Innovation Management Report: Benefits, Limitations, and Analysis

This report delves into the critical aspects of innovation management within a business context. It begins by establishing the significance of innovation management and its role in driving organizational success, emphasizing its connection to change management and ISO 56000 standards. The methodology employed involves a detailed review of secondary data sources, focusing on qualitative analysis to explore the benefits and limitations of open innovation. The report highlights the importance of innovation management for organizations, including fostering a collaborative workforce, facilitating decentralization, and driving sustainable practices. It also provides an in-depth examination of open innovation, outlining its advantages such as increased access to talent, competitive advantages, reduced costs, and enhanced employee engagement, while also acknowledging its limitations. The report concludes with a synthesis of findings, offering insights into effective innovation management strategies and the importance of open innovation in achieving business objectives.

Innovation
Management

Table of Contents
INTRODUCTION...........................................................................................................................3
Detailed methodology......................................................................................................................3
Literature review:.............................................................................................................................4
To determine the benefits and limitations of open innovation...............................................6
Benefits and Limitations of Open Innovation........................................................................6
Critical evaluation............................................................................................................................9
Commercially available solutions:.................................................................................................11
CONCLUSION..............................................................................................................................11
REFERENCES..............................................................................................................................12

INTRODUCTION
Innovation management is a very crucial aspect of every business as it part of combing
the overall process of innovation and change management. It is regarded as the product, business
process or marketing activities where the main aim of each activity is to focus on organizing the
innovation process. Innovation management is generally a series of standards that are
development and is part of ISO 56000 (Tidd and Bessant, 2018). Present report is based on the
discussion of the way innovation is management of innovations in business in such a way that it
can result into maximum benefit for the business. Further there is use of journal articles for the
purpose of reaching to relevant conclusion, findings and recommendations that are to be
developed based on such a analysis of available secondary sources of information.
The present report is based on the theme of “Innovation management it is and why it
matters”.
The report is based on evaluating the below discussed objectives:
 To understand the maintaining of innovation management
 To analyse the importance of Innovation management for organisations.
 To determine the benefits and limitations of open innovation.
Detailed methodology
Methodology is describe as the method that is selected for the purpose of making a detailed
evaluation of the method that has been selected as a part of report to reach to the specific
conclusion based on the pore set objectives.
Primary data: It is a type of data that is collected by the investigator humbled for a specific
purpose. It includes the first hand information that is collected by the researcher and it includes
not any data that has already been collected (Brandl, Kagerer and Reinhart, 2018).
Secondary data: It is a type of data in which there is application of the existing data for the
purpose of making a detailed analysis of the information. In this there is no use of nay type of
first hand information instead focus is done only on the existing information as used by
researcher. Such as there are various sources that includes newspapers, magazines, journal
articles that can be considered as a secondary sources of information in a research work.
In the present report there is evaluation of the secondary sources of information for the
purpose of making a analysis of the laid objectives in the present research work.

Qualitative data: It is the data that is focussing on collecting and analysing of the teual data that
does not includes any type of numerical form of data (Gunduz and Alfar, 2019).
Quantitative data: It is a type of research that is focussed on measurement and further testing of
only numerical form of data.
Qualitative data is generally consist of the softer data points such as visual element or the
available theoretical form of information that has to be further analysed in order to reach to the
relevant justifications throughout the research report.
In preset report there is use of qualitative form of data where there is no consideration
that is given to the numerical form of data.
Literature review:
To understand the concept of innovation management
According to views of Angeal Hengsberger, 2018 Innovation is not the same as it is in the
present scenario. Innovation is associated with Latin word that is “Innovare” that is related to the
economic point something that is bringing the benefit for the society and the organisation. It is
associated with a new innovation and idea that is different from invention. Innovation
management is the systematic promotion of innovation in organisations that consist of tasks of
planning, organisation, management & the last one is controlling (Mergel, 2016). Innovation
management deals with all the efforts that are made by a organisation for the purpose of
generation of higher benefits. It may be in form of development of new product or services to
conquer the market, improvement of new product or services to stand out in high competition. Or
there can be improvement of internal process to strengthen the company internally and then
further saving of cost. Another objectives can be to develop a new business model to generate
some new income sources (LEAD Innovation Blog, 2018).
Innovation management is generally based on two major pillars such as:
 shaping of the overall conditions of framework so that ideas are always created in
companies for implementation of successful innovation. Here the major focus is on
development of organisational activities.
 Another focus is one actual innovation that is taking place with active search,
development & future implementation of ideas that requires higher creativity and the
process of project management.
The filed of innovation management includes:

