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Innovation is the practical implementation of a revolutionary idea that will result in some product or service that will help mankind. In every entrepreneurship, the importance of innovation is undeniable. At the same time, while starting with a proper innovative plan, the entrepreneurs should market it in the right way. The proper marketing strategy will eventually help the organisation to commercialise innovation. Commercialisation of innovation is important as it will fund the further up-gradation of the innovation. At the same time, commercialisation will eventually motivate others to innovate more products or services which will be essential and useful for mankind. In this report, the importance of innovation in various kinds of organisations will be investigated. At the same time, the process associated with innovation in these organisations will be addressed in this report. At the same time, commercialisation of innovations will be covered in this report. The process of commercialisation will be evaluated in this report later as well.
For commercialisation of any innovative idea, it is important to source and foster innovative ideas beforehand. To understand various ways of sourcing and fostering ideas, a few specific examples are discussed below.
Fig 1: Growth of Apple
(Source: Apple, 2022)
Apple is a California-based company focusing on consumer electronic goods. Currently, the company is one of the big five companies in the United States focusing on information technology. Innovation plays a key role in this company as Apple deals with electronic goods mainly. Apple decided to update Safari, the fastest browser in the world while giving it an extension with editorial spotlights. At the same time, the company introduced Mac Catalyst to developers to make their work easier. iOS 14 is an improvised version of the app library to organise all the applications of users. Apple constantly tries to enhance its products by updating and introducing new innovative technologies (Apple, 2022).
The fish skeleton model is used to understand the sourcing and fostering of innovative ideas in Apple. Customers generally want more modifications and features in their electronic goods. The more modifications, the more will be the sales of the product. Personally, to engage more customers, the company too wants to add more technologies. It will increase the price of the product eventually. Being headquartered in California, the company gets to work with many innovative engineers. At the same time, the competition in the relevant industry also motivates the company to produce more innovative ideas. The company and its CEO, Tim Cook motivate people to innovate products and fund these innovative ideas in the company (Apple, 2022).
Fig 2: Revenue of Tesla
(Source: Tesla, 2022)
Tesla is currently the most valuable automotive company in the world. The company has almost 361 patents including electric vehicles. The company innovated Firewall which is an integrated battery system. At the same time, the company also innovated solar roofs and solar tiles. The main motive of the company is to build something from renewable sources of energy. Tesla Megapack is an innovative approach that gives rise to the largest energy project in the world. This will help to charge all these electric vehicles made by Tesla (Tesla, 2022).
Again, the Fish skeleton model is applied to understand the sources of these innovative ideas. The company tends to target the rich segment of the market. These customers require something which can not be easily available in the market. The company also shares the same vision while they have one objective to bring revolution to the world using renewable sources of energy. To survive the competition in the automobile industry Tesla wants to provide innovative approaches to its products. At the same time, the high revenue of Tesla provides motivation to do something better. The skills of the engineers working there also promote the idea of innovation Tesla, 2022).
Fig 3: Net earnings of Boeing
(Source: Boeing, 2022)
Boeing is a multinational company aiming towards selling aircraft. Currently, the company is the third-largest company providing defense to various countries in the world. Innovation is very much celebrated in the Boeing company. The company mainly deals with rotorcraft, aircraft, and satellites. The company needs innovation to upgrade the system every now and then with the advancement of technology. At the same time, safety is a major issue for the company. MQ 25 Stingray, Boeing 737 MAX 9, 787-10, and Boeing HorizonX are examples of brilliant innovations of the company (Boeing, 2022).
While applying the Fish skeleton model, the sourcing of these innovative ideas can be clear. The company mainly deals with aerospace technology. Customer safety and comfort are the main two reasons for these innovations. The company also generates high revenue while selling these products. The amount is almost 62.29 billion USD (Jugend et al.,2020). At the same time, the competition and market requirements are the main environmental issues behind these innovations. The company already has experience in generating and operating aircraft and satellites. These skills are mainly used while producing these products. On the other hand, the company invests 3 billion USD annually for research and development purposes. All these things trigger the necessity of innovation in Boeing.
