Innovation and Commercialization: A Rolls Royce Case Study

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Innovation and commercialisation

TABLE OF CONTENTS
Introduction......................................................................................................................................1
Main body........................................................................................................................................2
Explain innovation and determine its importance to organizations in comparison with
invention......................................................................................................................................2
Explain how organizational vision, leadership, culture and team work can shape innovation
and commercialization.................................................................................................................3
Also, critically analyze different sources of innovation and how innovation is developed,
embedded, and measured in an organizational environment.......................................................5
Explain the 4Ps of innovation and explain the use of innovation funnel to examine and shape
innovation ideas...........................................................................................................................7
Explain the development in frugal innovation and provide examples of how it is used in an
organizational context..................................................................................................................9
Analyze and apply the innovation funnel in an organizational context.....................................10
Provide an evaluation of the role of frugal innovation using an organizational example.........10
Presentation task............................................................................................................................11
Importance of the commercial funnel and the application of new product development..........12
Innovation case, ways of accessing funding and how to measure its overall effectiveness using
appropriate techniques available to test and improve................................................................14
Different tools that organizations can use to develop, retain and protect knowledge and
intellectual property...................................................................................................................15
Evidence-based evaluation of these different tools in the context of wider business
environment...............................................................................................................................16
Nature of innovation and the context in which it is developed.................................................17
Conclusion.....................................................................................................................................19
References......................................................................................................................................20

Introduction
Adopting changes as per the current trend and customer requirement will help the organisation to
enhance its range of products and services. Rolls Royce car is the international automobile
industry, and they manufacture luxury cars for their customers. The report will discuss new
product development for Rolls Royce car through which they can implement some innovative
idea to meet their customer needs and expectations. The report will create an innovative idea that
will help the Rolls Royce car to improve their car range and through that, they can achieve
competitive benefits. The report will also discuss the difference between innovation and
invention along with the sources of innovation. Further, the report will also discuss 4Ps of
innovation through which organisation can provide appropriate shape to their innovative idea.
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Main body
Explain innovation and determine its importance to organizations in comparison with invention
Introduction to innovation
The term innovation is defined as the new ideas or any kind of creative thoughts in the form of
the method of the device. The innovation ideas will be adopted by the organisation when they
realised that their current concept or ideas are quite outdated and now it is essential for them to
enhance their product range by using innovation idea (Jensen et al, 2016). This is a kind of
solution which will support organisations to meet market requirement, customer expectations and
high product sales.
Following are some points that clarify that innovation is important for Rolls Royce car:
Innovation resolve sales problem: Innovation generates the new thoughts and ideas for an
organisation that are facing sales reduction problem because improvisation in the existing
product or innovation of new product will grab the high attention of customers. In the case of
Rolls Royce organisation, they are manufacturing only high ranged and luxury cars which are
operated through petrol due to which their sales are reducing in the last year. So, by adding new
product in their list will help them to continue with their high goodwill and sales. For example,
Rolls Royce can go for battery operated car which can be operated through powerful batteries
and customers can easily use the cars.
Innovation enhances business productivity: Innovation not only increased the sales for business
but also enhance the production level of the business. With the implementation of new ideas in
the current product line will help the organisation to increase its productivity. Rolls Royce
organisation can use the innovation concept for launching battery operated cars in the market due
to which efforts of their employees will increase, and those results in high productivity and
profitability (Tidd and Bessant, 2018). For example, focus on new product development by Rolls
Royce will improve their workflow, which will directly increase the car manufacturing and sales
productivity.
Innovation v/s invention
The concept behind these two terms is very different, and that is why both are used for different
purpose and requirement. Innovation concept will be used by the organisation when they want to
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add some new elements or range of products on their existing product line, but invention means
completing a new product or concept in the market (Witell et al, 2016). For example, Rolls
Royce organisation is the car manufacturer, and if they bring new battery operated cars in the
market, then this idea will be covered under innovation. But, the invention of the thing is the
product that currently not exists in the market for example- manufacturing of robot for the
operation of cars.
