Mgb101 Business Innovation - Social Assessment Answers

Question

1. Why it is important for organizations to be innovative?

2. Why it is necessary to acknowledge that innovation applies not only to products but also to services and processes?

Answer

The Importance of Innovation

1. Innovation and creativity are two crucial concepts for an organization through which constant growth, overall development and other objectives could easily be attained. Along with this, innovation helps the organization to retain its position amongst the target market. With the help of innovation, organizations could easily develop its effective image in the target market which directs the organization towards attaining competitive edge over other companies in the industry (Birkinshaw, Hamel & Mol, 2008). For example, Amazon is one of the behemoth players of online retailing industry and in order to retain their acquired leading position, organization constantly tries to update their products and services along with introducing innovative and creative products and services for retaining customer’s interest in the organizational products and services. Amazon’s latest and new products are Amazon Prime services under which they provide entertainment content to their users. Apart from Prime Services, organization is now planning to introduce drone delivery system through which consumers will be able to get their ordered products up to 5 pounds within 30 minutes from the time of placing the order. Drone delivery is yet in beta testing and it is tested in Cambridge and in the UK. With the help of drone delivery system, organization would be able to expand its market share in the target market along with enhancing its revenues, sales and profitability. Thus, innovation and creativity, both are crucial concepts for an organization and in relation to this; every organization should promote and encourage their employees to think out of the box in order to generate new and creative ideas for the objective of gaining competitive advantage (Varis & Littunen, 2010).

2. Yes, the above statement is true because innovation helps in enhancing the effectiveness of products as well as of services. Innovations are sort of new ideas through which effectiveness of existing products and services could be enhanced as well as make it as per the latest market conditions and consumer’s demands and wants (Sawhney, Wolcott & Arroniz, 2006). For example, business entities were used to promote their products and services through traditional approaches such as newspapers, magazines, board hoardings, etc. till the time, internet and globalisation were introduced in the business markets. After introduction of internet and globalisation, promotional campaigns of the business entities have entirely been changed. Social media platforms, email marketing, search engines, third party website promotions and many more are innovations of internet which have helped the business corporations to expand their businesses by promoting their products and services in various markets with the help of digital promotional tools. Thus, innovation of internet is a type of service through which various platforms of promotion and advertisement have been introduced through which organizations have expanded their businesses in the domestic as well as in international markets.

Apart from this, innovation also applies in the processes such as back in 1970s and 1980s; traditional approaches were followed in businesses for executing manufacturing related activities. Mainly, manual techniques were used whereas, with the help of innovation in technology, advanced machineries have been introduced through which manufacturing activities could be easily be executed along with higher productivity. Thus, innovation could be applied in products, services as well as in processes (Harris, 2015).

References

Birkinshaw, J., Hamel, G. & Mol, M.J. (2008) ‘Management innovation’, Academy of Management Review, 33 (4), pp. 825-845.

Harris, J. (2015) ‘Making it Real: Enterprise and Innnovation’, Sage.

Sawhney, M., Wolcott, R. & Arroniz, I. (2006) ‘The 12 different ways for companies to innovate’, MIT Sloan Management Review, 47 (3), pp. 75-81.

Varis, M. & Littunen, H. (2010) ‘Types of innovation, sources of information and performance in entrepreneurial SMEs’, European Journal of Innovation Management, 13 (2), pp. 128-154, Emerald Insight [Online].