Sourcing and supporting the ideas of innovation are very much important for organisations like Boeing, Apple, and Tesla. These companies mainly attract more customers use innovations as a marketing strategy for the products. To analyse the sourcing and supporting reason behind these innovations, the three needs theory is applied. This theory was introduced by McClelland to understand the achievements of any organization. This theory is mainly based on power, affiliation, and achievement. This motivational theory will help to understand the influence of some behaviour from the managerial point of view (Bloom et al., 2019).
Power is needed when some organisation wants to have authority over others. To rule the relevant market, it is important to have the power. Power can be achieved by the leaders who have the confidence to bring revolution. Boeing is a company that is now one of the leaders in aerospace technology. They are bringing innovation to gain that power to rule over the other competitors. At the same time, Apple is bringing innovation so that it can rule the market of consumer electronic goods. On the other hand, Tesla is bringing revolution while introducing electric vehicles in the automobile industry.
Achievements are required in every organisation. The main objective of any organisation is to achieve something. The companies try to achieve something while they are participating in the competition. Likewise, Apple being in the electronic market tries to give its best. Providing first-class gadgets can help them to achieve desired revenue and customer base. The same happens with Tesla and Boeing (Chen et al., 2018). Tesla being an automobile company, tries to achieve the best position while introducing electric vehicles. Their innovation is actually revolutionary though. On the other hand, Boeing trades with aircraft, and satellites. To mark a position in the relevant industry the company will try to incorporate various innovative ideas (Dziallas and Blind, 2019).
Affiliation generally drives the urge of the organisation to connect with society and other people. To attract influential people and society, it is important to show them something out of the box. Sourcing innovation is the only way to affiliate the company with influential people. For example, Boeing has partnered with Microsoft and is working to achieve excellence. At the same time, Apple has affiliated its operations with Salesforce to engage more customers. Apple does have an affiliate program where common people can promote and sell products. At the same time, Tesla also offers affiliate programs with high commission rates (Kahn, 2018).
Innovation is nothing but a proper implementation of some idea that will produce a new product or service. These products and services are supposed to generate more revenue for the organisation. There are various kinds of innovation that will be explored in this report. The red ocean and Blue ocean are important processes of innovation.
(Source: Olimov, 2021)
Red ocean is basically a strategy of innovation that associates the organisations which are already competing in the relevant industry. Red ocean strategy often needs to face intense type of competition in the industry (Olimov, 2021).
The goals of the red ocean innovative strategy are to beat the existing competition in the relevant industry. Along with it the
Focus of the products
At the same time, commoditization of companies happens where the organisations mainly fight for a specific price range. This strategy basically produces a product or service which will survive in the relevant industry while making profit. The focus of this kind of strategy is on the price of the product or service. The organisation gets to decide about the price and cost structure of the product.
Exploitation of demands
At the same time, the organisation can exploit the demands of the products in the existing market.
Quality of production
Quality of production and distribution is quite improved in this strategy of innovation.
Reliance Jio can be a perfect example of Red ocean innovation strategy. This market of telecommunication is already crowded with various players like Vodafone, BSNL, Airtel etc. Reliance jio without fearing the chances of its competitors, infiltrated the market with the strategy of innovation. The company used innovative ideas to attract more customers. They offered more talktime and data at a lower cost comparatively. When they achieved the customer base, the company slowly started to increase the prices of the services. At the same time, the company innovated a few features which are offered with these services (Amaliah and Aspiranti, 2022).
The Blue ocean strategy of innovation creates a demand in the market where there is no competition or demand. The blue ocean strategy has more potential as it arises by expanding the demands of the red ocean strategy (Samrin and Irawan, 2021).
The main goal of the blue ocean innovation strategy is to find a suitable and proper marketing strategy. At the same time, it aims to a market where there is no more competition. No other competitors are there in the market.
The focus of the products
The focus of the products is on capturing the market. While entering the market, the organisations need to decrease the price of the products.
The exploitation of the market
The market will not be exploited. Instead, to enhance the market, the companies will try their best to mitigate possible risk factors. At the same time, losses will be minimised and chances of success will be maximised.
Quality of production
To improve the quality of production, generally, common frameworks and strategies will be applied. At the same time, the employees will be trained properly to improve the quality of production.