Explain how organizational vision, leadership, culture and team work can shape innovation and
commercialization
Innovation is not only based on the generation of new ideas but is also related to relate to
implementing it effectively by providing proper shape to the idea. Generation of innovative ideas
and its implementation require proper vision, support of leadership skills, positive working
culture and teamwork spirit. These four key factors support the organisation and its innovation
team to execute their innovation idea in reality as per their expectation. The role of vision setting,
leadership support, working culture and team collaboration is significant to provide shape to the
idea that is proposed by the team of Rolls Royce organisation.
Organisation vision: Clear vision of organisation helps the innovation project team to
understand the main requirement of the organisation related to the new product and new services.
In the case of Rolls Royce organisation, their vision is clear that they want to jump into a new
segment of cars to target new customers and to increase their sales in that segment also.
According to that vision, innovation project management team decided to bring battery operated
cars in the market on a reasonable rate (Breuer and Lüdeke-Freund, 2017). This clear vision
helps the team to launch the new product with high quality and attract new customers.
Positive working culture: Culture of an organisation influences the workflow and productivity
which sometimes create positive impact or sometimes negative on the innovation project. If
understanding between innovation team is not good then selection of the best idea mutually is
not possible. But, if the internal culture of the Rolls Royce is positive, then the best decision will
be made in favour of the business. With the proper communication and high commitment of
employees, this will be possible for the team to provide proper shape to their new innovation.
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Leadership skill: Leaders of organisation play a vital role in shaping the innovation because
only because of their proper support, direction and guidance, the project will be completed
effectively. Soft skills use by leaders will encourage the team to execute this innovation for the
benefits of Rolls Royce (Caridi‐Zahavi et al, 2016). Quality of leadership skills creates a better
understanding among the team and this project which help them to hire new technical employees
or provide training to existing employees for manufacturing battery operated cars.
Team performance: Teamwork and collaboration working is the essential factor which will
provide effective shape to the innovation ideas. Working in one team will improve the time
management strategy because roles are equally distributed for executing this innovation plan in
the Rolls Royce context. The chances of risk and uncertain activities are also low is the team will
work together under this project. Teamwork also reduces the chances of internal conflicts which
may hinder the innovation plan as team spirit enhances the commitment and motivation level of
the employees.
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Also, critically analyze different sources of innovation and how innovation is developed,
embedded, and measured in an organizational environment
Innovation sources provide the opportunities to Rolls Royce for developing, embedding and
measuring the innovation process. Peter F. Drucker explained the seven sources of innovation
that will help the Rolls Royce organisation to- plan, embed or monitor the whole activity of
product innovation. According to Peter F. Drucker necessity and power of the systematic
innovation are inspired by these innovation sources such as- the unexpected, Incongruities,
process require, change in market structure and industry, Demographics, perception change and
new knowledge (Coccia, 2017). There are only three sources which inspired the Rolls Royce
organisation towards innovation idea.
The unexpected innovation source covers failure and success of the business which will inspire
the organisation to adopt innovation idea. In Rolls Royce case they are leading brand in car
manufacturing business but due to their luxury car range they are not able to target lower level of
customers so they adopted innovation idea.
Incongruities source shows the complaints, feedbacks and suggestions of the customers to Rolls
Royce due to which they realised that now it’s time to move towards battery operated cars. This
determination inspired the team of Rolls Royce to analyse what they are providing and what they
now supposed to delivery in the market (Fitzgerald and Karanassios, 2017).
Demographics source is considered under the change of the customer’s needs, expectations,
income level and lifestyle due to which demand of the existing product may get decreased. The
change in the demographics also inspired the Rolls Royce team to now target new segment of
customers who can easily afford battery operated cars.
How innovation is developed, embedded, and measured by Rolls Royce team
Innovation in the context of Rolls Royce organisation can be developed by implementing some
stages of innovation process such as- idea generation, idea screening, scoping all the ideas,
second screening, create business case, develop the method, test the decision, select one idea and
develop the product for market launch. After conducting all these process by the team of Rolls
Royce the final innovation idea of battery operated cars is selected (Clauss, 2017). Innovation
executed by Rolls Royce organisation can be measured by analysing the ratio of the revenue
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from their new idea (battery operated cars) and divide it with the average cost of the idea
implementation. Aggregate Return on Investment (ROI) of this new idea will help the
organisation to measure the innovation.
