Marketing Innovation Report: Issues in Innovation Management at BMW

This report examines marketing innovation within the context of BMW, a major automobile manufacturer. It identifies three key issues in innovation management: the need for differentiated and integrative innovation concepts, challenges related to firm architecture and external linkages, and the importance of a skilled and creative workforce. The report discusses how BMW can address these issues to enhance its business operations, achieve competitive advantage, and meet market demands. It highlights the significance of adapting to societal changes, fostering knowledge inputs, and promoting scientific and technological developments. The analysis underscores the importance of innovation in marketing strategies, product design, and customer engagement for driving revenue growth and maintaining a strong market position. The report concludes by emphasizing the interconnectedness of these factors in achieving successful business outcomes.

Running head: MARKETING INNOVATION
Marketing Innovation
Name of student
Name of University
Author note

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Table of Contents
Introduction......................................................................................................................................3
Organizational background..............................................................................................................3
Three issues in innovation management..........................................................................................3
Conclusion.......................................................................................................................................5
References........................................................................................................................................7

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Introduction
The marketing innovation means the implementation of new marketing strategies and
techniques through the inclusion of various changes in the designing and packaging of products
and services to attract more customers. The marketing innovation also comprises of placement of
products and promoting those by following new approaches and setting up new prices for
influencing the consumer behavior and generates more revenue in business. The topic will
illustrate about the three major issues in innovation management that can be experienced at
business organizations like BMW and these are important for management of successful business
functioning (bmw.com.au, 2018).
Organizational background
BMW is one of the largest car manufacturers in Australia that has design award winning
cars to serve the middle class people as well as the luxury customer segments. The company was
founded in the year 1916 and presently is has been managed by its CEO named Harald Kruger.
The company has a operating income of €9.665 billion and a revenue of more than €94.163
billion. The types of products are mainly different cars that are suitable for both the middle class
and luxury segment consumers. The nature of the industry is the automobile industry and it has
introduced the best class vehicles that provide both comfort and safety while driving (Sok,
O’Cass & Sok, 2013).

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Figure: BMW Australia (bmw.com.au, 2018)
Three issues in innovation management
The innovation process should be managed by selecting creative individuals at first, then
develop knowledge and skills through management of operating functions and activities and
lastly, improving the company’s architecture and create external links to adapt to the societal
changes. This would also help in meeting the demands and preferences of the market as well as
promote knowledge inputs to facilitate the scientific and technological developments at BMW
with much convenience (Rozdolskaya, Ledovskaya & Afanasiev, 2013).
One of the major issues in innovation management, which is important and need to be
considered by BMW is the differentiated and integrative innovation concept. Often the
automobile industry wants to manage sustainable innovation, which is not possible by one-sided
approaches. It is important to conduct individual assessment and the differentiated approaches

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for enhancing the innovation capabilities and improve the business performance, furthermore
keep the objectives inclined with the needs and requirements of the customers in various market
segments. Due to one-sided approach, the innovation skills might hinder and thus create failure
in adapting to the changes within the industry. One of the major challenges faced due to this
could be to gain ambidexterity for managing separation and integration at the same time, which
might even interfere with the core business practices (Ceylan, 2013). Due to this, the company
might fail to adapt to the changing needs in the market and develop knowledge to promote
innovation of products and services successfully.
Figure: Methods followed during innovation (Ceylan, 2013)
Another major issue in innovation management could be related to the firm’s architecture
and external linkages. This could often create difficulties in responding to the societal changes
and fulfill the demands and opportunities of the market properly. Due to this, the business
models are developed in lesser numbers and radical innovation effectiveness are deteriorated.

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Due to the inappropriate firm’s architecture, the systematic approaches to business model
innovation will not be established properly, which can further not keep the processes for product
innovation in place. To deal with this kind of problem, the company has promoted the benefits of
the vehicles such as compulsory fitting of Takata airbags in every vehicles to ensure that the
level of safety and convenience is increased for the driver and passengers (Ersun & Karabulut,
2013). The virtual innovation agency has been formed to develop paths for innovative solution
and this made created good reputation and even named BMW as one of the premium automobile
manufacturers in Australia too.
Figure: The new BMW i8 (Ersun & Karabulut, 2013)

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Figure: Sustainable innovation at BMW (Bartoloni & Baussola, 2016)
Another issue for innovation management could be the lack of skilled, creative and
knowledgeable workers who should be responsible for the scientific and technological
developments. With the involvement of creative individuals, it would be easy to create
knowledge inputs as well as bring technical innovation excellence to suit the needs of people in
different market segments (Bartoloni & Baussola, 2016). The creative workers would be able to
follow the systematic approaches to business model innovation and at the same time, facilitate
the innovation process through scientific and emergent approaches. The knowledge kevel would
also be improved, which could further create ease in developing a culture of experimentation,
where innovation should be evitable at BMW (bmw.com.au, 2018). With the knowledge inputs,

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the innovation process would tend to be easier to be managed, furthermore could lead to efficient
business operations, processes, and bringing more profit in business.
Figure: Innovation process overview (bmw.com.au, 2018)
Conclusion
The report was prepared to discuss the concepts of marketing innovation considering the
business organization BMW in Australia. Based on the large size and wider base of customers,
there could be various issues such as lack of creative workforce, management of operating
functions through development of knowledge and innovation processes along with the external
linkages and firm’s architecture. All these issues in innovation management were considered to
ensure that the firm could manage its business operations properly, based on which, high level of
profit would be generated and would also make BMW attain competitive advantage in business.

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References
Bartoloni, E., & Baussola, M. (2016). Does technological innovation undertaken alone have a
real pivotal role? Product and marketing innovation in manufacturing firms. Economics
of Innovation and New Technology, 25(2), 91-113.
bmw.com.au. (2018). Bmw.com.au. Retrieved 18 March 2018, from https://www.bmw.com.au/
Ceylan, C. (2013). Commitment-based HR practices, different types of innovation activities and
firm innovation performance. The International Journal of Human Resource
Management, 24(1), 208-226.
Ersun, A. N., & Karabulut, A. T. (2013). Innovation management and marketing in global
enterprises. International Journal of Business and Management, 8(20), 76.
Rozdolskaya, I., Ledovskaya, M., & Afanasiev, I. (2013). Innovation consulting services within
the context of the formation of a new model of marketing innovation. World Applied
Sciences Journal, 25(6), 956-960.
Sok, P., O’Cass, A., & Sok, K. M. (2013). Achieving superior SME performance: Overarching
role of marketing, innovation, and learning capabilities. Australasian Marketing Journal
(AMJ), 21(3), 161-167.