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Innovation is considered as one of the critical factors to drive the social and economical development as well as success of any organisations. Hence, innovation within the organisation can be associated with processes or products that results into enhancing the customer and shareholder values. Innovation requires changes and these changes can be incremental, radical or disruptive in nature. However, innovation is an activity which consists of inherent risk with uncertain technical, commercial and financial returns in future. The Small and Medium Enterprises (SMEs) are more prone to failure in the innovation commercialisation due to limited resources and ability for coping all the investment risks, hence it is important to analyse every aspects before committing to any change (SearchCIO. 2017). The present report aims at analysing the significance of innovation in any organisation through a case study of a SME Brainlabs. The Brainlabs is the digital media agency in United Kingdom that works on making marketing more scientific instead of taking traditional approaches for the coding of teaching marketers regarding regression analysis. Brainlabs team consist of mathematicians, programmers and scientists who help in designing new kind of marketing strategies.
Innovation eludes change in the procedure of product manufacturing, presenting or services. This could mean for an organisation to incorporate new ideas, to make dynamic products and to enhance the services (Solihin, 2018). Often innovation is confused with invention whereas both are distinct terms with completely different meaning. Innovation means to introduce changes in the existing system and to adjust according to those changes that will lead to better products or services. On the other hand invention means creating a new process for the first time. With invention the organisation present any product or services for the first time in the market which can be subjected to success or failure but with innovation the organisation is capable of gaining competitive advantages in the market (Spulber, 2014). Innovation is used as a critical tool to evaluate the business environment and to sustain in the market for longer period of time. The market pattern is prone to frequent changes therefore innovation plays a critical role to stand in front of the competitors and survive the ever changing environment. An organisation which cannot innovate using their current assets, resources and opportunities then it is liable of facing risks in the competitive market. Innovation can affect greatly the total procedure of providing services or producing products. Although innovation means bringing changes to already existing systems as per the market demand but it is also subjected to risks if the gaps are not identified properly. Identifying the gaps accurately helps in making improvements in future and to incorporate right innovations (McDonald & Wilson, 2016).
Brainlabs being a digital media agency need to keep on incorporating new ideas to keep in pace with the competitive market as well as satisfy their clients. The organisational leadership, vision, working culture and teamwork practice has significant impact upon the innovation and commercialization. The vision of an organization helps in determining the decisions to be made that will be profitable for the organization in future. Long term decisions are more profitable as the organization in order to achieve the vision incorporates number of innovation as per the situation of the market. The innovation of the workplace is highly influenced by the environment of the organization. When the employees of any organization are provided with opportunity to bring out their own idea, services and methods of doing work then the organization becomes highly innovative (Jonathanhalls.net, 2017). Leadership plays a significant role in increasing the creativity status of any organization. Directive or participative leadership majorly contributes towards the profit of the organization. However among the two it has been found in many research works that the participative leadership helps in empowering innovation and bring improvements in the thought processes of the employees. The cross functional activities in the organization help in establishing coordination in the downstream and to encourage the next generation (Burns, 2012)..
For the digital media agency like Brainlabs where minds from different specialisations work together to provide unique services to their client needs innovation in three areas namely collaboration, communication and connections by incorporating new tools. A company can only work productively when the knowledge is used across the company with collaboration approaches and tools that will enhance the ability of the employees to work in team. Therefore, innovating the process of knowledge sharing by incorporating various collaborating tools will help in improving the productivity of the company. Likewise incorporating tools for effective and productive communication and connections will help the company in achieving its goals.
Innovation no doubt interests many managers and CEO’s of World class companies. Currently, the trend of entrepreneurship, rising grants and funding for the companies demands innovations. Thus, innovation is the demand of new age companies in order to survive and sustain in the market. One of the best example of innovation and how it can be beneficial in establishment of brand image is Apple. With every new model, the innovation continues to develop thus making a trend that the other companies are trying to follow up (Pisano, 2015). It is quite commendable that Brainlab as a company has followed innovation as a part of their organisational development. In span of 5 years with different types of services and products in their portfolio, receiving the UK’s fastest growing company award implicates innovation at its best in a highly competitive market. However, it is imperative for all the 100 employees of Brain labs UK to understand what innovation is and how the culture of innovation can be implemented.
