Innovation and Commercialization: Organizational Impact Report

This report provides a comprehensive analysis of innovation and commercialization within business organizations. It begins by defining innovation, differentiating it from invention, and emphasizing its importance for organizational growth and competitiveness. The report examines the roles of organizational vision, leadership, culture, and teamwork in fostering innovation. It then delves into different types of innovation, including the 4Ps (product, process, position, and paradigm) and the innovation funnel, as well as frugal innovation strategies. The report further explores the commercialization process, including the significance of the commercial funnel and the New Product Development (NPD) process, along with the formulation of business cases and funding methods. Finally, it discusses methods for protecting business ideas and intellectual property. The report aims to provide a detailed understanding of innovation and commercialization, offering valuable insights for business development.

INNOVATION AND
COMMERCIALIZATION
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Introduction....................................................................................................................................3
LO-1: The background for innovation and the distinction among invention and innovation
.........................................................................................................................................................3
Task-1: Explaining the term innovation and its importance to organizations with comparison
to invention..................................................................................................................................3
Task-2: Role of organizational vision, leadership, organizational culture and teamwork in
shaping the innovation and commercialization...........................................................................4
LO-2: Types of innovation............................................................................................................5
Task-1: Innovation 4Ps and the importance of the innovation funnel to inspect and outline
innovative ideas...........................................................................................................................5
Task-2: Different growths in frugal innovation and the way it can be used in a organization
.....................................................................................................................................................6
LO-3: The process used to commercialize innovation................................................................7
Task-1: Significance of the commercial funnel and the use of New Product Development
(NPD) process..............................................................................................................................7
Task-2: Formulation of Business case for organization and the ways of funding.......................8
LO-4: Methods of protecting business ideas with their advantages and disadvantages.........9
Task-1: Examining the different methods that organisations can use to build up, retain
and guard knowledge and logical
property......................................................................................................9
Conclusion....................................................................................................................................10
References.....................................................................................................................................12
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INTRODUCTION
Current need of the business organization is to be innovative. This is essential for the
growth of the business organization in today’s world. Innovation organization is those who work
on principle of change. They have smart thoughts in their mind and use such thoughts to produce
innovative products. The do intense research on the ideas and convert them into creative
products. This report does a detail analysis on the innovation and commercialization. It brings
forwards the factors that are responsible for innovation, the misconceptions of people, strategies
that help in innovation in business organization and the process of innovation. It is a solution that
meets the current need of the business organization. The important element of innovation is
novelty. Clayton Christensen said that the organization can grow only if it believes in disruptive
innovation. Today the organization has to be competitive; therefore they have to be always
different from other. This difference can be of importance if the organization is innovative.
LO-1: The background for innovation and the distinction among invention and innovation
Task-1: Explaining the term innovation and its importance to organizations with
comparison to invention
The better use of the available resources is also a innovative idea. Some believe that
making something new, different from existing product and service which increases the demand
of the product is innovation (Business.gov.au, 2017). It does not mean that you have to always
invest something new. Innovation can be brought about by using the current existing product. It
just means to use the product in the better way so that the cost of the product can be decreased
and the demands of the product can be increased. It means assessing the current need of the
market and making changes in the organization so that it meets the current demand. The
organization will be always in benefit that is ready to change according to the current demand of
the market. Invention is one time process but innovation continues throughout the process
(Spulber, 2014). Invention is the first step but innovation helps the organization in long term.
Innovation helps the organization to be having a competitive difference. The organization
which is innovative will stay longer term in the market. If the organization is innovative it will be
able to assess the future demands of the customer but the organization which is not innovative
will concentrate only on the present demand (Business, 2017). . Nothing in this world is
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permanent innovation is the key to survive in the market. Invention is a new idea but innovation
is implementation of the new idea. Invention is a single product or service but innovation can be
done on two or more. There is specific department for invention but innovation is not limited to
the department. The organization which is risk taking in nature can be innovative because there
are chances that the innovative idea may be a failure.
Task-2: Role of organizational vision, leadership, organizational culture and teamwork in
shaping the innovation and commercialization.
