Innovation and Commercialization in Associated British Foods

Desklib provides past papers and solved assignments. This report analyzes innovation and commercialization strategies.

Running Head: Innovation and Commercialization
Innovation and Commercialization

Innovation and Commercialization
Table of Contents
Introduction......................................................................................................................................4
Overview of the Organization.........................................................................................................4
LO1 – Context for innovation and the difference between invention and innovation....................5
Innovation and importance of the same to an organization in comparison to invention [P1].....5
Significance of organizational vision, leadership, culture and teamwork for shaping innovation
and commercialization [P2].........................................................................................................5
Analysis of the different sources of innovation, the different ways in which organizations can
foster and develop an environment and culture of innovation [M1]............................................6
Critical analysis of the ways in which innovation is developed, embedded and measured in an
organizational context [D1].........................................................................................................7
LO2 – Different types of innovation...............................................................................................8
4Ps of innovation and use of innovation funnel to examine and shape innovative ideas [P3]....8
4Ps of innovation......................................................................................................................8
Innovation Funnel.....................................................................................................................9
Developments in frugal innovation and examples of how it is used in an organizational context
[P4].............................................................................................................................................10
Analysis and application of innovation funnel in an organizational context [M2]....................11
Evaluating the role of frugal innovation in an organizational context [M3].............................11
LO3 – Process required commercializing innovation...................................................................12
Importance of the commercial funnel and the application of a New Product Development
(NPD) processing for commercialization of innovation [P5]....................................................12
Building an innovation business case for an organization, including ways to access funding
[P6].............................................................................................................................................12
Building a detailed innovation business case that includes measuring the overall effectiveness
using appropriate techniques available to test, iterate and improve [M4].................................13
2

Innovation and Commercialization
LO4 – Evaluating the range of methods for protecting ideas and understanding their advantages
and disadvantages..........................................................................................................................13
Evaluating the different tools that organizations can develop, retain and protect knowledge and
intellectual property [P7]...........................................................................................................13
Supported evidence-based evaluation of these different tools in the context of the wider
business environment for entrepreneurs [M5]...........................................................................14
Critical evaluation of the nature of innovation and context in which it is developed, providing
evidence-based judgments on how organizations can overcome challenges to develop
successful innovations [D2].......................................................................................................14
Conclusion.....................................................................................................................................14
Reference List................................................................................................................................16
3

Innovation and Commercialization
Introduction
The existing scenario of business environment demands a high level or competitiveness from the
companies that are operating in the market. Hence, it is necessary that the companies keep the
benchmark of competition at a significantly high level. The pursuit of constant invention of new
products to satisfy the needs and demands of the customers is highly important and ensures that
the companies constantly work towards improving their products and services from the
customers’ perspectives. It is also very important that the organization constantly implement
innovative services in their products to make them better. The following task has specified the
major differences between invention and innovation and has also described. The study has also
identified the importance of innovation and invention from an organization’s perspective and
how it can bring benefits to the company. The details about frugal innovation and innovation
funnel have also been stated briefly along with some examples. The importance of protecting the
intellectual properties of an organization along with the different methods to do the same has
been discussed. A UK based organization has been considered for the study and the different
aspects are stated according to the operations and functioning of that company.
Overview of the Organization
The organization considered for the study is the Associated British Foods Limited which is a
large scale public limited company operating in food processing and retailing sector. The
Organization was established in the year 1935 in London, United Kingdom and has its
headquarters there since then. The organization is currently headed by Charles Sinclair who is
the chairman and George G. Weston who is the chief executive officer of Associated British
Foods Limited. The products include packaged food items and several ingredients which are
required as groceries for household daily purposes. There are 137,000 employees who work with
this company at locations present in over 50 countries across all the continents. The revenue
generated by this organization on an annual basis is £15.6 billion. The organization aims towards
providing affordable and nutritious foods and also clothing at economic crisis to its customers to
deliver a value for money. The products and services range from grocery to agriculture, sugar,
ingredients and retail sector businesses. It has many subsidiaries registered under its brand with
Allinson, Askeys, Argo, Baking Mad, and Billington’s being the most popular ones.
4

