding job. Even
leading recruiters also use social platform in search of skilful candidates. The process does not
require huge investment so Madgex can make use of social media platform and indulge with
innovation techniques. Other than this, enterprise can also use the video technology for the
recruitment purposes. The video interview process prefers by the recruiters as well as candidates
because it save time, energy and money (West and Bogers, 2014).
The frugal innovation helps in finding out the new business models,designing the products again
to provide users with more exclusive markets. It gives functional solutions through limited
resources to people who are facing intense affordability constraints. The frugal innovation is
rising in markets by starting from down level and making it through all levels to benefit all users.
The development of frugal innovation can be useful in many ways-:
Immerse for improved consumer insights-The important of wants and desires of customers
can't be neglected and avoided. Both Apple and Virgin group develop the products according to
the proper understanding and knowledge of customer need. A great care is taken on the insight
knowledge of what the users are expecting.
Market driven -The market driven products are developed to be competitive in the market. The
Virgin group and Apple also develop market driven products and earns good profit from them.
Today the frugal innovation have lead to various innovative ideas and plans as company's want
to do more with less resources.
The six principle of frugal innovation are as follows-:
1)Recognizing opportunity in hardship

Reframe the issue. Finding out the problem or seems like difficult and turn it into opportunity.
2)Doing more with less
Thinking about what is there can provide a way to produce m ore better solutions.
3)Acting more flexible
Continuous improvement must be there it should not be rigid.
4)Keep it easy and simple
Complex things can produce problems .Few choices are better than more.
5)Including the margin
One should know their customers and involve them in problem solving process.
TASK 3
P5: Commercial funnel and application of new product development for commercialisation
Importance of commercial funnel
Commercial funnel also named as sales funnel is a process of sorting, narrowing,
following up and analysing the sales leads. It will be useful for Madgex in terms of structuring
the information about the product and service they are providing. Company can communicate all
the relevant information about their business operations which will generate lead for them.
Furthermore, it is also helpful for organization to ensuring that they are using regimented, well
organized and methodical approach for the purpose of building relationship with customer and
closing the deals (Wood, 2011). The commercial funnel is important for companies in various
ways, such as- Ranking the sales lead- Commercial funnel will be useful in terms of developing
organized process for evaluating, sorting, prioritizing and raking the sales lead. The
process is creating an understanding about which people are most likely to buy or use the
service.
 Focus toward the right sales lead- Developing a commercial funnel also gives Madgex
greater focus. It will allows them to giving time and resources to working on the right
sales leads. By direct interaction with the candidates and recruiters company will get
chance to learn about their prospective customers (Bogers and West, 2012).

(Source:Commercial funnel,2017)
New product development
The new product development process is one of the most crucial process for a business.
This process consist with seven different stages, such as-
 Idea generation
 Idea screening
 Concept development and testing
 Marketing strategy development
 Product development
 Test marketing
 Commercialization
The final stage of new product development process is commercialisation. Madgex can
use various techniques for attracting their target customer towards the new innovative product or
services. Company requires to think about the cost for manufacturing, promotion and
advertising. As Madgex is planning to launch their recruitment services on social media
platform. Here, they are heading towards the technology commercialization. It is referring to
taking an idea from the market and create financial value from it. It involves licensing an
invention, establish a new product or service, or developing a new business. Madgex can create a
I
llustration 2: Commercial Funnel

social media platform and start online recruitment services and also through technology
commercialisation they can market their software in front of large range of customer (Chiaroni,
Chiesa and Frattini, 2010).
P6: Innovation business case for Madgex
In order to increasing the level of profitability and sales Madgex is planning to launch
their online job board business on social media platform. Madgex can follow the techniques
which Apple and Virgin use for making themselves market leader. Apple is considered as one of
the most innovative organization as they produced most revolutionized computers. They
completely changed the way of listening music and reinvention of smartphones. Virgin group
also adopt innovation by expanding their business in diverse areas.
The idea of Madgex to go completely online will attract the large number of customer
because the target customer for the firm are youth which spend most of the time on social media
platform. Here, company require to develop a well-versed online portal which has to be user
friendly. In this manner, Company requires funding because finance plays very vital role in
business expansion (Giannopoulou, Yström and Ollila, 2011). Funding can be a best option for
Madgex in order to developing their products and services. In this context enterprise can use
sources of finance which are distributed in two categories:
External sources for finance: External sources for financing innovation include-
Debt financing- It can be useful for Madgex to secure the public and private credit for
developing the business. Loan from banks can be tool for debt financing.
Stock market financing- Companies such as Apple and Virgin using this source of
financing at a higher level. Madgex can raise their capital by issuing shares in the stock market.
Venture capital- It is also an option available to raising fund for Madgex innovative idea.
Venture capital can be defined as a pool of capital. Professional venture capitalist always ready
for investing in an innovative idea (Guan and Chen, 2010).
Internal sources for finance: Internal sources for financing innovation include-
Retained earnings- Madgex as a small and medium enterprise can use retained earnings
for investing in their innovation idea.