The organization mission, vision and leadership greatly affect the innovation in the
organization. The vision of the organizations tells what the organization wants to achieve in the
future. Therefore the innovation has to be in line with the vision and mission of the organization
(Jonathanhalls.net, 2017). One set up vision so that it will be always best in the business world;
this can be achieved only when the organization is innovative. The innovation in the organization
is affected by the values and the organization culture. If the organization supports innovation
then the employee of the organization will always take steps so that they can make their work
different and the best (Emeraldinsight.com, 2017). Similarly the values of the leader affect the
thoughts of the employee. If the leader motivates the employee to be innovative the employee
will try to be innovative. An authoritative style of leadership will never favour innovation but if
the leader is participative in nature he will favour innovation (Driving Creativity and
Commercialization, 2014). Even the directive style of leadership will also motivate innovation. If
the organization has good coordination and communication in between the departments then it
will help in innovation as it will be brainstorming process. If information is shared in the
department then different people with different capabilities will try to bring the solution. More
people mean more solution to the problem and better analyzing of the situation.
People from different culture work in an organization. This is beneficial for the
innovation of the organization as there are different viewpoints form the employees. Diversity is
good for the organization if the culture of the organization is open. Employee can express their
viewpoints. Effective teamwork helps in smooth functioning in the organization.
Leader helps in setting up the baseline for the organization. They help in creating a
culture in the organization which favours innovation within the organization. They are the
experts in the area so they help in guiding the other individuals to inculcate innovation in their
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work. They help in creating teamwork within the organization. They close the innovation gap
within the organization. They help in setting the vision and the mission of the organization that
favours innovation.
LO-2: Types of innovation
Task-1: Innovation 4Ps and the importance of the innovation funnel to inspect and outline
innovative ideas.
Innovation keeps you changing, for the best interest of the organization. Some innovative
ideas may be a disaster for some but some may convert it into profit. The organization decision
making is greatly affected by innovation (Veza.biz, 2017). There are four components of
innovations which are also called the 4p of innovation. The 4p are described as below:
1. Product innovation: The each and every component of the product affects the quality of
the product. The demand of the people is shifting towards healthy products. Therefore
London Essence Company is going to launch new low calories soda. This will be able to
meet the demand of the customers. People are now more health conscious they spent lots
of time reducing their calories intake. This new product will be a innovative step towards
it.
2. Process Innovation: It deals with manufacturing of the product and the services. It deals
will optimum utilization of the recourses during the process. The process can be
innovative if it leads to less usage of recourses, less cost, less time usage and less
manpower requirement (Ziarab, hussain and Sher, 2017). This can be brought about by
the change in the technology. The organization will gain competitive advantage. The
demand for the existing products of the London Essence Company is decreasing so it
should thing of process innovation in its organization.
3. Position Innovation: It means that market where the product is being target should be
changed. For example it was earlier thought online shopping will only be done by youth.
But the current statistics shows that the scenario has changed and elder people prefer to
do online shopping. The London Essence Company can target its new customers based
on the demographics for example age, gender etc.
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4. Paradigm Innovation: It is a type of holistic innovation. In this the complete sector is
changed. For example changing the complete technology of the organization is an
example of paradigm innovation. Shift from manual data entry to digital recording of the
data is paradigm innovation. This involves lots of capital intake. Since London Essence is
currently a new organization they cannot think of paradigm innovation.
Before implementation of the innovative idea, proper research should be done. The idea
should be thoroughly checked. This is known as funnelling. The idea which will best suit the
current demand of the customer should be selected. Using an innovation funnel will help in the
selection of the best innovative idea. It consists of three stages. The first stage is collection of
innovative ideas and the information. In this the quantity of ideas are given importance in
comparison to the quality of idea. The second stage consists of dumping away the wasteful ideas.
Based on the resources, risk and return the ideas are selected. The last stage is the final stage. In
this those ideas are selected which best suit the organizations goals and the objectives.
