The Impact of Innovation on Business: A Comprehensive Analysis

This report examines the multifaceted impact of innovation on businesses, exploring its benefits, barriers, and strategic implications across various sectors. It analyzes innovation percentages in industries like telecommunications and agriculture, highlighting key benefits such as improved product quality, cost reduction, and enhanced consumer satisfaction. The report also delves into barriers to innovation, including funding issues, lack of skilled personnel, and regulatory compliance. A case study on Westpac's home loan application process is included, with a flow diagram and recommendations for improvement. The analysis draws on data from the Australian government and provides insights into innovation strategies for business development.

Running head: INNOVATION AND IMPACT ON BUSINESS
INNOVATION AND IMPACT ON BUSINESS
Name of the Student
Name of the University
Author Note

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INNOVATION AND IMPACT ON BUSINESS
Abstract
Innovation has various benefits to offer irrespective of the type of industry and services offered.
Innovation helps in improving quality of products by introducing advanced measures and
reducing product related errors. Innovation helps in automating production, which not only
improve production process, but also reduce cost for production as well. when product is
delivered to the consumer with out compromising in quality it automatically improves consumer
expectation and also enhance consumer satisfaction as well. hence innovation is important for
organizations to consider

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INNOVATION AND IMPACT ON BUSINESS
Table of Contents
Introduction......................................................................................................................................3
Discussion........................................................................................................................................3
Innovation Execution – integration and rejection........................................................................3
Innovation percentage and analysis.............................................................................................4
Innovation activity and how it is related with employment size.................................................5
Professional Services...............................................................................................................5
Scientific Services...................................................................................................................5
Technical service.....................................................................................................................5
Key Benefits achieved by introducing Innovation......................................................................5
Example of successful application of Innovation........................................................................6
Key Barriers of Innovation..........................................................................................................7
Regulation and Compliance for/against the Innovation..............................................................7
Graphical Demonstration for analysing Barriers to Innovation for all Industries.......................8
Interpretation of the graph provided............................................................................................8
Flow Diagram for Home Loan Application in Westpac............................................................10
Step by step description of flow chart of Home loan management system in Westpac............11
Recommendations for Westpac to improve the existing model................................................12
Conclusion.....................................................................................................................................12
References......................................................................................................................................14

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INNOVATION AND IMPACT ON BUSINESS
Introduction
Innovation provides various benefits which organisation need to consider. The fast and
one of the most significant benefits of innovation is the improvement of production no matter
what Industries organisation deals [1]. Innovation is always associated with bringing new
approaches to the production and delivery of services and provides an opportunity for reduction
in cost. Organizations brings innovation to replace existing or legacy system that is not
consistent with business requirements. However, replacing traditional system is often a complex
process, which requires detailed analysis and strategies for effective integration of innovation
with business process [2].
Discussion
Innovation Execution – integration and rejection
Although innovations provide various benefits to organisations, they are always not ready
to adopt innovation. Now there could be various reasons why some organisations prefer
innovations while others are reluctant in bringing innovation to the business process [3].
Organisations, which have much more financial resources and infrastructure support, are always
ready to experiment with new technologies as it provides business benefits [6]. However,
bringing innovation sometimes needs replacement of traditional systems and significant
investment. However, if the integration of the new system with traditional infrastructure is not
properly done it will result in financial loss. Organisations, which are not ready to experiment
with this process and accept the risk, associated with this, tend to reject innovation and develop

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INNOVATION AND IMPACT ON BUSINESS
strategies to improve with their old Legacy systems as it has minimal risk and it provides
benefits to the business [4].
Innovation percentage and analysis
Fig.1 – Innovation (in %) within the industries
(Source: Created by author)
Data Reference: www.abs.gov.au
Innovation is telecom industry is highest (www.abs.gov.au, 2019). This is because
telecom industry is highly innovative in nature and highly competitive. Service providers need
to offer highest quality of telecom related services such as internet, calling facility both
traditional, internet calling, and other modern services relevant in the industry. It is not only
quality of service that matters, cost has to be competitive as well. Providing quality services in
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 (%)

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INNOVATION AND IMPACT ON BUSINESS
less cost is what makes telecom companies to innovate continuously to sustain in coemptive
market.
Innovation activity and how it is related with employment size
Professional Services
Analysis of the data provides that as number of employees are reduced it tend to provides
more innovation compared to groups that has large number of employees. When number of
employees are large, chances of conflict between different ideas is high which affect innovation
process.
Scientific Services
Data analysis shows that like professional services, here also increase of employee size
affects innovation process. This is because overflow of original idea requires extensive analysis
to choose the most appropriate one that offers highest quality of innovation and that is consistent
with requirements.
Technical service
In technical service, innovation is required for resolving consumer issues and it depends
on individual expertise of the technicians. However, when group of skilled technicians works
together on a single issue it reduces time of resolving issues and ensure quality.
Key Benefits achieved by introducing Innovation
When organisations deliver product or services that are good in quality and cheap in price
it is always to be successful in the competitive market [7]. These two specifications of the cost
reduction and quality improvement are an important aspect of consumer satisfaction. When
consumers are satisfied, business is sure to excel. Hence, organisations considered innovation for

