Impact of Innovation on Business: Benefits, Barriers, and Analysis

This report examines the impact of innovation on business, exploring various facets such as innovation execution, integration, and rejection within organizations. It presents an analysis of innovation percentages across different sectors, highlighting key benefits like improved quality, cost reduction, and enhanced consumer support. The report also provides examples of successful innovation applications, particularly in the agriculture industry, and identifies significant barriers to innovation, including funding issues, high development costs, and a shortage of skilled personnel. Furthermore, it addresses regulatory and compliance aspects affecting innovation and includes a flow diagram for a home loan application process. The report concludes with a comprehensive list of references supporting the analysis.

innovation and impact on business

Introduction
Innovation in business refers to brining
new and improved approach that
improves overall business process
compared to solutions and methods
already available

Innovation Execution –
integration and rejection
Some organization tends to innovate
more than other while some
organizations tends to reject innovation
such due to lack of infrastructure, cost
increase and risk for implementation

Innovation percentage and
analysis
Agriculture, Forestry and Fishing
Mining
Manufacturing
Electricity, Gas, Water and Waste Services
Construction
Wholesale Trade
Retail Trade
Accommodation and Food Services
Transport, Postal and Warehousing
Information Media and Telecommunications
0.0 10.0 20.0 30.0 40.0 50.0 60.0
innovation percentage (%)

Key Benefits achieved by
introducing Innovation
Some of the important benefits of
innovation are:
 Improved quality
 Cost reduction
 enhanced consumer support

Example of successful
application of Innovation
Increased
revenue
Reduction in
costs
Gained a
competitive edge
Improved
customer service
Too early to
measure benefits
Other benefits Any benefits
0.0
20.0
40.0
60.0
80.0
100.0
120.0
benfits of innovation in agriculture industry

Key Barriers of Innovation
 Issues in accessing additional funds
 Development cost is higher
 Lack of skilled persons required within
the business is not sufficient
 skilled persons required has shortage
within the labour market

Key Barriers of Innovation
 access to knowledge or technology is
not easy
 Government regulations and
compliance
 Adherence to standards
 demands for new goods or services in
the market is not accurately
predictable

Regulation and Compliance
for/against the Innovation
 Affects innovation
 Restrict organizations to experiment
with business process and innovation
ideas

Flow Diagram for Home
Loan Application in Westpac

References
[1] Jensen, Morten Berg, Björn Johnson, Edward Lorenz, Bengt-Åke Lundvall, and B. A. Lundvall. "Forms
of knowledge and modes of innovation." The learning economy and the economics of hope (2016): 155-
182.
[2] Berry, Frances Stokes, and William D. Berry. "Innovation and Diusion Models in Policy Research."
In Theories of the policy process, pp. 263-308. Routledge, 2018.
[3] Christensen, Clayton M., Michael E. Raynor, and Rory McDonald. "What is disruptive
innovation." Harvard Business Review 93, no. 12 (2015): 44-53.
[4] DiMasi, Joseph A., Henry G. Grabowski, and Ronald W. Hansen. "Innovation in the pharmaceutical
industry: new estimates of R&D costs." Journal of health economics 47 (2016): 20-33.
[5] Visnjic, Ivanka, Frank Wiengarten, and Andy Neely. "Only the brave: Product innovation, service
business model innovation, and their impact on performance." Journal of Product Innovation
Management 33, no. 1 (2016): 36-52.
[6] Eesley, Charles E., and William F. Miller. "Impact: Stanford University’s economic impact via
innovation and entrepreneurship." Foundations and Trends® in Entrepreneurship 14, no. 2 (2018): 130-
278.
[7] Wheelen, Thomas L., J. David Hunger, Alan N. Hoffman, and Charles E. Bamford. Strategic
management and business policy. Boston: pearson, 2017.
[8] Dunne, Timothy C., Joshua R. Aaron, William C. McDowell, David J. Urban, and Patrick R. Geho. "The
impact of leadership on small business innovativeness." Journal of Business Research 69, no. 11 (2016):
4876-4881.
[9] Apanasovich, Natalja, Henar Alcalde Heras, and Mario Davide Parrilli. "The impact of business
innovation modes on SME innovation performance in post-Soviet transition economies: The case of
Belarus." Technovation 57 (2016): 30-40.
[10] Oh, Deog-Seong, Fred Phillips, Sehee Park, and Eunghyun Lee. "Innovation ecosystems: A critical
examination." Technovation 54 (2016): 1-6.

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