Innovation and Frugal Innovation Strategies: A Tesco Case Study Report

This report provides a comprehensive analysis of innovation strategies employed by Tesco, a leading British supermarket. It begins by defining innovation and its importance to organizations, contrasting it with invention. The report explores how organizational vision, culture, and teamwork shape innovation and commercialization within Tesco. It delves into the 4Ps of innovation (Paradigm, Product, Process, Position) and their application. Furthermore, it examines the innovation funnel and its role in shaping innovative ideas. The report concludes with an overview of frugal innovation, illustrating its relevance through examples like Deliveroo and Samsung's smartphone strategies. The report uses Tesco as a case study to illustrate concepts and highlight practical applications of innovation management.

INNOVATION

INTRODUCTION
The term innovation is referred to as process in generating fresh and modern ideas into
business that act as a beneficial for a particular firm (Chand and et.al., 2018). It involves use of
new technology, ideas and suggestions so it is must and more beneficial for a company (Schöggl,
Baumgartner and Hofer, 2017). Thus, this study adopts Tesco. It is a British leading supermarket
in UK.
In the below report, importance of innovation has been described. Organizational vision
and culture helps in shaping innovation has also been explained. Furthermore, comparison
between innovation and invention has also been done. Thus, 4Ps of innovation along with its use
in developing frugal innovation will be determined in this report. In addition to this, this report
also highlights on different tools that is being used by the organization in order to create,
continue and assist knowledge as well as intellectual property has been described.
LO 1
P1. Explain innovation and determine its importance to organisations in comparison with
invention.
The term innovation is defined as the process of translating idea into finished goods and
services for which value has been created and customers pay for it later (Sudarić, Zmaić and
John, 2017). It is the application of improved answer that meet the requirements and needs of an
existing market (Desmet, 2018). It is also known as to improve the existing product or services.
Hence, invention is defined as to create a product for a first time that has never been
made before.
Innovation is defined as action or process to innovate old ideas into new ones. It is also known as
new idea, method or product.
Importance of innovation
Innovation of a particular business is very much important in order to achieve high term
profits or margins, diversification of a product, product differentiation and satisfying needs of the
customers (Tukker and Tischner eds., 2017). Thus, it is also important in terms of advancement
of a society. Products that are innovated provides opportunities for the people to improve their
life (Differences between Innovation and invention, 2018).
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People innovate ideas when they think that old idea has been outdated or not giving maximum
profit as compared to before.
Invention is uniqueness, method or process within overall engineering and product
development process.
Comparison between innovation and invention in terms of Tesco.
BASES OF COMPARISON INNOVATION INVENTION
1. Meaning It is defined as occurrence
when someone improves or
makes important contribution
on the product, process or
service that is already existing
in market.
It is defined as creation of a
new product on introducing
process for first time.
2. Process Innovation is an easy process
than invention.
It consists of genius process.
3. Step Innovation is the presenting
the existing products with
different ideas and process.
Invention is the first step to
bring out a product.
4. Handed to The product that is invented is
further handed over to
innovation for improving the
existed product or services.
The invention is creating
completely new and hand over
to innovation.
5. Requirement of skills The skills required to
improvise something are
technical as well as marketing.
Invention mainly requires
technical skills in order to
bring ideas to life.
6. Born from Innovation has been born from
constant need in order to make
things better and earn high
competitive advantage in terms
of existing product and
It has been born from an idea
that is got by inventor in order
to produce something.
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invention.
7. In charge There is not a particular in-
charge that can pitch in. it
usually needs technicians and
designers that helps in
improving product constantly.
R&D departments are in-
charge that comes up with new
and innovative inventions.
8. Dependency Innovation depends on
invention. It is impossible to
innovate products without
invention.
It does not depend on anything.
It is the first step in producing
product and services.
P2. Explains the company culture and team work in order to shape innovation and
commercialisation.
