Innovation Flashcards
Innovation definition
The creation of a new idea plus the process of developing and implementation of that idea to make a business successful
It is the adaption of a business to the changing market to ensure profit and growth
Innovation = invention + exploitation
Creativity definiiton
An unplanned activity that is neither right or wrong and creates a question
Design definition
a planned activity leading to a preferred outcome and the process of creating a tangible entity
Invention definition
The creation of a new idea
What are the four drivers for innovation?
Technology
Customers
Business Environment
Competition
What are the five types of innovation?
Product Process Service Business Model Organisation
Describe product as a type of innovation
A product is anything that can be offered to a market that might satisfy a want or need. It can be tangible or intangible (haircut). It travels from consumer to customer, B2B via the manufacturing and processing of raw materials and components
Describe processes as a type of innovation
This is referring to the raw materials and techniques and methods being utilised for production. Businesses must take into account the logistics of distribution as well as packaging and waste disposal.
Describe services as a type of innovation
Services are generally intangible and are carried out by specialists. This includes car wash, tailors and hairdressers as well as online retailers such as ASOS and PayPal
Describe business model as a type of innovation
describes the rationale of how an organisation creates, delivers, and captures value in economic, social, cultural or other contexts.
Examples include Amazon’s in comparison to eBay and Gumtree (instant purchase vs bidding vs localised marketplaces)
Describe organisations as a type of innovation
the implementation of a new organisational method in the firm’s business practices, workplace organisation or external relations
It also refers to the culture in the workplace - Google provides sleeping pods in hopes of improving productivity and general retailers such as M&S offer a discount to employees.
Example of innovation
1980s: The Hoover Twin Tube Washing Machine (average wash time: 4 hours)
2019: Samsung Ecobubble Washing Machine (average wash time: 15 mins)
Why doesn’t every business innovate (barriers)?
Limited opportunities Assessing innovative ideas Speed of change Risk of failure Cost of resources
Factors that influence the rate of adoption (5)
Relative advantage: the innovation must be better than what already exists
Complexity: the innovation should be easy to use?
Compatibility: the innovation must be consistent with the adopter’s needs, experiences and values
Trialability: the idea or product can be trialled on a pilot basis. Can people easily try it out?
Observability: can people observe the innovation being used by others
The innovation should ideally have the ability to be changed and amended to adapt to its local environment
Business example of innovation
Nokia vs Apple
Nokia N Gage: had the relative advantage and was a new concept (smartphone and game system hybrid)
Compatible with a youthful demographic to capitalise on the growing games industry
Wasn’t successful: the GBA outsold the N-Gage 100:1. Nokia only managed to reach a third of its expected sales of 6 million units
Apple iPhone: released in 2007 to rave reviews and sales
Touchscreen and home button concept - revolutionised with adaptive compatibility and UI/UX
High resolution camera
Influenced by the N-Gage gaming component and led to a boom in mobile gaming (App Store)
Ability to browse the web, listen to music and read books on your phone
