Innovation and Enterprise: A Report on Nestle's Sugar-Free Chocolate

This report provides an in-depth analysis of Nestle's innovation strategy, focusing on their new sugar-free, protein-rich chocolate bar. It begins with an introduction to innovation and its significance in the business world, specifically highlighting Nestle's commitment to staying competitive. The report then delves into various innovation theories, including incremental and disruptive innovation, and how Nestle applies them. It evaluates the strengths of the sugar-free chocolate, such as its health benefits and market appeal, while also acknowledging shortcomings like competition and potential consumer skepticism. The report proposes an implementation plan for the product, detailing the stages from idea generation to commercialization. Finally, it suggests ways to overcome the product's weaknesses and concludes by summarizing the key findings and recommendations for Nestle's innovation efforts. The report uses Nestle as a case study to illustrate the practical application of innovation theories and strategies in the food and beverage industry.

Innovation &
Enterprise

Table of Contents
INTRODUCTION...........................................................................................................................3
TASK ..............................................................................................................................................4
Various theories of innovation and idea generation for the product...........................................4
Evaluation of the product by stating the strengths and shortcomings ........................................5
Proposal for innovative product and the development of implementation plan.........................6
Suggestion to overcome the shortcomings in the product..........................................................8
CONCLUSION................................................................................................................................8
REFERENCES................................................................................................................................9

INTRODUCTION
Innovation refers to the creation of something new. In Innovation the entrepreneur brings
a new idea and work upon it to make a whole new product or service. Innovation also refers to
make a new modification, addition of a new feature, to the existing field, service, idea or to any
product. Innovation is a continuous process. Through innovation the lives of people has become
very easy and comfortable as the task are now get done with an ease through technologies. Every
organisation now tries to strive the competitive advantage through innovation. They attracts the
customers by bringing up the new technology which make the lives of people more easy and
comfortable. Bringing the continuous innovation has helped the organisation in surviving into
the market place and not become obsolete. For reference purpose this report has taken an
example of a company, Nestle. Nestle is a Swiss multinational company which has engages its
business in manufacturing of products related to food and beverage. The company was establish
in the year 1866 by Henri Nestle. Some of the major products which company manufactures
include Coffee, chocolates, baby food, confectioneries, ice cream and so on. Nestle has its
headquarters in Vevey, Switzerland (Cao and Zhou, 2018). The company to maintain the
competitive advantage or upper hand into the market always comes up with new and innovative
products. And to maintain the same, Nestle has now come up with a new product in its chocolate
segment. The company has bring up a sugar free chocolate by analysing the trend among the
customers for eating low fat foods.
This report discusses about various theories of innovation along with the various merits
and demerits that product has in it. Apart from this the report also includes some suggestions
which can surmount these weaknesses which are present in product.
TASK
Various theories of innovation and idea generation for the product
Innovation plays a paramount role for any organisation. It is said to be a process through
which an entrepreneur brings up something new and innovate in the market. It also refers to the
process of developing the exiting product in the more better way irrespective to the field,
industry or sector it belongs. Innovation enables the organisation to survive into the market place
and gain the competitive advantage by bringing up the innovative products. Although innovation
is something which is very time consuming process, needs to a lot of investment in R&D's and