The main purpose of innovation is to box new ideas and invention helps in actualising
this innovation and decoding of new thinking (Vanhaverbeke, 2017). Thus, main motive of
innovation and invention both is to commercialise the products and services that are produced by
Tesco. Commercialisation plays a role of collection to all innovation and invention, marketing
and act to customers (Galli and et.al., 2017).
The term commercialisation is defined as the course to manage or run something in
principal manner to achieve financial gain.
Thus, to commercialise product into market, different factors affect the process of
innovation and commercialisation. Organisational culture is none other than encompassing all
areas that determines future objectives and goals of Tesco.
The main vision of Tesco is to provide best and fast service to their potential customers
for which they will have to innovate new and unique ideas about products and services offered
by them and commercialise products into market that has been innovated by way of entering into
market with that innovated product. Thus, vision plays very important role in inventing and
innovating process of a particular company.
Further, leadership is a method that is performed by Tesco in order to achieve goals and
objectives that later leads in becoming success. There are different methods that are being used
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in leadership that includes autocratic, democratic, participative and laissez faire (Vermeir and
et.al., 2018). Autocratic act as the best method for Tesco, as it said that leaders available in
organisation are aggressive in order to obtain the required qualities. Therefore, this leadership
method will help in making Tesco to reach the boost.
The culture of the Tesco includes values, norms and attitudes of employees that work in cited
company from many years. It is the process of doing various things in an organisation. Thus,
cultural difference has great impact on innovation and commercialisation process of goods and
services.
Team is the dynamic process that helps in achieving targeted objectives and goals and
completing special task according to the planning that has been set up by Tesco. Thus, the cited
company has team in order to perform specific job for innovating and commercialising products
and services into market. They also help in formulating process of innovation and
commercialisation of Tesco.
Factors that affect innovation and commercialization
There are many factors that affect innovation and commercialization such as government,
society, legal factors. All these factors affect the company strategies and growth in order to
perform the task. Innovation is generally form a new process of thinking by exploiting the bundle
of knowledge. Due to insufficient knowledge or scope company fails to innovate new product or
services.
LO 2
P3. Explaining 4ps of innovation and explaining use of innovation funnel to examine and shape
innovative ideas.
Innovation is deals with procedure by which Tesco creates fresh thinking and ideas, new
products and services (Yun, 2017). Thus, 4ps of innovation is the innovation mix that has been
used by Tesco are discussed as per below context-
 Paradigm- it is termed as planned process through which Tesco faces changes of being
taken innovative ideas and process of thinking about doing all jobs by selected
organisation in terms of facing new challenges and threats. The cited company Tesco has
to plan about doing business in the situation and condition that changes. Thus, to provide
new and innovative products to the customers, the company has to face fake calls and
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time service. This P of innovation can build or shape the new innovation product or
services for the company development.
 Product- Product plays an important role in increasing its evaluability to the cited
company by offering it to the potential customers. Thus, if company launches new
product and services in market than it will be able to add maximum value to organisation
with help of adding competitive advantage. Thus, it is the main and important item of
Innovation mix through which the process of innovation and commercialisation is done.
 Process- Process is termed as the way through which product is provided to customers.
Thus, it is termed as an important issue, because of the process that takes longer time in
order to deliver products and services decreases the prospect of prosperity and if transfer
procedure is short it increases chance of success. Position- Position is that which Tesco wants to achieve with help of innovation and
commercialisation process. It is termed as targeted goal in context of the quoted
enterprise. Thus, this company wants to achieve this position by providing the best goods
and perfect services to the potential customers of Tesco.
INNOVATION FUNNEL
It is termed as a process in order to develop new ideas by describing various steps that
makes ideas the best and also that provides better products and services to customers (Homburg
and et.al., 2017). There are various types of ideas and thinking and also different types of funnel
by which ideas can be motivated or possessed. It also helps in maximising the goals and
objectives. The first and important step of innovation funnel is to collect information and deals in
analysing about the uniqueness of the idea that fits in customers’ needs and wants. Later the
process comes into screening the best ideas among all that has been analysed for the
implementation process. In addition to this, the best idea that supports the consequences and
opportunities comes into mind. Later, Tesco implement the idea into action that has been decided
by them in order to achieve long term success.