In the present section the four P of innovation commonly known as Innovation mix will be described in brief in context of current innovation and commercialisation culture to be embedded in the company. This innovation mix model was developed by Joe tidd and John Besant. The innovation mix consists of Paradigm, Product, Position and process. It must not be confused with marketing mix of 4 P’s. The advantage of using this tool is it helps us to know in which area we need to develop and where Brainlabs need to go in future to hit the target market.
The first P s paradigm that advocates learning the framework first that what we do. For example Brainlabs is a digital marketing agency having different products for different types of business and data analytics. It is necessary to understand then what innovation can lead to leverage of profit. For example- making the process of innovation and constant development standardised, optimised and producing it as a training program makes it scalable as well as commercialese the innovation. But the next question should be what are the process and does this process is a real need. Not necessarily all paradigm shift processes or innovation would have positive effect. Therefore prior to bundling the current innovation and commercialisation strategy into a product needs thorough research (Ivanova and Leydesdorff, 2015).
Product – In this context the service. The question that Brainlab team must ask to themselves repeatedly is what their product portfolio should look like in future and how good are they in innovating the product portfolio. The change can be either radical or incremental change or both. Considering the growth and speed of Brainlabs it is suggested they must include incremental to the existing product portfolio and radical changes in their process or trade secrets such as innovation and commercialisation embedding strategy. The suggestions that will develop through this brainstorming stage can help Brainlab to develop a service portfolio that also includes training and support program (Luzinni et al., 2015).
Process – In general it is the procedure that enables or helps in developing a product. But in present context it is what are the steps that helps in development of ideation and commercialisation culture and how Brainlab is visualising to develop the strategies as a practice model or implementation model. All the steps that lead to such a strategy and visualisation of that dream must be included in the analysis and how it can be used to improvise the process towards profitability. Profitability not only means financial profit it could be expanding the customer base that can be considered as profitability (Kivimaa and Kern, 2016).
Position – This is the last step of 4P’s of innovation where the company decides in which area they are targeting. As a consultant for the current business scenario, it is important to understand how the current embedding process can be developed into a future product for implementation and whom we can target. The current business scenario implicate, our targets should be small and medium scale enterprises as well as start ups looking towards innovation and commercialisation. Since this is a business to business company, the clients or target population includes already existing business units in the market (Barret et al., 2016).
Once the types of innovation are identified in the parent organisation, the next step is to commercialise the innovation. Current technological developments, emergence of social media marketing intense global competition and shifting patterns in digital media markets compels the industries to understand the commercialisation process and funnel approach to ideation. It advocates the company to invest in new product development process not only for profit but to survive in the market. The new product development provides a competitive advantage to the company. But despite new product development process and knowledge many products fail to find a way into the market. Research suggests, without a structured process or information it is difficult to convert concepts or ideas to commercialisation (Do et al., 2018).
Therefore, from Brain labs point of view it is imperative to understand the commercialisation funnel and New Product development process. The commercialisation process involves three basic stages such as ideation phase (ideation funnel), business process stage and stakeholder stage. It needs to be integrated with New Product development process. In this section we will evaluate how the commercialisation and new product development process can be implemented in an integrated approach and at the same time what measurable outcomes need to be developed (Bengtsson, Stefan and Lakemond, 2014).
In a commercialisation funnel there are three phases or stages. In the widest part there are number of ideas or innovations need to be screened. This can be called as capturing moment. The middle section is the part where different aspect of ideas are analysed such as consumer demands, market demands, feasibility, profit and loss analysis and long term sustainability issues, dissemination of products or process. This step can be called as creation stage. When the funnel narrows down, the end product either in the form of a tangible product, service or process comes out. The end product is marketable and commercialised. But commercialisation itself is a large part of feedback loop that demands further adjustments to the current process. In that process new product development process can be helpful (Costello, 2015).
In a structured NPD process there are three main stages, marketing, design and manufacturing. However such a marketing process was very linear and the information gathered at one stage gets transferred to other stages. But the main issue in this approach is it is problematic over the wall like system. As a result the time between ideation, innovation to commercialisation increases significantly and exceeds the allotted timeline. It also increases the documentation at each stage. This model given by Russell and Taylor in 1995, failed to be adapted by the companies because departmental working culture difference led to late response to problems raised in one department to another. Secondly, the cost and timeline allotted or estimated for a particular project exceeds resulting in unnecessary delay in the process. However, cooper in 1993 provided a much better version of NPD commonly known as stage gate approach (Torress et al., 2015).