requires and lot of research and trail work. In this cut throat competition, it is very much
necessary to bring up the continuous innovation. Likewise Nestle has come up with an
innovative product in its chocolates segment (Castaldi, Block and Flikkema, 2020). It has bring
up a chocolate bar which is high in protein and also sugar free. By analysing the market trend,
taste and preferences of customer the company observed that now a day the people has become
very much concern towards their health and their eating habits. People avoid eating the food
which is not healthy for their body. The chocolate bar which Nestle has innovate is sugar free
and the ingredients present in it provides protein to the eater. The bar is totally made for the
people who is health freak and believes in eating healthy. There are various types of innovations
which Nestle can use in its product manufacturing. These type of innovations are as follows:
Incremental Innovation: The incremental innovation refers to that type of innovation in which
the entrepreneur brings the new change by adding some features to the existing product in the
existing market. The Incremental innovation is the most common type which is practice by
almost every organisation. As in the case with Nestle company, it brings the incremental
innovation in their every segment. For example in their baby food segment, the company has
come up with various flavour of Cerelac like rice and apple, wheat, vegetables, whole grains and
much more. They have come up with Cerelac as an innovative product and now with the use of
incremental innovative the company is adding with the new feature with the base product.
Disruptive Innovation: It is also known as Stealth innovation. It is that type of innovation in
which the organisation adopts a new technology in its operational department. With the changing
time, the current technology becomes obsolete and new technology provides more benefits and
efficiency to the organisation. The new technology enables the organisation in producing the
more units of products with lesser costs. As in the case with Nestle, it has bring the technological
change in its operational or production department when required (Cheng, Cheng and Zhuang,
2019). The company has never compromised with its production activity and always tries to
adopt that technology which provides more productivity to the organisation. With the time the
presence of Nestle has become worldwide and the technology which is used by the company
needs to get very advance so that they can meet the demand of such a huge market.
The innovative idea for bringing up the sugar free protein chocolate bar involves both
type of innovation which is stated above. The company has add up a new feature to its existing
chocolate segment, which is an incremental innovation, and to distribute the same product in a

large market the company would be requiring that technology so that they can produce such
units. This innovation in technology involves the disruptive innovation as the technology used by
the company would help in satisfying the demand which may arise for this sugar free protein
chocolate bar. The production would be carried out in a large amount. Due to this the supply
would be possible in the large market. Nestle has adopted such technology which can help the
company in matches with the product demanded in the market.
Evaluation of the product by stating the strengths and shortcomings
Nestle has come up with an idea of bringing up a whole new chocolate bar for the people
who are very much concern towards their health and eating habits. The bar will be totally sugar
free which will prevent the intake of fat. Also the bar have the ingredients which provides the
protein to the eaters. The company has grab the opportunity by analysing the need and
preferences which is running among the consumers with regard to type of food habits they are in
taking. It has been analysed and observed that the customers have become very much conscious
about their health and has become very specific about the things they are consuming (Cohen,
2017). The idea is very innovative which works as a strength but meanwhile it suffers from
various shortcomings also. The strength and weakness for the sugar free protein chocolate bar
can be as follows:
Strengths:
 The biggest strength which can be consider in this product is that it is sugar free and full
of protein. The product is specifically made for the consumers which are diet conscious
and consumes only healthy food. Now majority of people has become very mindful
towards their health and this particular concept will get increase with the time.
 This chocolate bar can be get consumed by anybody irrespective to their age group. As
this product promises the consumers to be healthy and free from any harm, it can get
consumed by diabetic patients, gym freak people as it has protein in it, sports persons and
any other layman.
 The consumption of this product would also contributes in providing the energy to the
consumers as it contains protein in it (Coulson-Thomas, 2017).
Shortcomings:

 Although the product is free of sugar but it does contain some percentage of carbohydrate
in it. Therefore the people like sports persons, gym freak and the like should consume it
in a low quantity.
 The level of competition which is prevailing in to the market place also works as
shortcoming for the product. There are number of other companies which are using this
concept. The other competitive company can provide the same product with same
features in comparatively lower prices.
 The low acceptance of product among the consumers can be a great drawback for the
company as most of the customers have the perception of sugar containment in the
chocolates. It will be quite hard for the company to make these people convince so that
there perception can get changed and they start consuming this sugar free chocolate.
 Apart from this the product has another risk that whether it will run into the market place
for not. The manufacturing of this new sugar free chocolate is an experiment done by the
Nestle company and the sales or success would totally depends the acceptance by
consumers. If the consumers do not like the taste of the product then the product could be
a big flop for the company (Cusumano, 2016). But if the taste get set by the customers
then the product could be a big success for the same.
Proposal for innovative product and the development of implementation plan
Step 1. generation of idea: It is the first stage for the development of innovative product
development. For the development of product it is very necessary to have an idea generation
upon which person can work. Through the idea only the further steps could be taken and
procedure for developing it can be followed. The idea which is generated then needs to get pass
from various physical and logical stages. As in the case with Nestle company, the idea which is
generated is about manufacturing of chocolate which is sugar free and that also contains some
healthy ingredient in it. For that the company has decided to put proteins in it in the form of nuts.
The company's purpose is to show cast the importance of being healthy by providing this
particular idea.
Step 2. Advocacy and screening: After going through the first stage, the idea then get
analysed from its pros and cons. The whole idea gets analysed and its feasibility is being
analysed that whether this idea can get work in the market place or not. The idea is analysed in
every scenario so that strong judgements can be created about it. As in the case with Nestle