Innovation and Commercialization
LO1 – Context for innovation and the difference between invention and
innovation
Innovation and importance of the same to an organization in comparison to
invention [P1]
The primary difference between innovation and invention is that innovation stands for making
any existing thing better on several parameters like cost effectiveness, quality, size, and several
other things and invention stands for inventing or developing an entirely new thing that does not
exists in the market. Innovation is done in order to enhance the quality of an existing product.
This is also very important so that the organization can make any product or service more
efficient which can ultimately result into a better profit margin for the organization. On the other
hand, invention is about using technological advancements to introduce an entirely new product
or service. The difference between invention and innovation also exists in terms of intellectual
property rights. There is no intellectual property for innovation related purposes but there are
several techniques to reserve the property rights for an invention which include majorly
copyrights, patents, and trademarks. It is very important for every organization to focus on both
innovation and invention so that they can stay ahead in the competitive market. Innovative
products are likely to attract more customers because they find it advantageous to use the
products which are new in the market. Similarly, inventing new things can replace the old
fashions objects in the market providing a better medium of lifestyle to the customers and a more
productive method of doing business for the company (Bigliardi and Galati, 2016).
Significance of organizational vision, leadership, culture and teamwork for shaping
innovation and commercialization [P2]
In order to establish a successful foothold in the market, it is very important for the business
organizations to ensure that there are some key elements required. This includes having a proper
vision for the employees and the leadership department. A well defined and clear vision gives a
specific objective to the organization based on which the activities can be planned and strategies
can be decided. It is necessary that the people working for the company are able to put in their
best efforts to meet the objectives at personal and organizational level. Apart from having a
proper vision, it is also important to have an effective leadership as well as proper work culture
and teamwork (Saguy, 2016).
5

Innovation and Commercialization
Having an impactful leadership is very important because an effective leader is capable of
motivating the employees to put in their best efforts towards the betterment of the production
services delivered by their company. The presence of an effective leadership ensures that there is
no conflict among employees at any levels. Moreover, it also makes sure that the different
problems faced by an organization while conducting the operations have necessary solutions.
The prime responsibility of the leadership designation holders in any organization is to make
sure that all the operations are being performed in an appropriate way and there are plenty of
solutions available to resolve any issue. It also encourages innovation within the company that is
useful for any business in long term profit. A strong leadership results into proper team building
and teamwork due to which the members working in a particular team can develop a proper bond
among each other. Working in a team reduces conflicts due to which the organization leadership
does not needs to spend time while addressing its employees regarding individual differences.
Hence, it enhances the productivity of the organization at every level and helps it make the better
products to sustain in the market (Galati et al. 2016).
The work culture of an organization is also very important in terms of maintaining the dignity of
the organization. The work culture of a company is about the values and beliefs that are followed
by the employees while working for the company. The organization needs to have well set
defined values in its culture that needs to be reflected in the work practices performed by the
employees. Having a proper work culture ensures that the company has a high reputation among
its customers which is likely to gain profits for the company by getting more customers.
Moreover, an organization with a good culture of work is also likely to receive applications from
many talented people which will help up the Human Resource Department higher the best
potential for its future endeavors (Arcese et al. 2015).
Analysis of the different sources of innovation, the different ways in which
organizations can foster and develop an environment and culture of innovation
[M1]
An organization can derive the inspiration of providing innovative services and products to its
customers from many sources. The sources of innovation for different organizations are to be
different depending on the fields and industries that those companies corporate in. The primary
source of innovation for an organization working in the food and retailing sector industry can be
6

Innovation and Commercialization
something that is highly in demand on the customers but not very high in terms of supply in the
market. According to the products and services delivered by the Associated British Foods
Limited to its customers, there are many people who consider organic food to be healthy for
living because of its healthy ingredients. However, growing organic food is very expensive due
to the lack of healthy advanced techniques that can reduce the cost. Hence, the organization can
easily develop a culture of innovation in its workplaces and premises by promoting and
encouraging innovation from the employees (Pinna et al. 2018).
It is very important that the topmost leadership of the company invests in research and
development sector of the company so that the overall business can benefit from the innovative
outcomes from the research. The organizations need to Foster and develop the culture and
environment of innovation within its workplaces. Accepting innovative ideas and encouraging
the employees to provide new and unique techniques of improving the services are also very
helpful. The senior leadership of Associated British Foods Limited deals with many types of
food items and therefore the profit share is likely to be from different sectors. Hence, a
significant amount of money must be invested in research and development so that new and
innovative products can be developed. The ideas of innovation can also be taken from foreign
sources like the drip irrigation techniques that has been invented in Israel. The development of
new fertilizer that can help grow nutritious food in infertile soils can also need the company to
successful destinations. Hence, the organization needs to hire a capable and potent workforce
consisting of chemical engineers and scientists who can find out the formula for helpful
fertilizers that can produce strength and nutrition to the crops without any side effects (Caiazza
and Stanton, 2016).
Critical analysis of the ways in which innovation is developed, embedded and
measured in an organizational context [D1]
The best way to develop innovation within an organization is to provide the employees with
adequate opportunities to showcase their talents. In addition to this, the organization
management needs to expand its domain from production and retailing sector to research and
development field. This is important because establishing research and development facilities
allows the organization to invest in the right areas that are likely to deliver positive outcomes for
the company. Innovation in an organization can be embedded in the form of new products and
7