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Explain the 4Ps of innovation and explain the use of innovation funnel to examine and shape
innovation ideas
Product, process, position and paradigm are the 4Ps of the innovation that Rolls Royce needs to
implement for effectively executing their innovation idea. These 4Ps also help the organisation to
understand the existing position of the brand and how they can enhance their position by
implementing the innovation plan.
Product innovation
Mainly product innovation is related to what kind of product and services organisation is offering
to their customers and how they can attract customers for increasing their sales. Product
innovation for Rolls Royce organisation is related to bring new product in the market. As per this
factor, the organisation decided to bring a battery-operated car in the market for attracting
another segment of customers (Alsanad and Abdel-Razek, 2016).
Process innovation
This factor covers strategies and changes that service or product are created and delivered, and
this is an essential factor for an organisation to provide proper shape and structure to the
innovation. The process of innovation must be as per customer’s expectation. To implement the
process innovation, the HR department needs to conduct the recruitment and selection process to
bring this new product in the market. The marketing department also needs to conduct a
promotion process for attracting customers.
Position innovation
After conducting a proper innovation process, the next step is related to create a brand position in
the market by enhancing the sales of the new product (battery operated cars). By conducting
digital marketing and online booking of the cars will also help Rolls Royce organisation to
influence their customer's selection and through which they can achieve highly competitive
benefits (Trantopoulos et al, 2017).
Paradigm innovation
The process mainly helps Rolls Royce organisation for representing the changes in the
customer's preferences, taste and behaviour. Battery operated cars can be produced by the
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organisation on lower prices as compare to the other competitive cars so that different segment
of customers can buy cars on affordable prices.
Introduction to innovation funnel and how it helps to provide proper shape to innovation
The term innovation funnel is related to the mechanism which enables the constant ideas
streaming that are screened by the team for viability. This is one of the effective processes which
will help Rolls Royce organisation for providing proper shape to the innovation process by
creating an action plan (Anzola-Román et al, 2019). With the help of the innovation funnel
process, the innovation project team of Rolls Royce can create a well-structured action plan in
which all the activities related to project along with the deadline must be mention. This action
plan will help the team to execute the innovation plan in an effective manner.
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Explain the development in frugal innovation and provide examples of how it is used in an
organizational context
Introduction to frugal innovation
This is considered as the process through which organisation can reduce the complexity in their
product sales and product cost along with its production. Mainly frugal innovation define for
removing some of the nonessential features from their existing product and services like- phone
or car in respect of selling it in the developing countries.
Development in frugal innovation
Development of the organisation through frugal innovation will help the Rolls Royce
organisation to launch their new car in the market by using some limited resources. The main
benefit that an organisation can achieve from frugal innovation is the reduction of the risk that is
associated with the business and which create a negative impact on the use of resources and
decision making (Rosca et al, 2017).
Rolls Royce organisation can use frugal innovation process by considering the following
stages:
Phase 1 (focus on key issues)
Under the first phase, the team of the organisation need to analyse the key problem they are
facing that reduces car sales and customers interest. According to this, the team analysed that the
key issue is related to their one range of cars such as- luxury due to which only high class of
customers get attracted. They are only producing luxury cars on high prices which reduced their
customer base and decreases sales.
Phase 2 (analyse the way to resolve it)
According to the analysed problem, the best solution for them is related to focus on a new
segment of customers such as- middle and lower class of customers (Trantopoulos et al, 2017).
Battery operated cars can be manufactured on low cost as compare to the luxury cars so Rolls
Royce can launch battery operated cars on affordable prices for attracting new customers.
Phase 3 (implement frugal innovation)
By implementing changes in the existing cars as per their market research the organisation can
grab customer’s attention and also achieve high competitive benefits as compare to their
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