Airbnb can be an excellent example of where blue ocean innovation strategies were applied. It is a digital platform where people can choose places to stay while going away for vacation. Instead of hotels, the company is affiliated with various homeowners who are willing to rent their properties (Leavy, 2018). Before Airbnb, no other company had this kind of vision. The company tried its best to innovate a new strategy to provide homelike services to tourists. At the same time, the company did not have to face any kind of intense competition in this field. There are not many competitors who are providing homes for rent.
Different types of innovations are actually successfully helping various kinds of organisations to enhance their growth in the relevant industries. To understand the processes of these strategies in various industries an analysis is done here.
Red ocean innovation strategy
Red ocean innovation will be helpful for those organisations that already have many competitors in the industry. In the hotel business, technology-based business, and cosmetics business, the red ocean innovation strategy is mainly used. The main aim of this strategy is to innovate something different than the competitors which will be able to take over the market. Thus companies try to differentiate their products. Some try to diversify their range of products to survive in the field. Red ocean strategies try to capture the market while infiltrating the market with new ideas. At the same time, to achieve success, the companies need to attract potential customers by providing them with more value (KWAK and CHA, 2022). They can decide their own prices but they have to keep them a bit low to compete with the others in the same industry. For example, Mcdonald's is a fast-food chain that has so many competitors in the market like KFC, and Burger King. To survive in the market, the company started selling fresh ingredient burgers at comparatively low prices in a traditional way. Aggressive marketing is another way to achieve success as per the red ocean innovation strategy. Amazon follows aggressive marketing in the e-commerce industry.
Blue ocean innovation strategy
The Blue ocean innovation strategy is helpful for those organisations that are very much new to an industry. For example, Apple is the first company that brought earpods into the music industry. Seeing their success other companies like Boat, and Bosch also introduced earpods. In fact, these organisations are trendsetters or industry makers. The aim of this innovation strategy is to make competition irrelevant because the organisation will be the trendsetter in this case. For example, Canon first started selling small desktop printers and created a market. After that large-sized printers were not used anywhere. At the same time, a new business will proliferate where there is no pricing structure beforehand. Blue ocean innovation strategy proceeds to find new opportunities while building a proper market for the new venture. At the same time, this innovation strategy tries to make products or markets which can have alternative options as well. Uber did not make any new service or product, it just changed the operations of the cab industry. The innovations are done in a way that can clearly make new demands in the market. For example, Netflix changed the traditional way of streaming services. They made new demands for online streaming services (De Silva, 2019).
To commercialise innovations in any organisation, planning of the innovations along with the potential challenges, funding and resources will be required. Here, Unilever is taken as the reference organisation where innovation will be commercialised. For this purpose, planning will be done beforehand along with an estimation of challenges, finding proper funds and resources will be required as well .
Planning innovation is an important part while commercialising any kind of innovation. Unilever for the last 100 years are innovating products and they are constantly planning more innovations. 2.5 billion people are using products of Unilever. Unilever is the owner of many small brands where the company is trying to innovate something for everyday use. Being a consumer good producer company, Unilever needs to take care of the customers and their daily requirements. The company is now thinking of producing some healthy superfoods for its customers. Every day, the company is planning to make the environment more sustainable while producing other products (Reyes et al., 2021).
Challenges of innovation
While innovating, Unilever also has to face a few challenges. The failure of innovation is a huge challenge for the company. The company is investing money in each innovation and the failure can cost them a lot. At the same time, the acceptance of the innovation is a challenge itself. Not always the consumers accept the products open-heartedly. At the same time, a marketing strategy can often be a huge challenge for Unilever. Without a proper marketing strategy, one innovation can fail. For example, Ponds is owned by Unilever. Once, Ponds decided to sell toothpaste which was a huge disaster. Ponds is celebrated as a women’s skincare brand and people did not take any toothpaste product from Ponds this easily (Addo et al., 2021, November).
Unilever tries to fund its own projects and innovations. Currently, 800 million euros are invested in the research and development department of Unilever for innovation purposes. The company also offers funding programs in various countries to motivate innovators to work with them. In South Africa, Kenya and Nigeria the company is funding for innovative solutions. The company partnered with UK KTN for this purpose as well. The company has established a foundry where innovations are celebrated with proper collaborations. A 50 million USD pilot investment is done and 40,000 startups were given opportunities (Wang et al., 2021).