Innovation and Commercialization
services. For an organization like the Associated British Foods Limited, innovative items can not
only be from the food sector but they can also be from services like investment in rainwater
harvesting and other activities that encourage environment friendly results. One of the most
important factors of innovation in the existing scenario is environmental protection. Hence, the
organization can establish its research and development facilities so that a the scientists and
researchers can find multiple ways to develop any product. The organization can also implement
innovative ideas for packaging and processing of food items which will bring down the total cost
of operation further increasing the profit margin for the company (Sharma et al. 2016).
LO2 – Different types of innovation
4Ps of innovation and use of innovation funnel to examine and shape innovative
ideas [P3]
Innovation can be implemented in any organization with the help of several models and theories.
One of the most populous concepts of implementing innovation in the functioning of any
organization is 4Ps of innovation. In addition to this, the innovation funnel is also a very useful
tool that can be used to implement the innovative ideas into actual production of the business
items.
4Ps of innovation
In order to establish and innovative business process in the market, the company can follow the
concept of 4Ps of innovation. This includes four major factors based on which innovative ideas
can be developed and implemented in the company processes. This particular model is also very
useful for the Associated British Foods Limited because it has a wide variety of food products
and ingredients to be sold to its customers. Following are the four dimensions of this model that
encourage innovation among the companies.
Product: The Company needs to decide about the exact product or service that it is planning to
deliver to its customers. The organization also needs to ensure how that particular product is
different from those products already existing in the market. The product needs to be in
accordance to the demands of the customers and should meet up to their expectations (Laužikas
et al. 2016).
8

Innovation and Commercialization
Paradigm: The paradigm factor is regarding the brainstorming of different techniques that can
be used for the betterment of an existing product or service. This is about the positive approach
that at the company researchers needs to have in order to reduce the total expenses of the
company and increase the profit from the return of investment.
Process: The process factor is about conducting the overall activities of the entire business
model. This includes involving of innovative techniques in doing the other activities apart from
research and development like marketing, transportation, collection of feedback, and other
similar activities. The primary aim is to reduce the expenses without compromising quality
(Ming et al. 2016).
Position: The position factor is about appropriate positioning of the products in the market. The
marketing and research department needs to analyze the areas where the products are to be
launched on the basis of geographical, ethnic, environmental, and cultural factors. The selection
of a particular target population on the basis of age group and financial status is also very
important.
The Associated British Foods Limited can easily make use of this principle to identify the areas
where the launching of its innovative products can fetch the maximum benefits. According to the
existing scenario, the best way to implement innovation is to invest in developing organic
farming and bringing the organic products to the customers at a cheaper cost. The total expenses
need to be reduced which will ultimately result into the reduction in the final cost that is to be
paid by the customers without compromising in the quality of the products.
Innovation Funnel
The implementation of every innovative idea requires the management of the companies to be
specific. The implementations of ideas needs to be done in a set of steps in which some specific
activities are performed depending on the requirements of the entire innovation model and
project. The first step is generally about the collection of ideas primarily and the last step is about
making the actual use of the ideas at ground levels. The stages of innovation final are likely to be
different for different organizations depending on the type of innovation and the domain of
operation. Following are the major steps that are involved in the innovation funnel considering
the business of Associated British Foods Limited.
9

Innovation and Commercialization
 Step 1: Collection of ideas – The full step will include collecting different innovative
ideas from different sources that can potentially left of the business in terms of financial
profit and reputation. The ideas can also be about enhancing the quality of products and
reducing the total cost of any product that is paid by the customer.
 Step 2: Screening those ideas – The second step is about conducting a brief analysis
about the positive and negative aspects of those ideas along with their total investment
and their returns. The hardware that needs to be purchased along with the machinery to
build the entire system will be analyzed on the basis of cost and their potential returns
(Schaltegger et al. 2016).
 Step 3: Selecting the best idea – The best ideas that have been identified about their cost
and returns are to be selected and a final analysis has to be done about the specific
expense that the company needs to spend along with the total distance that they are likely
to receive. The Associated British Foods Limited can invest on the robotic automation
machinery to speed up the production line. Moreover, selection of new researchers and
scientists is also equally important as they will help the company find out in production
methods and products.
 Step 4: Commercializing – The final phase is about implementing those ideas and start
producing the innovative products on a commercial scale for the customers. This results
into the earning of profit by the company in terms of financial benefits and company
reputation (Tell et al. 2016). The Associated British Foods Limited after finding the
innovative techniques to produce organic food items at cheaper costs needs to start
producing those items at a commercial level.
Developments in frugal innovation and examples of how it is used in an
organizational context [P4]
The term frugal innovation means to reduce the overall complexity of process while developing
any product or service and delivering the same to the customers. The results of implementing
frugal innovation techniques are highly beneficial for the organizations because any Complex
operation can be easily done using simplified techniques. Frugal innovation is very useful for or
food companies like Associated British Foods Limited because it reduces the total materialistic
infrastructure required to be interested while developing any production ecosystem. The
10