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The stage gate system of NPD breaks the NPD into recognisable five stages. There are two significant features of stage gate NPD system. Firstly, there is no particular marketing or research stage that has been integrated into stage 1; secondly the number of stages can be increased depending on the need. The model was popular and continues to be used in different companies because it has the feature of any modern project management tool. The information gathered at one stage helps in progress of the project and act as a guiding material for next stage. Each stage comprises of people from different disciplines working towards a common goal, thus preventing the chances of error due to intra review system. Each stage comprising employees from different functional areas are required to gather information and analyse its implications from technical and business point of view (Tukker and Tischner, 2017).
The stage cost takes an arithmetic scale where the stage 2 cost is higher than stage one and so on. The advantages of using such an NPD process for the current innovation and commercialisation strategy used in Brainlabs is, based on the time allotted to the project, type of project and project demands, the stage gates can be squeezed, expanded, forwarded (where one stage can be initiated, even though the previous stage is not completed) and stages can overlap each other. The five stages of new product development includes Initial investigation , detailed investigation, Development, Testing and Validation , Full production and Market launch, and Reality (Gelling and Seuring, 2014).
Integration of funnel approach to New product development can be done by putting end of the funnel to the start of New product development process. For example In the present business case, the embedding of culture of innovation and commercialisation in Brainlabs organisational culture demands Democratalisation o ideation implicating each and every employee of Brainlabs has the right to innovate and share the ideas. The funnel approach advocates gathering of ideas from relevant sources, aligning external information with internal settings, finding the connecting point and if any gap exists how to approach those gaps. Thus from capture point of view what steps can ensure each employees gets the right platform to share their innovative ideas for commercialisation, how it relates to our potential customers (especially the client’s who are interested in streamlining their products or business through our analytics), and what gaps are existing in the market. Thus, once the ideas that met these parameters are identified, they can travel to next step that is creation stage. In this stage the goals need to be matched and the knowledge capabilities must be analysed. In our case the question whether this innovation and commercialisation culture can be developed by 100 employees of the company or need to be collaborated with external agencies. Secondly, many companies look towards already established tools and techniques to be implemented , there it must be cleared with the top level management that whether they are ready to embrace the new technology or want to get directly from outside. Once, the ideas selected get pass through these stages, the next step is assessment of returns and risks involved to the business as whole. It is the most important part, since from here the idea will get into stage gate process. Therefore, steps towards democratise of ideation and steps to be followed need to evaluated in terms of tangible/intangible profit and loss. The seed of innovation has already undergone much evaluation stage now it is the time to get this seed into stage ate process for development into a full commercialised process.
Outcome measures – In the entire process of commercialisation process funnel and new product development there must be check gates such as measurable outcomes. The long term survivability of Brain labs depends on how long they can sustain their innovativeness and product portfolio with changing demography digital media. The new products, services and trade secrets are the lifeblood of a company. In the present scenario, the management must understand the current strategies to embed innovativeness and culture unlike product development technology that is patentable comes under the trade secrets. To make it commercialised, it must be evaluated and tested vigorously in different settings before being developed as a complete package (Johnson, 2016).
It needs to constantly innovated and practiced in order to meet the growing customer needs. In the present scenario, the task is tough as the concept of an idea need to be developed into a complete commercialised package. Prior to that much needed market research need to be done. The outcome measure tool to be implemented in order to evaluate the success and failure must be tested and optimised. Based on such rigor method and standardisation protocol with internal parameters, the present strategy of innovation and commercialisation can be successful. Implementation of commercialisation funnel and new product development process can ensure the right product is developed and reach to the right customer. However, Brainlabs must evaluate their internal strength if they are naïve to such process.
As described in earlier Section, Brain labs have created a unique niche in competitive digital market employing scientific and unique analytics that breaks the conventional approach. Our innovative products like MC3, bHeard Survey, workplace insight etc has been able to break the barriers and within a span of 5 years the company has 100 employees and two awards in its name. This implies how in these 5 years the company has improvised strategies, created new innovations and protected their ideas from getting infringed by other companies. Apart from these many innovative products, in recent years the innovation culture and commercialisation culture strategies that have been developed need to be protected.