Unilever is a company that celebrates innovations and gives equal opportunities to innovators. In 60 countries about 5000 experts are associated with the ideas of innovations. At the same time, 20,000 patents are registered from Unilever. UK Materials Innovation Company of Unilever uses artificial intelligence for innovation purposes. The highest concentration of robots can give 10 times faster results. Shanghai, China is also a hub where the company uses digital methods to innovate new technologies and products (Unilever, 2022).
Entrepreneurism is a way to promote and commercialise innovations. Entrepreneurship is nothing but building a setup that will promote innovative ideas and a potential customer base will be built eventually. Unilever also promotes entrepreneurism. Unilever Foundry spent almost 50 million USD to promote 40,000 startup plans. All of these plans are promoting some sustainable and biodegradable innovative plans. Entrepreneurship will be successful whenever innovative planning is launched by it. People will be attracted to the innovative plan and this will enhance the customer base of the entrepreneurship (Gosens et al., 2018).
Corporate innovation is nothing but thinking something offbeat and innovative strategy which will enhance the growth of the existing business. The innovation team will be required to do some corporate innovation. Companies like Unilever also believe in the theory of corporate innovation. They sell products that are a little innovative by adding a few new features to the products. At the same time, the company aims to grow sustainably. The company tries to produce things in a sustainable way to minimise any kind of chances of pollution. Unilever generates products that are biodegradable using various biological technologies. At the same time, these technologies are sustainable enough. To reduce carbon footprint, the company tends to use more artificial intelligence for accurate work (Boni, 2018).
Product development process has 6 consecutive steps which are very important. Idea generation, product definition, prototyping, initial design, testing and validation, and commercialisation are the 6 steps that are followed by any organisation. In this case, lux body wash is taken as the product here.
Lux is a company owned by Unilever. To infiltrate the cosmetics company, Unilever decided to introduce Lux to the consumers of third-world countries. The soaps of Lux are quite famous among the civilians of these countries. This time, the company decided to sell body wash in various flavours.
The product is body wash, a gel soap used for personal hygiene. Previously the company used to sell soaps. Now to compete with others, the company intends to sell body wash. The company is willing to body wash in 6 different floral flavours. The main USP of these products is the smell of flowers (Li et al., 2020).
Prototyping is basically the primitive model which is not for sale. It is made to understand the market requirements. A prototype is also designed for Lux body wash which is not for sale. After getting some feedback more features will be added to it.
At this stage, the product is ready for testing purposes. If the body wash now passes the tests, then it will be commercialised for sale. The design of the body wash bottle is made in a way that all the ingredients are mentioned. At the same time, USPs are mentioned in the bottle. The design should be interesting enough so that customers feel attracted and buy the product.
Validation and testing
Validation and testing are the most important part of a product development process. During validation, a few tests are run to understand if the product is ready to launch or not. Testing is required if there is any other problem with the product or not. Same way, the body wash of Lux will be tested and validated before launching.
The final test is commercialisation. Commercialisation is nothing but promoting the product to sell it to the customers. For this purpose, various marketing strategies will be used. In this case, to promote the body wash of Lux, advertisements will be given on various TV channels. At the same time, social media will be used to promote the product. A few celebrities and social media influencers will be asked to promote and commercialise the product.
Before launching the product it is important to calculate the potential risk factors. A few risks can arise while producing and marketing the body wash of Lux. The product may not pass the validation tests. At the same time, the product may not be successful in the market. There may be some faults while making the product. Otherwise, the product may miss the deadline of launch.
An institutional source is nothing but an entity that will provide information about the company to the insurer. Unilever has its stakeholders who will be providing information to the insurer. Code of business principles and code policies will be used while engaging the stakeholders with such responsibilities. At the same time, the company will be working with 148,000 people from 100 countries as stakeholders who will take responsibility for the company.
Sources of fund
To operate the production system of body wash by Lux, the company will provide the fund. Annually, the company spends 800 million euros for research and development purposes. Being a brand established by Unilever, Unilever will be taking the financial responsibility for the project.