Innovation and Commercialization
containers that are used to carry food items from one place to another are made up of some
expensive materials. Hence, the company managers and strategists can think about using lighter
and stronger items to make those containers so that they can sustain the weight it of the items as
well as transport the same more efficiently. The light weight products will also be easier to be
carried by the heavy duty vehicles which will reduce the carbon emission and will make the
entire logistics process more fuel and cost efficient. The organization can also simplify its
structure of production line to reduce the time taken by a product to become ready for
consumption from the stage of initial processing to packaging (Blok et al. 2015).
Analysis and application of innovation funnel in an organizational context [M2]
The Associated British Foods Limited is a huge organization with almost 137,000 employees
working in 50 different countries. Hence, the possibility of receiving innovative ideas is very
high and the company is likely to get many ideas to enhance its products and services in terms of
quality. However, it is important to identify the useful ideas and segregate them from those
which are not very useful. Hence, the Associated British Foods Limited can use the strategies of
innovation funnel and carry out different activities in different stages so that the most effective
ideas can be brought into action. It needs to develop a team of thinkers consisting of experienced
working members who can identify the useful innovative ideas and hardness the raw talent from
internal as well as external sources (Franceschelli et al. 2018).
Evaluating the role of frugal innovation in an organizational context [M3]
Frugal innovation also plays a significant role in reducing the cost of the products that are finally
delivered by the organization. The highly competitive environment demands the production of
waste products in terms of quality without increasing the cost factor. An organization is more
likely to receive a huge number of customers if best quality products are delivered to them at
cheaper prices. As an example of frugal innovation, the Associated British Foods Limited can
regulate its logistical operations in a more specific hue. The vehicles used for logistics and
transportation usually carry a particular load of goods and therefore it is important to make the
vehicles more efficient in terms of goods carrying capacity. A huge portion of the load carried by
the vehicles is of the metal containers and holders in which the items are loaded. Hence, instead
of caring solid metal containers, the organization can reduce the weight by using iron fishnet
structured containers for the transportation of its food products (Moreno-Luzon et al. 2019).
11

Innovation and Commercialization
LO3 – Process required commercializing innovation
Importance of the commercial funnel and the application of a New Product
Development (NPD) processing for commercialization of innovation [P5]
Commercial funnel is very important for every organization in order to identify the specific areas
that can lead to profit for the company. The most useful ideas can be selected from a pool of
ideas and can be implemented according to the objectives and requirements of the company as
well as the customers’ demands. The New Product Development or NPD process is highly useful
and reliable in terms of commercializing any innovation. The new product development process
gives a clear idea about how the different innovative ideas can be used to enhance the processes
of company operations. There are several pages starting from the conceptualization of different
ideas and products to finally launching the same. The NPD process is very helpful for Associated
British Foods Limited in order to enhance the capacity to reach out to many people and also to
implement new ideas in the entire business ecosystem. The best advantage of an NPD process
system is that it can be applied in every department like production, marketing, promotion, and
even research and development purposes (Trott and Simms, 2017).
Building an innovation business case for an organization, including ways to access
funding [P6]
In order to make the company progress at a faster rate and establish a strong foothold in the
market of several domains, it is very important that new products are launched in the market.
Hence, the development also needs to be carried out considering the demands and requirements
of the target customers segment. As per the existing scenario, more people are becoming aware
of the importance of organic food it in order to stay fit and healthy. Hence, they prefer to
consume foods that contain less amount of fat. However, due to the high cost of the organic
products, the target segment is very less. Hence, innovative techniques like using highly efficient
fertilizers can be developed so that the total cost of growing the organic food can be brought
down.
The project can be funded from different shareholders of the business for which the effectiveness
of the idea needs to be explained to the shareholders. A market survey will be conducted to
identify a rough estimation about the number of people who you prefer to have organic foods.
12