 Future management in which there is identification of trends & the future opportunists
and risks associated with innovations. There is development of innovation Strategy
according to which innovation activities can be planned such as there is use of a
innovation road map.
 There is further organisation of roles that are part of innovation management that
includes the decision making structures & the overall ownership process (Bouwer,
2017).
 Innovation process is associated with transformational of ideas into successful innovation
so that there is consideration of all the concepts such as concept development, formation
of business plan, development of solutions, prototype and marketing.
 There has to be a culture which is build up and is used for promotion of innovation.
 There is proper portfolio management and innovation control in order to focus on
innovation activities.
 There is innovation networks and open innovation to exploit the external sources of
resources and innovations
 Change management has to be in context with the innovation projects.
To analyse the importance of Innovation management for organisations
Accordance to the views of saren, 2018 Innovation management is a structured process
that helps in capturing of innovative ideas from employees working at different levels in a
organisation that further leads towards Creation of active and building up of a collaborative
workforce. Organisations are generally driven by committee for the ideas that leads to
development of a holistic perspective and provides a one dimensional lockout to deal with the
specific business challenges (Adegbile, Sarpong and Meissner, 2017).
Crowdsourcing innovation is a innovation activity that is making debut in the digital associated
workplace that is leading to meet the high expectation of external society.
It is a practise that leads to active participation of employees in pooling of ideas so that there is
facing of a channel to obtain a effective solution for the complex business challenges.
There is a culture of innovation that is driving the sustainable innovation practises and drives the
productivity of a organisation (Innovation Management: Importance, Ideas, And Examples,
2018).

With the proper incorporation of innovation management another advantage for organisation is
decentralisation where the C level executives can facilitate the process of producing a stronger
innovation Strategy as compared to other higher level executives (Ratten, Ferreira and
Fernandes, 2017).
Pooling innovation can span across a new product innovation and there us enhancement of
overall performance of a organisation with proper cost reduction techniques and the innovative
business methods and models (Goffin and Mitchell, 2016).
To determine the benefits and limitations of open innovation
Innovation management is basically a structured procedure which include developing,
capturing as well as improving the process of company. In addition to this, it consist of proper
organising, processing and monitoring of activities which develop new values for the company
and customer as well (Singh and Gaur, 2018). It is determined that there are various forms of
innovation which can be executed by company that is technological innovation, disruptive
innovation and many more. Innovation is consider as one of the significant part, which help
company to gain higher success and sustain in market for longer time period as well. For
instance, Google was the first organisation to developed business which is based on innovation.
It is stated that company motivate its staff members to give their full potential of their time
which is beneficial for them. Developing a culture of innovation enhance productivity,
performance as well as sustainability of company at marketplace.
It is analysed that to drive innovation in a company & manage, it is important for the
higher authorities of company to allow employees to participate in the decision-making
procedure (Ratten, Ferreira and Fernandes, 2017). It brings out the creativity of employees due to
which an entity is able to develop new and innovative idea that has positive influence on the
performance as well as productivity of the company. The other benefits of innovation is it help in
attaining competitive advantage at marketplace and perform efficiently and effectively.
Benefits and Limitations of Open Innovation
Open innovation is termed as an innovation trend which promotes collaboration with
companies and people prevailing outside the organisation (Trapp, Voigt and Brem, 2018). In
easier terms, it is described as use of knowledge for accelerating internal innovation and tapping
various sources of knowledge and ideas that is both externally and internally. It is stated that the
concept of open innovation is depend on the belief that person outside the company can also