In other words, innovation funnel is the process of inventing new process or task to
reinvent the things into more effective manner. This funnel process helps to define the new
product or services produced by the company. For example : in order to innovate new product by
Tesco which starts from the process of funnel such as idea, define developed tested and
implemented.
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Thus, with help of 4ps that has been discussed above it has been analysed that tesco has
to follow these procedures to achieve long term growth and success.
P4. Explaining developments in frugal innovation.
Frugal innovation acts as a process that helps in inventing ideas related to products and
services in context of scarce resources of a particular country (Kalish and et.al., 2018). it also
depends on various other factors of a particular country that includes political, environmental and
social that acts as a driving force in terms of frugal innovation. The above-mentioned factors
play very important role in order to help in shaping the process of innovation. It also helps in
reducing expenses of products that are produced in dramatically low level. Thus, it also helps in
supplying the value for particular products and services by moving to level that is lower to the
purchaser and acts as a cost reducing activity of a particular products and services offered by
Tesco.
examples of frugal innovation include following
For example, if Deliveroo adopts frugal innovation process they have to consider various factors
in important or critical way.
Samsung renowned the produce of brands different smart phones for the customers of India and
UK. This comes under the process of frugal innovation. As because the customers of this
respected countries are different in their taste, preferences, demand and choices. The people of
UK are highly sophisticated and knowledgeable so the Samsung company planned in order to
launch its product of smart phones in UK, by featuring new and complex functions and the
customers try to expense more than the people of India.
Thus, frugal innovation is best for doing in country having poor people, where products
should be produced with inferior complex functions and that are easily reachable for using the
phones (Kong and Ko, 2018).
LO 3
P5. Analyse importance of commercial and application of NPD
The term commercial funnel is defined as the process of buying that company lead to
customers while purchasing products. It is also known as business process stage or stakeholder
stage (Li, Li and Lin, 2018).
Importance of commercial funnel
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It is one of the hey highlights and its importance for business of any industry or business
size. It plays significant role in building healthy relationships of business and also helps in
engaging with people that later helps in generating inquires, qualified leads, opportunities,
revenue etc. other importance includes following context-
 keep focus on inquires
 Helps in reviewing revenue in order to see where adjustments can be made on pricing
that helps in producing goods and services.
 Helps in nurturing leads that are qualified.
 Helps in reviewing new business opportunities.
 Helps in projecting reasonable goals and also obtaining them for internal and external
sales team.
Thus, it becomes essential for any type of business to bring potential customers into fold on a
consistent basis that can be later marketed and promoted products and services reduced overtime.
Application of New product development
New product development is a process that helps in bringing new product in market.
Thus, business needs to engage in this process due to alteration in the preferences of consumers,
increasing rivalry and advances in technology or capitalise new opportunity.
Entrepreneur of Tesco knows that productivity acts as a single key for successfully
developing the product (Li and Yang, 2018). The stages that are included in new product
development are as follows-
 Generating- by utilizing internal and external analysis of business environment and also
analysing current trends of market, Tesco must generate ideas regarding developing the
best and perfect product that meet the needs and trends of the market. This is the key and
important stage for Tesco as it requires innovative and creative ideas to develop a
particular product.
 Screening the idea- for this step, the cited company has to set specific criteria for ideas
about which is to be continued and which is to be dropped.
 Testing the concept- this is the step that comes after screening the idea and after test
marketing. Thus, beside this, all ideas are passed and testing is being done that helps in
analysing whether new product is helpful or not in Tesco.
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 Business strategy analysis- thus, Tesco has to analyse the strategy of business that helps
in deciding different methods in order to promote new product into the suitable market.
 Product development- thus, product has been developed in this particular stage where
concept of producing product is really changed into real products.
 Test marketing- later, model is introduced in market that helps in testing and taking
feedback for further modifications and uniqueness.