But before going into details like how and what strategies can be used by the current organisation to protect the ideas, it is imperative to understand in what context these ideas are innovated and how they will help the organisation in future. In contemporary business environment, fluctuations in business economics, changing consumer expectations and new entrants into the market as a SME Brainlab was committed to keep its pace of unique innovation and commercialisation of products. The pressure on the management increases as the products of a digital marketing company unlike people products based company lacks huge customer base. Secondly with new entrants in this sector every year and innovations from their end, if Brainlabs need to staying the market it needs to adapt the innovation and commercialisation in its organisational culture. Companies like Beyond, RedWeb and Momentum Design lab are some of our competitors who can give strong competition to us in near future. Redweb is an award winning digital company that has created buzz in industry by challenging some digital media agency already in the market. Therefore, incorporation of innovation and commercialisation was an absolute necessity. Another important case study is Nokia the Japanese Mobile manufacturing giant in 2000’s. It was the leading mobile manufacturer till 2006-2007, but with the advent of android and Smartphone, lack of innovation and commercialisation in Nokia Company led to complete wipe out of Nokia mobiles from market. Although, later they developed their products and innovated their manufacturing process but the market has been already taken by number of small and big giants like Samsung, Lenovo and Motorola.
But in context of Brainlabs, the current innovation and commercialisation ideation that can be embedded into organisational culture unlike product innovation cannot be patented. The ideas such as innovation ambition set up, democratisation of ideation cannot be patentable or copyrighted. In that case the company will look forward to disclosing such ideas under a contract that compensate us for ideas. This is because, the mental steps or management steps doesn’t lead to development of direct product or services. But it acts as a medium that can lead to new innovative products and services. Thus our innovation and commercialisation strategies developed can be categorised under trade secrets that is protected by Common law of confidence in UK.
Trade secrets protection is available to the individuals with ideas for a particular process or technology. In our case it will be beneficial, we can keep the trade secret confidential and later license it to Client Company. The advantage of this strategy is trade secret have an indefinite life, therefore if protected can give a competitive advantage to Brainlab Company. The products developed by the Brainlab and other companies such as Red Web and beyond undoubtedly can lead to patent and earn millions. But, the knowhow of setting up of an innovative workforce where innovation and ideation to commercialisation has more value than the patent. Such an ideation can lead to development of workforce in any company. However, this has disadvantages too where the client company looking towards adapt such an idea to improvise the workforce will ask to disclose the know-how. Then it is solely with the company how they utilise or disclose the secrets to other organisations. Brainlabs will overcome these pitfalls by making agreements with existing partner and in future bundling with available products as a business training program or education. Therefore the current innovative ideas for ideation and commercialisation must be developed, maintained and integrated into practice (Kontigiani, Barankay, and Hsu, 2017).
As evident from cases like Kodak Camera, Nokia phones constant innovation and looking forward to innovative ideas is the call for this digital transformation age. Thus, the innovation culture and commercialisation culture must not step. According to management pundits and researcher’s one of the major barrier to innovation in an organisation is bias towards creativity. Irrespective of type of organisation whether employees are encouraged to share their research ideas or not, two basic questions are posed by the management. The first question is how best mindset and does this idea has any potential market. The issue with these questions is it is difficult to ensure exactly how best the idea is. But in order to avoid such dilemma, it is necessary to understand innovative ideas are creative thus it is difficult to know what will be the exact effect. This will help the organisation to invest in such ideas. In context of potential market issue, the current innovation culture employs scientific instruments and analysis to develop the products. Therefore, in case any new idea is proposed by the organisation the potential market can be build.
Another established strategy is empowerment of line managers in an organisation. In most cases, the innovation and commercialisation culture sustenance is an issue as the managers fails to encourage their fellow employees to come up with new ideas. This is in turn results from poor understanding of top level management. Thus, empowerment of line managers who works closely with the employees can help in maintaining the innovation and commercialisation culture. A transformative leadership approach is sought that can help in addressing the case. Not necessarily, every innovative idea will pass through the innovation funnel and result in innovative products. But innovative ideation attempts need to be rewarded too in order to overcome barriers to innovation and develop an innovation and commercialisation culture (Sharma and Kirkman, 2015).
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- Do, H., Mazzarol, T., Soutar, G. N., Volery, T., & Reboud, S. (2018). Organisational factors, anticipated rentsandcommercialisationin SMEs.International Journal of Innovation Management,22(02), 1850018.