contribute towards the attainment of desired and strategic goals. One of the example of open
innovation is Cisco as it make use of customer driven strategy because of which it is able to
perform in market by efficiently transforming high technological investment into the growth
opportunity. Samsung is also one of the example of open innovation as it is renowned leading
technological organisation globally. It is determined that organisation adopt open innovation at
the time of launching new product and to obtained customer’s feedback in a proper manner.
Benefits
There are various benefits associated with the execution of open innovation by
organisation, which are as follows:
Access Talent – It is consider as one of the major advantage of making use of open
innovation strategy. A company get access to enhance talent as open innovation which act as a
bridge among outside communities or organisation and internal teams. It allow companies to
bring new ideas and solutions that help in making improvements in an effective manner.
Increased competitive advantage – Another major benefit associated with the open
innovation is it assist in offering goods and services which provide value to customers apart of
declining cost in comparison with the rivals (Fontana and Musa, 2017). For example, if an
organisation show making use of new technology to other company then it help in attracting
large number of customers which in turn help in raising customer base level of company and
attainment of competitive edge at marketplace.
Reduced costs, timescales and risks – It is stated that one of the big problem faced by
large companies is occurrence of high cost and raise in time scale of developing a product. On
contrary, small size companies face issue of lack of resources in order to develop product that
they wish too. Herein, open innovation partnership take place and assist in declining cost for
small companies & raise up the creation procedure for big companies. In context to this, risk are
equally shared by both type of companies.
Increased employee engagement – It is determined that staff members of an
organisation lose their interest and motivational levels to perform jobs because of lack of feeling
of ownership of project of which they are part of. It usually arise because of lack of team
members participation as they are not ready and feel comfortable to work with each team
members. By the execution of open innovation, employees get an opportunity to be involved
with in the various aspects of project such as planning, organising, execution and many more.

This as a result encouraged and motivate staff members to put their efforts and retain with the
company for longer time period.
Limitations
Many of the organisation make use of open innovation concept in order to access wide
source of ideas and taken through investing a small amount of money and time as well. In
addition to this, it is mainly done to develop value that might not be able to generate themselves
(Bagno, Salerno and da Silva, 2017). It is significant for an organisation to effectively and
properly plan process of innovation as some of the companies fail to integrate various forms of
innovation project. The limitations associated with open innovation is discussed below:
Diminishing returns – It is stated that finding of ideas and knowledge outside the
company will leads to raise in coordination cost, risk that is both externally and internally. It take
place because of choices that top level authorities develop as there is always an opportunity cost
related with it. In addition to this, regular execution of open innovation declines the overtime
gradually. Therefore, it is said that without an effective planned strategic innovation approach,
there can be increased risk, time and occurrence of unnecessary cost as well.
Operational and structural challenges – Another major limitation is deciding how to
implement it. It is determined that it is difficult because of which it is significant to rethink the
present ways of performing so that open innovation can be applied in an effective and successful
manner (Solaimani, 2019). An ineffective open innovation procedure consist of poor support of
stakeholders, unclear goals, lack of strategy , ineffective communication and so on. It is
important to aligned all the activities associated with open innovation in a proper manner which
is difficult to develop and follow as well.
Finding the right platform for open innovation – Technology plays an important role
at the time of collecting information ideas associated with the place and time as well. It is
determine that sometimes organisations is not sure that open innovation platforms is dedicated or
not dedicated to the external stakeholders (Rhéaume and Gardoni, 2016). Because of which, the
managers find it complex to participate within the idea generation procedure and open
collaboration as well. It as a result effect on the speed and quality due to which business entity is
getting failed to collect & develop ideas.