company, the idea to bring sugar free protein bar also got through to many stages which makes
the idea feasible to pursue. This has shifted the process of innovating and developing this idea to
next higher level.
Step 3. experiment: In this step the organisation decides the target market upon which
they need to market their product. The company first manufactures a small units for production
and then try to sell it in a small size market. The company tests the product through this and if
the product gets a success in that market then the product will produce for the larger scale. And if
the product gets failure in the market then it would called off. As in the case with Nestle
company, the same has happened (Patricio, 2017). The company produce a small unit of
products which it sells at a small sized market just to test for its feedbacks and reviews. After
testing for the same the company would observe the product feedbacks and review and if the
same is positive and the production will take for larger market.
Step 4. Commercialisation: In this process the company's higher authority would review
all the feedbacks and opinions which customers had made upon the product. Taking all these into
consideration the company would be able to understand the actual need and want of the market
so that they can mould their product accordingly. As in the case with Nestle, the reviews and
feedbacks which the company has received with regard to their sugar free protein chocolate bar
can work as a improving factor. They can use these for making their product in accordance with
all these review which they have received. This would increase the chance for the product to get
accepted into the market easily.
Step 5. diffusion and implementation: This is the final stage in the process. In this the
product gets released into the market place. To educate the large mass of people Nestle needs to
use some advertising and promotional method at the larger scale. The product gets implemented
into the market for the customers get purchase.
The above stated model helped the company, Nestle, in developing and implementation
of new and innovative product into the market. This process has helped the company in
establishing the product easily by checking out its feasibility factors.
Suggestion to overcome the shortcomings in the product
By bringing the necessary improvements into the product the company would be able to
make the product features strong so that it could rum successfully in the market and attains the

competitive advantage. The new product of Nestle company also has various shortcoming and
following suggestions can be used to overcome the same:
 The company should provide that sugar free chocolate bar in all sizes ranging from small,
medium and large. This can help the company in getting an increase in its sales because
the consumers can purchase the chocolate according to their need. For example, a sports
person wants to eat this chocolate but could not eat it because the availability of the same
is in larger size that can increase in carbohydrate intake for that person. Therefore it
would be beneficial if the company provides the product in all the available sizes.
 The company also can use the effective strategies like cost differentiation strategy so that
it can gain competitive advantage into the market place. Cost differentiation is the
strategy in which the company gains the competitive advantage through the price offered
for the product by the company. The price set so releasable which can afford by people.
The company needs to take competitive advantage in the market if it wants to beat with
the competition which is present (Pisoni, 2019).
 The Nestle company can take the help of social media marketing for promoting and
advertising the product in the large mass of people within a little span of time. The social
media has the ability to reach to the large number of audience within a short period of
time. This method would also enable the organisation to also maintain the direct
communication with their followers so that they can educate the same about the product
properly. The social media marketing is something which is very new and have boom in
the market with regard to marketing method (Saji and Nair, 2018).
CONCLUSION
From the report presented above, an idea about the product as been present about Nestle
company's product. The idea is to manufacture the sugar free protein chocolate bar into the
marketplace. The company for innovating the product has used the incremental and disruptive
innovation. The company has also make the use of product innovation and development model
for to test the feasibility of idea till diffusing the product into the market place. Some of the
suggestions are also provided to the company to surmount their shortcomings. The suggestion
may include use of social media advertising, availability of the product in all available sizes and
etc.

REFERENCES
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