Personal savings- It is a backbone for small and medium enterprises. If Madgex is not
having the assets top finance in their new innovative project they still use their use their personal
finances (Hoerl and Gardner, 2010).
Budget for innovation
Expenses Cost (£)
Business analysis and innovative idea 1220
Product development 1830
Test marketing 600
Advertisement and Promotion 1300
Launching and distribution 1800
In order to measuring the effectiveness of their new innovative idea, Madgex limited can
use the following techniques: Test marketing- Using this tool Madgex can determine the effectiveness and success of
the newly launch idea. It includes testing the idea in small market before launching it.
Company can use beta version of their new software before launching the original one
 Feedback- It is very important and effective technique to evaluate the success of the idea.
Customer of the Madgex will directly provide the information about effectiveness of
software. Company can consider the suggestion given by customer and can improvise
accordingly (Van-Hemert, Nijkamp and Masurel, 2013).
 Market testing-It is an important factor in business and marketing filed. Madgex use this
to check the practicality of a product or service in the market place. The criteria that is
used to check the acceptability of a test market are include-:
1.The population of people in the target market.
2.Advertisement can be done to test the audience.
 Route-to-Market- This is a powerful tool that is used by Madgex to check the profitable
growth. Many companies use this tool to take their products and services to market in
most productive way. It is a fast and approved technology and can have benefited
companies in supply field,manufacturing and finance.

TASK 4
P7: Different tools for Madgex for retain and protect knowledge and intellectual property
Protecting and securing the company's knowledge and intellectual property is really
important matter of concern. Competitors can steal or copy the personal knowledge gain by
Madgex. So here Madgex need to use various tools which are available to protecting, retaining
the knowledge and intellectual property. Following are the tools which can be useful for
safeguarding the knowledge and intellectual property-
Patents- It is an exclusive right which is given by the country to an inventor. It is useful
for Madgex in order to prevent other to making, using and selling their invention. Apple has
patent for their each and every product. Enterprise willing to innovate their recruitment service
with the use of technology, it is very easy to copy and stole the technological innovation. Patent
is most effective tool to eliminate such consequences (West and Bogers, 2014).
Trademark- It is use for the protection of signs which company use to distinguish
themselves from other businesses. A trademark for Madgex will represent company logo or
signature. It is also playing an important role when firms willing to innovate as it gives
recognition to the organization which initiate.
Design Rights-If any design have been made,it is worth securing it with design right. A
registered design is an effective tool to prevent others from repeating or exploiting the new
design
Copyrights- It is also another form of protecting the intellectual property which provided by the
legislature. The protection category of copyright includes painting, literary work, photographs
and software. Madgex can use copyright for protecting the software which they developed
(Wood, 2011).
The intellectual property (IP)is a law that gives opportunity to people to gain
identification,business welfare from the work they create or do. The goal of IP system is to
develop an environment that will enhance creativity and innovations.
Exploitation of Intellectual property rights have helped the organization promote fair competition
by solving rivalries of patents in corporations. These rights have played a various role in
preventing various privacy issues .They are as follows-:

The major motive of business firms is to provide security to their business secrets in the best
possible way. Security of IP would give a roadmap to the firm to carry on the work in their
unique business innovation.
They help the firm and other entities to secure their particular brands,marks ,copyrights and other
rights around the world.
The branding help in protecting the innovation by establishing six types of IP rights
Trade marks-It will protect trade name and logos.
Design right-It will secure the appearance of product.
Patents-securing the inventions that are made.
Trade secrets-protection of private information.
Open innovation and Open source is a parameter where the firm can make use of external
strategies and ideas and internal knowledge or both to make their product more advance in
technology. The open innovation upon IP will be useful in Research and development
process,partnership between various organization and much more. Patents can be beneficial for
licensing agreements among various parties as they require explanation of the invention. These
IP rights can be termed as important parameter of innovative capability.
CONCLUSION
From the above study, it can be concluded that, companies are very much focused on
growth and innovation. The innovation and commercialization is one of the main priority for
business in order to get effective profitability and brand image. To increase the level of revenue
and growth enterprises are restructuring and redesigning the existing product and services. The
4P's of innovation and innovation funnel playing a significant role in understanding the process
which an organization can use while innovating. New product development process provides a
blueprint to firm, it contains all the areas started from manufacturing till distribution of new
product. Furthermore, Internal and external source of finance involves the method for investment
and funding. In the end, it is very vital for companies to protecting knowledge and intellectual
properties from competitors. In addition to this, patent, trademark, and copyright are effective
tools for safeguarding the innovation.

Online
Innovative funnel. 2017. [Online] Available through: <http://www.onedesk.com/innovation-
funnels-and-your-customers/>. [Accessed on 31 July 2017]
Commercial funnel. 2017. [Online] Available through:
<http://www.cloverleafinnovation.com/blog/winning-the-new-popularity-contest/>. [Accessed
on 31 July 2017]