Critical evaluation
From the above made analysis it can be evaluated that Innovation is also a part of the
improvement that is to implement something new with an optimisation or an extension of
existing situation into a new product or a service with higher creativity. Improvement is a long
process and is not much beneficial for organisations therefore organisations in present scenario
are having focus majorly on improvement of existing product, process to be a a part of
continuous improvement process so that there can be continuous temperament. Innovation
management is covering different aspects for promotion and exploitation of organisational
resources, the goal of innovation management is to improve the new business models with timely
adoption of new process.
In addition to this, it is critically evaluated that open innovation allows a business entity
to enhance its market performance, attain competitive advantage and earn higher profitability as
well. But for this, it is important for companies to select a right and appropriate place where an
open innovation take place as it help in proper execution of activities associated with innovation.
It is determined that innovation developed within the company can be sold as commercial assets
to other business entities which is either survive for long-term or develop as invention within the
marketplace. Moreover, the final result associated with innovation is it help in gaining attention
of large number of people which directly leads to raise in sales as well as profitability level.
Open innovation is significant aspect that if executed can assist in raising performance of the
organisation.

Commercially available solutions:
For the purpose of innovation management there can be use of several commercially
viable solutions that is mentioned below:
 There can be sue of technologies that can lead to enhancement of the innovation process
such as Total quality management which is focussing on the quality of the product or the
process in order to enhance the satisfaction level of customers. The goal of every organisation to achieve higher revenue such as operational
management in this there is opportunity to spontaneously submit the ideas treat it, further
implement it so that the process can be clearly regulated and implemented (Strese, 2016). Continuous improvement process is a tool that mist be used in order to ensure that
employees are timely motived and also highly empowered to constantly questions &
focus on the improvement of process of the team work. Where the major emphasis is to
use the PDCA cycle that is planing, doing, checking and finally activating.
 Kaizen technique can also be used where there has to be continuous improvement in the
organisation. It is a technique that is originated in Japan and is mainly focussed on
enhancement of customer satisfaction by meeting up of all the quality standards that are
laid by the company.
CONCLUSION
From the above discussion, it has been concluded that innovation plays an important role in
an organisation as it assist in attracting large number of customers which leads to attainment of
competitive advantage at marketplace. In addition to this, it help companies to sustain in market
for longer time period in this diverse and complex business environment. Open innovation is one
of the significant aspect which is gaining high importance because of its high benefits to the
companies. It is analysed that it is crucial for business entities to find out the level of risk and
cost associated to bring out innovation so that activities is implemented in a proper manner that
leads to higher growth and success at marketplace.

REFERENCES
Books & Journal
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fundamentals. International Journal of Innovation Management, 22(05), p.1840007.
Brandl, F.J., Kagerer, M. and Reinhart, G., 2018. A Hybrid Innovation Management Framework
for Manufacturing–Enablers for more Agility in Plants. Procedia CIRP, 72, pp.1154-1159.
Gunduz, M. and Alfar, M., 2019. Integration of innovation through analytical hierarchy process
(AHP) in project management and planning.
Mergel, I., 2016. Agile innovation management in government: A research agenda. Government
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Bouwer, L., 2017. Innovation Management Theory Evolution Map. Available at SSRN 3222848.
Adegbile, A., Sarpong, D. and Meissner, D., 2017. Strategic foresight for innovation
management: A review and research agenda. International Journal of Innovation and
Technology Management, 14(04), p.1750019.
Ratten, V., Ferreira, J.J. and Fernandes, C.I., 2017. Innovation management-current trends and
future directions. International Journal of Innovation and Learning, 22(2), pp.135-155.
Goffin, K. and Mitchell, R., 2016. Innovation management: effective strategy and
implementation. Macmillan International Higher Education.
Singh, S.K. and Gaur, S.S., 2018. Entrepreneurship and innovation management in emerging
economies. Management Decision.
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management and its measurement validation. International Journal of Innovation
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Zizlavsky, O., 2016. INNOVATION SCORECARD: CONCEPTUAL FRAMEWORK OF
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