Xerofone: Analysis of Innovation Strategy and Business Model

This report provides a comprehensive analysis of the Xerofone startup, a pre-revenue cross-platform application aiming to launch in the UK and Ireland. It examines the business landscape of the software application industry, including market size, growth, and competition. The report compares Xerofone to competitors based on features and benefits. It delves into Xerofone's current innovation strategy, classifying it as incremental and focusing on product innovation. The report also analyzes Xerofone's current business model using a business model canvas, highlighting key partnerships, activities, value propositions, customer segments, relationships, channels, resources, and revenue streams. Strong and weak points of the model are discussed. Furthermore, the report explores business model innovation, benefits, and challenges, culminating in specific recommendations for Xerofone, such as articulating value propositions, adopting a B2B2C model, and implementing a price penetration strategy. The conclusion emphasizes the importance of innovation and entrepreneurship for business success.

Innovation and
Entrepreneurship

Contents
• INTRODUCTION
• BUSINESS LANDSCAPE
• CURRENT INNOVATION STRATEGY
• CURRENT BUSINESS MODEL
• BUSINESS MODEL INNOVATION
• RECOMMENDATIONS
• CONCLUSION
• REFERENCES

INTRODUCTION
Innovation is a concept of introducing a unique idea and then converting that idea
into an economic activity. This concept of innovation involves generating ideas
which can serve and facilitate people.
The start up case study which is selected for this report is Xerofone. It is a start up
which is currently in pre revenue position and is planning to launch their cross
platform application in UK and Ireland.
This project includes business landscape of a start up which includes analysis of its
current innovation strategy and business model so that valid recommendations can be
made against the pricing strategy, post sales support and target segments.

BUSINESS LANDSCAPE
• Total revenue which this industry
has aerated in the year of 2019 is
increased to 31 billion pounds.
• The reason behind the enhanced
revenue is the increased number of
businesses engaged in this industry.
Total number of businesses
operating in software application
industry are 35,127.

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• This industry has attained in the annual
growth of average 9.4%. This growth is
accounted or the years 2014 to 2019.
• By these constraints of high revenue
generation and huge number of businesses
operating in this industry, the industry
employment has also increased. The total
number of employees which are currently
working in this industry of UK are 196615.

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A comparison between Xerofone and its competitors on the basis of
their features and benefits is developed below:
Basis Xerofone Screentime Ourpact iKydz Kidslox
Data accessibility Xerofone does not allow schools,
parents and organisation to access the
data of their students, children and
employees as they believe that it
breaches the privacy. The software
application of Xerofone only enables
to disable smartphone function but
does not enable the data accessibility.
Unlike Xerofone, it
allows its users to
access data of their
controlled devices due
to which it is only
suitable for parents.
Allows data
accessibility.
Allows data
accessibility.
Allows data
accessibility.
3G/4G version Xerofone is a software application
which has its 3G and 4G versions.
This application only
works via Wi-Fi
There is no 3G version
available of this
application.
iKydz only works with
network of WiFi which
means as soon as
children is out of the
range of their home
WiFi, they can use any
application using a 3G
network.
There is no 3G version
available of this
application.
Price £4.29 £2.99 $6.99 £15.00 $3.99

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Opportunities
United Kingdom is a developed country due to which the level of
education in this geographical area is high. Xerofone is a software
development organisation and it is important for such organisation to hire
skilled employees who has the knowledge of information technology.
Threats
Due to increasing demand of software application, the number of
businesses has been increased in this industry which is a threat of
Xerofone as the number of their competitors is continuously increasing.

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Sector trends are the trends which affects the functioning of the businesses
operating in that sector. As Xerofone is operating in software development
sector, all its opportunities and threats affects functioning of Xerofone.
Currently Xerofone is targeting school administration and organisations from
which they deal B2B.
Social/consumer behaviour trends are the prevailing activities and preferences
of consumer which they perform repeatedly. In the industry of software
development, a consumer trend which is observed is that consumers whether
individual or enterprise prefers to use free applications so that they can first
trust the software and then can pay according to the worth of that application.

CURRENT INNOVATION
STRATEGY
Innovation strategy is the plan which an organisation develops for their
products and services. Usually an innovation strategy is of two types
which are incremental and radical. Incremental innovation strategy
allows an organisation to innovate existing products of the market
which involves low risk and high certainty of competitiveness. On
the other hand, radical innovation strategy allows an organisation to
innovate not only the product but the whole market. The risk factor
in this innovation strategy is high as the organisation intend to
launch a product or service which does not even have a market.

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Innovation can be classified into three classes which are product innovation,
process innovation and business model innovation. In the case of product
innovation, an organisation develops and launches a new product which
has features that are unique in its nature and no other organisation in
market yet is offering that product with same features. It must be noted
that product innovation does not mean launching an entire new product
but launching a product with few unique features by innovating it on the
surface. On the other hand, process innovation is a procedure of bringing
new techniques of producing a product by which quality, appearance or
suitability of the product enhances.

CURRENT BUSINESS MODEL
Description of the organisations business model
Business model is a plan by which an organisation intends to make profit.
The business model is a complete plan for future in which organisation
strategize their organisational structure, revenue streams, expenditures,
employment plans and others. A business model is usually developed at
the time of pre establishment of an organisation. Or it is also developed
at the time of business reborn. A new organisation develops a business
model in order to attract investments so that they can operate effectively.
The main aim behind developing a business model is to identifying
revenue streams and establishing details of financing.

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Business model canvas
Key Partners:
Our suppliers are
domain supplier
and webpage
supplier.
We are acquiring a
domain name from
our supplier.
Our key partners
perform activity of
arranging suitable
domain name for
our business.
Key Activities:
Our value propositions require effectively
software development and regular
application development to remove bugs.
Our revenue streams are the fee charged by
corporate organisations.
Our customer relationships are with human
resource management organisations.
Value Proposition:
We deliver the value of
productivity and employee
focus to our corporate
customers.
We are helping our corporate
clients in resolving their issue
of high usage of smartphones
by their employees due to
which their productivity has
been reduced.
We only have one customer
segment which is corporate
houses to which we are
offering our application
software of Xerofone.
Customer Relationships:
Our customer segment of
corporate houses expects us to
maintain a formal relationship by
which they can contact us for
after sales services.
These relationship with customer
segment is expensive as
management of our organisation
has to not only assist about the
usage of our application at the
time of sale but also after the sale.
Customer
Segments:
We have a
business model of
B2B due to which
we only have one
customer segment
which is corporate
houses from
which we create
value by charging
them a fee against
the usage of our
software
application.
Key Resources:
Our key resources are skilled employees who
develops and maintains the software
application.
Our distribution channels are human resource
management firms which often act as
intermediately to us.