While going through the entire report of production and commercialisation of a product, it is important to protect the product as well. Otherwise, all the strategies used and the labour will not be fruitful. Someone else may copy these strategies and can make the product and the original organisation will not get any recognition. While making a product for commercial purposes, six steps of the product development method will be followed. Sourcing innovative ideas is the most important part of a 6 steps product development. Here a new idea is given to the product developers and then they try to make a new product to capture the relevant market. In the end, the product will be ready for commercialisation. Proper funding will be required to produce any new kind of product or service. At the same time, institutional sources will be required for a new product or service before commercialising. The entire report speaks about the importance of innovation associated with commercialisation. On the other hand, while commercialising a product it is important to protect the product from pirating or copying (Holgersson and Aaboen, 2019).
To protect the innovations within any organisation, the organisation requires to use a range of methods. Making the products and intellectual property will be helpful to protect the product from copying. Intellectual property is nothing but a product that is labeled as intangible creation of the human mind. There are a few advantages and disadvantages of labeling a product as intellectual property (Aristodemou and Tietze, 2018).
Making a product intellectual property will increase the value of the company. At the same time, it will help to market the products and services of the company. Receiving finances for the business venture will be easy as the product will be exclusively made by the company. Export opportunities will increase significantly (Grimaldi et al., 2021).
To make some product of any company as an intellectual property will require some additional cost. At the same time, pirating may happen which will tarnish the reputation of the company. In the meantime, the quality of the product may degrade if pirating happens with the product. The legal procedures will be complex enough for the organisation (Grimaldi et al., 2021).
World IP organisation is a database that will provide information about the intellectual properties of various organisations. Based in Geneva, Switzerland this company was established by the United Nations to avoid any kind of mishaps. Internationally the rules to shape the ideas about intellectual properties are decided by this organisation. At the same time, transboundary IP-related problems are resolved by this organisation. Intellection properties are promoted and protected by this organisation. At the same time a few tools are used by various organisations to protect their products from copying. Trademarks, copyright and patents are three widely used WIPO tools used by various organisations to protect the products (Grimaldi et al., 2021).
A trademark is a symbol or mark which will be a signatory mark for any specific product. By law, it can differentiate the products from other likewise products. At the same time, the ownership of the company will be recognised easily when a trademark is used. The trademarks may or may not be registered by the company but the companies can use it to mark their products. Trademarks generally do not expire. At the same time, the users need to use it on a daily basis to make it work for the products. Trademarks clear any kind of confusion because it clearly denotes the branding of the products (Eppinger et al., 2021).
As per the World Intellectual Property Organisation, copyright is a set of rules set by the owners to protect their products. Any organisation may have copyrights over its products to protect them from copying by others. Mainly the literary and artistic works are protected by copyright tool. At the same time, sculpture, books, painting, music, maps, advertisements etc can be protected using copyrights as well. Economic rights and moral rights will be given to the author when he will be using copyrights. Only the author can receive any kind of financial reward from the work and it will protect all the other non-economical interests of the author as well (Mansfield, 2019).
Patents are also awarded by the World Intellectual Property Organisation for exclusivity of any product or service of any organisation. It is generally given to any invention which will provide a new idea. Technical information about the invention will be provided to the public while declaring a product as a patent. At the same time, it can not be made or copied for any commercial purposes. On the other hand, the product owner will have all the rights to enjoy the exclusive rights of the product. Anyone breaching the rights will be sued by the product owner (Mody, 2019).
Innovation is a necessity when it comes to entrepreneurship. Innovation generally offers various ways to implement a feasible idea while making new products or services to lure the customers. The main objective of any entrepreneurship is to enhance the customer base as much as possible. Innovation will be helpful to attract customers. Innovation produces a new outlook on any product or service and customers always want something different. Commercialisation of these ideas will be helpful to attract more customers. Customers generally take cues while buying new products and services. While investing in those, they want to purchase something that will be helpful for their daily life. In this report, innovative ideas and their implementation processes in various organisations are shared. The importance of commercialisation of innovative ideas is also mentioned in this report. At the same time, the processes associated with commercialisation of innovation are also mentioned. Various promoting strategies are given utmost importance in this report.
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