 Commercialisation- in this stage, the product is actually ready and thus, final decision has
been taken to introduce that new product into the market (Li and Lin, 2018).
 Introducing- the last stage is to introduce new product by promoting it new market.
P6. Building an Innovation business case including ways to access funding.
Business case is termed as a systematic approach that involves the process of various
steps (Nguyen, 2018). Thus, it also helps in building or expanding business into next level where
success lies. It is the significant and advanced technique that has been actually provided to all
stakeholders of Tesco.
Ip tools are that powerful network toolkit that speeds up and sets up networks . It also
allows quick detection any computer network problems, ip address detection and encouraging
network performance. This is a must-have app for IT particular and web administrators.
An important information that has clear process and is also transparent. This case includes
following concept-
 It offers tools of different creativity that helps in starting new business process.
 It also helps in providing different suggestion as well as guidelines that helps in making
case strong and effective.
 The other step that is included is preparation of a case and cost benefit analysis where the
employees of Tesco clarifies their doubts or misunderstandings.
 Next step that is included is developing new marketing strategy that outlines tactical
moves that is absolutely different.
 Last step is to check full information and USP also required to be translated case into
winning of technical chance.
Ways of access funding
the ways that are included in and methods are discussed as per below context-
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 Bootstrapping- this means that Tesco uses own personal saving that has been saved for
personal buying. This is the most simple and fast method from where they can receive
amounts or fund (Reckwitz, 2018).
 Friend or family- this is the second most easy method from where Tesco can generate
fund through family and friends. They can also invite their family and friends to invest
some amount for expansion of a cited company.
 Crowdfunding- this process or method provides small amount of money for a particular
company. Thus, people from different range are included in this methods through
internet. This method is considered as the most common way of accessing fund for
company.
LO 4
P7. Evaluating different tools that can be used to develop, retain and protect knowledge and
intellectual property.
The term intellectual property is referred to as a category of property that includes
basically copyright, patents and trademarks. This type of intellectual property helps in
encouraging creation of a very large variety of goods that are intellectual (Reiter-Palmon ed.,
2017). In order to achieve this, the law of a particular country helps in providing different
legislation for company and this are discussed as per below context-
 Patents- this right is granted for inventing a product and is provided to those who are
innovating their products and also helps by offering technical solution to the problem.
Patent also helps on proving the owner the right in order to eliminate else from devising,
using, and also selling a particular product. If Tesco company will have this right than
their company along with logo and products will be protected from unnecessary deeds. In
addition to this, in various countries rights of patents fall under civil law and the holder
has to take action if any other person bounds it. This law of patent plays an important role
in many companies as it helps in gaining competitive advantage.
 Copyrights- this protects the literacy and musical work. The primary and important use of
this copyright is to defend the Boucher of institution, yearly document and many other
documents. Thus, it is also necessary for Tesco to utilise it as an intellectual property that
will aid them in protecting brochure of a particular company and many other result that
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are unnecessary. If any person uses this document then it is against law if they use them
in making personal benefits and they will be liable for any misshapen.
 Trademarks- it is the most ordinary law that is used by company that also helps in
protecting words, names, symbols and devices that is further used in connection with
goods and services that helps in identifying their source. Thus, by this law, the selected
company can protect their brand reputation and image of the logo from any type of
mischiefs. Furthermore, if the Tesco uses this trademark to protect their logo, labelling
and also makes them different from other competitors. This will be helpful for them in
order to use this type of law in their working area.
CONCLUSION
Thus, from the above report, it has been concluded that innovation and commercialisation
play important role in Tesco because they want to introduce new products in the market so that
they can easily expand and diversify their products. Further, the innovation and invention has
been compared and also states vision, culture, leadership and teamwork that helps in shaping up
innovation. It has also been concluded that with help of using 4ps the company can easily
innovate and expand their business by using creative ideas. In addition to this, this report also
evaluates different intellectual property tools that includes trademarks, copyrights and patents
that can be used by Tesco.
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