Lack of Innovation: Reasons Behind Entrepreneurial Downfall Analysis

This essay discusses the critical role of innovation in entrepreneurship, highlighting how a lack of it can lead to business failure. It examines the managerial and commercial functions of entrepreneurs and emphasizes the importance of technology adoption and unique product development to meet changing market demands. The analysis points out that failure to innovate results in similar products, high manufacturing costs, and ultimately, a loss of customers, leading to entrepreneurial downfall. The essay concludes that innovation is essential for entrepreneurs to achieve success and sustain growth in the competitive market.

Entrepreneurship and Innovation

INNOVATION 1
Introduction
Innovation is a new idea, imagination, and a creative thought of a person that meet the new
requirements, unarticulated needs with the existing market needs. The entrepreneur uses innovation to
develop its business at the international level. In this report, Lack of innovation is a reason behind the
entrepreneur will be discussed.
Role of entrepreneur
Managerial Functions
Management function is the important function in the terms of organisation structure. It is the process
of done things through others. Entrepreneurs have the responsibility to maintain this process that
includes the activities such as planning, organising, coordinating and controlling. These are the factors
which are included in the managerial function of the organisation.
Entrepreneurial Functions
The main function of entrepreneurs is to bear risk and use the innovative method in order to develop
the business.
Commercial Functions
The entrepreneur also has the responsibility to collect the money for funding the business. It is the
main function of an entrepreneur because no business can survive in the market for long time without
enough money and funds. Innovation is a method from which the entrepreneur can save money from
the manufacturing cost of product by using new techniques and methods.

INNOVATION 2

INNOVATION 3
Lack of innovation
Technology Advancement
As technology develops, the demand of consumers is also getting change towards the goods and
services. Technology is also an innovation of the experts that helps to develop the devices to make the
production process easy. Nowadays, technology is playing a role as an asset of the company and it can
be said that it is necessary for the entrepreneur to adopt the new technology for the high growth in the
market. If the entrepreneur does not adopts the new technology than they face the issues about the
demand for goods and services (Maura, 2017).
Similar Material
Lack of innovation is the reason of similar product which is provided by the entrepreneurs in the
market. Innovation is necessary for entrepreneur to attract a large number of the customer towards
goods and services of their business. As per the consumer perspective, they want the new things that
satisfy their demand as per their requirement. The entrepreneur has to develop a unique product with a
new idea and method. Lack of new idea increases the risk of losing customer which is the failing point
of every entrepreneur.
High cost
As technology is developing in the form of devices and method, the entrepreneur can change their
method to develop the product in the market. There are many new methods that can be adopted by the
entrepreneurs to reduce the cost of manufacturing product. Innovative machines can reduce the wage
cost of the product which is beneficial for the entrepreneur. Lack of innovation means the old method
and technology used by the entrepreneur which increases the cost of manufacturing and increasing
debt that is the reason for entrepreneurship failure (Gascó, 2017).

INNOVATION 4
Conclusion
From the above analysis, it has been seen that the entrepreneur takes the financial risk in order to
grow the business at a higher level. Innovation is an essential factor for the entrepreneur in order to
achieve success in the market. Lack of innovation is founded as the main reason behind the failure of
entrepreneurship.

INNOVATION 5
References
Maura. (2017) Lack of Innovation is a Corporate Issue. [online] Available
from:https://maurathomas.com/corporate-productivity/lack-of-innovation-corporate-issue/ [Accessed
27/2/19].
Gascó, M. (2017) Living labs: Implementing open innovation in the public sector. Government
Information Quarterly, 34(1), pp.90-98.