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INNOVATION AND IMPACT ON BUSINESS
the improvement of quality reduce time in production and reduction in cost and enhanced
consumer satisfaction [8].
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
Fig.2 – Innovation statistics in agriculture industry
(Source: Created by author)
Data Reference: www.abs.gov.au
From the chart, it is seen that innovation has brought significant benefits in agriculture industry.
44% revenue has been increased and 32.1% cost reduction is observed as well. 21.1% increased
has been observed in gaining coemptive advantage in the market. Innovation has also helped in
improving consumer service and overall increase of 17.3% is seen. However application of new
technology such as IoT, cloud computing has been considered as part of innovation whose

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INNOVATION AND IMPACT ON BUSINESS
effectiveness is yet to be measured. Such innovation whose benefits are yet to be measured
accounts for 26.8%.
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
 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
There are various of impact that is leveraged by the regulations on innovation of the
organizations. In this aspect it has been learned that there are three type of regulation which
impacts the innovations [4]. These regulations are the social regulations, economic regulation
and institutional regulations. Regarding most of the businesses various types of regulations
actually restricts freedom of the employees in many of the aspects [9]. Due to this factor the
chances of innovation within organization automatically deceases [5]. One of the prior example
of this case is Nesta. Nesta has faced a low amount of innovation within the organization as the
regulations within the organization was considerably high. Thus it can be stated that regulation is
currently having a negative impression on the innovation [10].

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INNOVATION AND IMPACT ON BUSINESS
Graphical Demonstration for analysing Barriers to Innovation for all Industries
Lack of Access to Additonal Funds
Cost of Development
Lack of Skilled Persons
Lack of knowledge or tech for
development
Government regulations
Adherence to standards
Uncertain demands for new goods or
services
0 2 4 6 8 10 12
Barriers to Innovation
Barriers to Innovation
Fig. 3 – Barriers to Innovation
(Source: Created by author)
Data Reference: www.abs.gov.au
Interpretation of the graph provided
From the above analysis, it is seem that the most significant berries that is associated with the
innovation process is lack of additional funds which means that innovation without funding is
not possible to execute effectively. The next significant barrier is the lack of skilled professionals
who are responsible for bringing innovation. Along with these two important barriers to
innovation, another important barrier to consider in this context is lack of demand for new

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product or service in the market, which means even if funding and skilled professional is
available, lack of demand for new products in the market affects innovation process.

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INNOVATION AND IMPACT ON BUSINESS
Flow Diagram for Home Loan Application in Westpac
Fig.4 – Flow Diagram Model of Home Loan application in Westpac
(Source: Created by author)
System login
Existing
Customer
?
Register
No
Pass
Validatio
n
Yes
No
Forget Password and
Reset Password
Provide personal
and loan details
Approval Check for
loan Eligibl
e
Yes
RP Data Property
Report
Terminate
No
Loan Approved
Signed Report
Not Signed

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INNOVATION AND IMPACT ON BUSINESS
Step by step description of flow chart of Home loan management system in Westpac
In order to apply for the loan consumer at first have to register with banking system and
this registration is done online. Now if a consumer is already registered, he or she needs to sign
in filling the details and if not, they have to register themselves first. Once the registration is
completed, new customers have to login to the system just like the registered customer. If an
existing or new customer forget, the password there have to choose the option to forget password
and change their password accordingly with new password. once new password is generated
customers have to log in to the system with password. Once consumer is successfully logged in
the system they need to provide various details such as personal information loan their applying
for, before the associated process begins. Once those information provided information of
checked properly and after verification home loan certificate is provided to the consumers. It
does not guarantee approve of loans it is provided 6 months before actually providing the loan it
is just a description of the financial status as verified by the bank. After issuing certificate if
consumer does not find any suitable property they have to apply for revalidation of the certificate
and this has to be done within 3 months after getting the home loan certificate so that it is
possible for the bank to evaluate that financial status of the consumer has not changed. Within
this time period once all the verifications are someone RPF data property certificate is issued.
However, it is important to consider that this certificate is not valid if it is not signed although no
Assurance is provided for the accuracy of the information provided in the data property
certificate. all of this process described in this context is completed and consumer is eligible to
get the loan from the bank.