Task-2: Different growths in frugal innovation and the way it can be used in a organization
The way of innovation has changed. The effective way to be innovative is to increase the
market share. This a example of Frugal innovation. In frugal innovation the product is target to
the customers which think that they cannot purchase the product. This is done by decreasing the
price of the product. By decreasing the price of product more customers can be targeted. It
basically concentrates on effective utilization of the resources. If the resources will not be wasted
can be targeted and the demand of the product will increase (INSEAD Knowledge, 2017). This is
the best way of doing the innovation. It helps in increasing the quality of the product and
increasing the demand of the product. This is a customer centric approach. The customer has to
pay less money and their disposable income increases. For example the Samsung phone that we
use in India is less complex in comparison to the Samsung phone in United Kingdom. This helps
to reduce prices in India which increases the sales in India as the purchasing power of India is
less than that of UK. This is also the example of discrimination of product according to the
market of the product.
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Frugal analysis involves lots of research work. Market analysis has to be done to find out
which type of customer can be targeted. It has to be checked weather such kind of step will affect
the brand name or not. Proper analysis has to be done on process of manufacturing. London
Essence Company can do frugal innovation by increasing its target audience. They are now
targeting youth who are health conscious. They can increase their age group target.
LO-3: The process used to commercialize innovation
Task-1: Significance of the commercial funnel and the use of New Product Development
(NPD) process.
The process of new product development is seen as an end to end process which has
different stages through which the idea has to go through before reaching the customer. These
stages are often represented with the help of a funnel. The process is called commercial funnel.
One of the major concern resolved for an organization are that it helps to sort and eliminate
products in its initial stages than at a later stage when it is difficult and costly to go back another
is that each stage helps to further refine the product for the end user. Thus, increasing
probabilities for the products success in the market. It is a process with gates where each gate
allows the management to take decision for the further stages and more funds can be allocated
accordingly. In the commercial funnel all the opportunities and ideas first goes through the step
of product concept development. In this the strangers get to know about the product. Then they
are converted to visitors. This is conversion phase. The next step is conversion of them into lead.
And the last step is conversion into customers by delighting them.
For any business or a product to sustain in the market and go through their full life cycle
it is very important to setup the new product into the market successfully. New products for a
company in today’s time are the lifeline to move ahead and sustain in the marketplace. Once the
new products are placed well they will be source of profits for them. Still there are not many
companies who go through the process of New Product Development and thus are not
successful. There has been research in the past to see how any companies are using the new
product development tool to drive their business. However it has been seen that most of the
products are motivated by the needs of market and customers and thus this is the only trend
which has been there since ages that one should listen to their customers and then develop a
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product .The process of finding new products and ideas is continuous however only a few
products are able to stick in this competitive market. Though new product development process
is able to arrest most of the issues in the stages of product development however it will also not
solve every problem in the development stage. New product development helps to give a clear
roadmap of stages which the company has to go through before placing the product in the
market. New product are seen as a way to be ahead of your competition thus any wrong move
here can be fatal for the organization. Despite knowing the importance of NPD and its positive
impact on the growth of the company there is still a very high percentage of the product which
fail when are placed in the market. This has also been seen that the rate of failure of products is
high as the new product development costs and time is also high thus companies tries to take an
easy route of placing the product without following the proper funnel. New product development
success is situational as well thus the companies must analyze their situation as well while
undergoing the process and also understand other factors which can have a positive impact on
the success of the product in market and allowing it to go its full market cycle.
The commercial funnel and the NPD process help to keep the focus on the inquiries. It helps to
check the revenue to reduce the cost of the product. The business can make use of new
opportunities. It helps to fix the target and the goals of the organization.
Task-2: Formulation of Business case for organization and the ways of funding.
London Essence Company is going to produce a low calorie soda drink. The demands of the
customers are changing. The customers are becoming health conscious. To bring this innovation
the company will also require funds. The funding can be done by following methods:
1. Personal Saving: Using the personal money of the company. It is the easiest method. But
the company has to bear all the risk associated with the project.
2. Crowd funding: It is a method by which the company can arrange funds through internet.
A link is made on the website and the interested parties can contribute their money on it.
A proper business proposal is made on the internet for such funding. So in the beginning
of the start up phase to generate money by crowd funding is difficult.
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3. Angel Investors: They are the investors who are ready to invest in the company for the
equity shares. They study the fundamentals of the company and make the investment.
There the proposal should be strong enough to attract the inventors. But it has a
disadvantage. The ownership of the company is lost by such investors.
4. Venture Capital funding: They are the investors who put their large sum of money with
the exchange of equity shares of the company. They invest only if they see high return.
They do not take money out of the company but continue invested. If venture capitalist
get attracted other investors are also attracted to make investment. They interfere in the
working of the organization because they have invested large sum of money.
5. Banking Financing: The organization shares proposal of their business to bank for getting
loan and this is the most frequently used medium for financing. Banks offer them money
and charge interest rate which can be paid when the business start earning profits. By this
source of financing equity shares are not sacrificial. You do not loss the control of the
company. But the documentation in bank can take time. The interest rate may vary from
time to time. It is an obligation that you have to pay the interest even if you have not
started making profit.
A business case should clearly mention the objectives under study. It should highlight the
business need in current situation. Details should be given about the background of investment of
the company and how the objectives will be achieved. It should be mention the probability of the
success of the proposal. Lastly, it should provide the board of director the options available for
the solution to the problem. The London essence company has a brand name. The company is
going to launch its new products for which funding will be required. Firstly, they can make use
of venture capitalist. Since the company is well known brand venture capitalist will be easily
available and make large investment for a longer period of time. But the ownership of the
company will be distributed. Secondly, they can also take the help of bank loan. This will be the
best method. The ownership of the company will not be distributed. Lastly, they can make use of
crowd funding by creating their own link for fund generation.
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LO-4: Methods of protecting business ideas with their advantages and disadvantages.
Task-1: Examining the different methods that organisations can use to build up, retain and
guard knowledge and logical property.
The innovation is something that every organization desire to have in organization. But to
generative innovative ideas is not easy. Organization who is going through the process of
innovation should take steps to protect against the leakage of the idea (Protection, 2017). If it
will be used by other organization it will lose its importance. The London Essence Company is
going to produce a low calorie soda. They can protect their idea by getting it registered according
to the rules and regulations. The organization can use tools like patents, trademarks, copyrights
to protect their ideas. They are discussed in detail below:
1. Patents: It is a tool for the organization to prevent their idea getting used by others. You
will hold the title of the product for the given period of time (Protection, 2017).It is
lengthy process but it is required for protection against loss. Lots of money is used in
funnelling of the innovative idea. If other person gets to know your idea all the efforts
and money will be wasted. London Essence Company is going to produce low calorie
soda drink. They should get it patented under name.
2. Trademarks: They are the words or the symbols registered under your name according to
rules and regulations of the government. The people who get them registered get the
rights to use them. The government allow using the specific trademark for a period of 6
year after which it has again to be registered (Gov.uk, 2017). The cost of registration is
less. The London Essence Company should get the trademark registered for the low
calorie soda drink.
3. Design Registration: The layout of the product can be made and got registered. This will
be done under the rules of the government and the rights of the product will be reserved
(Gov.uk, 2017). No other company with such layout can be registered. The idea will
remain innovative. London Essence Company can make a design of their low calorie
soda drink and get it registered.
4. Copyrights: It is the best way of protecting the ideas in different fields. The company can
use it to protect their annual reports, brochures and innovative ideas. It gives the
exclusive write to the company to utilize the product.
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London Essence Company can adopt the above said measures and reserve the rights of
producing a low calorie soda drink.
CONCLUSION
The time has changed and the demand of the customers is also changing. To meet the
current demand of the customers the organization has to be always innovative. The innovation
and commercialization require good research and development of the product. Innovation is
different from invention. Invention is one time but innovation is never ending process. It is
continuous in nature. To have the competitive advantage innovation is necessary. Innovation is a
three step process; Innovation is affected by the vision, mission, organization culture and leader
of the organization. The leader should be participative in nature then only the employees will be
innovative. London Essence Company can do product and process innovation. They are going to
introduce a new low calories soda drink. They can target new segment of the customer. In order
to protect their idea they can go through patent registration, trademark registration and design
registration.
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REFERENCES:
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Press. Available at
https://www.cambridge.org/core/books/innovative-entrepreneur/61215AB394EF7A377E
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BizExcell. Available at: http://www.bizexcell.com/innovation-and-4ps-of-innovation/
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