Introduction
Strategic innovation is a company’s procedure of redesigning and reinvention its corporate tactics to driven business success and growth levels. This will help in generating value for an organization and its customers’ range and also develop effective competitive advantages. Such a form of innovation is important for a firm to adapt to the speed of change in technology and the latest equipment. It is that innovation that is focused on future business development strategies and activities which help in identifying the growth chances, accelerate the business decisions, and develop goodwill in a market place. This will assist in a measure of the influences of business functions and actions in regards to long terms vision for gaining sustainable competitive benefits effectively.
The essay is based on Philips which is a multinational Dutch company that is a variety of goods and services to its potential customers. The firm also provides high-tech technology and advanced equipment which increases the growth of an organization. The main purpose of this essay is to understand the theoretical backgrounds in which two topics are described such as innovation strategy and innovation as a process. This helps maintains company growth and increases the level of innovation within an organization. Along with this, the essay mainly focuses on discuss case organization, what are their products or services, location, and geographical area. Such factors are described in this essay as such assists in understanding the overview of a company in a better manner. The structure of the essay involves theoretical background, case description, case analysis, and conclusion. These are important points that are discussed and aid in evaluating the strategic innovation which needs to be adopted by the firm for better improvement.
Theoretical Background
According to Clauss & Spieth, (2016) Innovation strategy is considered as an effective plan that assists the company to enhance its market share by applying innovative methods on their items and services. It is required for an association to invest money in research and development so that they can know about the latest technology that will aid them to improve their revenues. This will help them to maintain their goodwill and along with they can able to gain the attention of customers towards products and services.
To develop an innovation strategy Organization need to follow some steps that are said by Ergunova, et. al., (2017) Firstly, it is required to find out strategic approaches and objectives that are related to innovation. After that, it is a must for the manager to examine and develop relevant capabilities that are a must. Then, they have to focus on the things and align strategies with the business targets and goals that the company needs to attain. Furthermore, it is essential to communicate the strategies to subordinates who are working on it. It is a must for superior to measure all the working timely.
Rather than this, some innovation strategies can adapt to Philips. This can be divided into four parts i.e. proactive, reactive, active, and passive. This has been examined that associations who are using the proactive method will always take advantage of others. They always want to do strong research so that they can take a lead in the marketplace. Along with this, the company wants to lead in the technology segment too. By using this methodology, the firm takes a high risk (Fischer, et. al., 2020). This is also divided into two parts; one is Radical which means to alter the services and item’s nature. And the other is, incremental that defines change the technology constantly so that the working performance of goods can be improved.
Reactive innovations methodology is utilized by those organizations that are having many followers, concentrate on their working operations, wait and look for a better approach, and not ready to take high risks. If any firm is using this method that means they are copying others who are incremental innovators. Because they want do not want to take risks and lose opportunities. Apart from this, there is another innovation strategy that is known as Active. This means the company is defending its market and technologies that are using by them (Hammarfjord & Roxenhall, 2017). But they are always prepared to respond to the market when new methods take place. They do in house research and use incremental innovation in the organization. If the firm is using this methodology, this means they are having proper knowledge about the market. They take the minimal risk because they want to control their profits and market share.
Another innovation strategy is Passive that means the association alters their products and services as per the requirement of the customer. Hence, the demand of people depends on the innovation of the items. This has been determined that Philips is utilizing open innovation strategies in their business. This demonstrates they utilize purposive outflow and inflow of information so that they can do internal innovation. This will aid them to enlarge the marketplace so that people can utilize this. The organization uses this approach so that they can earn maximum revenues by decreasing costs (Kalay & Gary, 2015).
As per Kasemsap, (2017) innovation means when an idea turns into a reality that can be related to business concept, procedure, product, business, and so on. By implementing innovative ideas an organization can improve its market share and goodwill. Along with this, they can enhance the customer base that will help them to increment of profits. An association can innovate in various ways such as product, process, and business model.
This has been identified that innovation is mostly done in products. This can be in many forms such as develop a new item, improve the working performance of an existing product and another can add a new feature in the good. Apart from this, there will be many drivers that are related to the innovation of products which can be the development of technology, needs of clients, or outdated design of items (Keshta, et. al., 2020). This has been seen that product innovation is always visible to everyone. Along with this, it enhances the demand of items amongst people that aid the company to enhance profits.
According to Mashahadi, et. al., (2016) process innovation is not considered as an effective method. This is the combination of various things such as technology, facilities, and skills. These are all utilized for the production and delivery of items and services. This has been examined that there are too many ways to improve the process. When there is a change in techniques, methods, or equipment to produce a product then it is known as process innovation. The company can also modify technologies, update software as this will assist them to improve their delivery system and supply chain management. This has been analyzed that product innovation is always seen by people while process innovation can only feel by persons internally. By doing changes in procedure the organization can reduce the cost of production and enhance profits. This sort of innovation is less risky.
Innovation in the business model never imposes modifications in product and process. But it can be seen when the company is providing items to people. This method is considered as the challenging one because this aids to present the firm in the marketplace (Masucci, et. al., 2020). This can be beneficial or threatened for the association because sometimes it will provide profits to them but also it can reduce the goodwill in the market. Henceforth, it is risky, radical as well as transformative.
Rather than this, there are many sources of innovation that have been propounded by Peter F. Drucker that can be understood by the following description. This has been determined that innovation always comes unexpectedly and by chance. Anyone can come up with a new thought that can be related to the product, process, or anything. It can say that good thing happen unexpectedly. This can provide growth and development to the firm. When an organization wants some change in their items and services, innovation happens (Oh, et. al., 2015). This will assist to increase the performance of existing products so that they can gain the attention of numerous people. For example, Philips can produce a trimmer for men that can use by people after charging.
This has been determined that the existing structure of the market can also provide rise to the association. They have to modify their market structure when the needs and preferences of people change (Oshri, et. al., 2015). Therefore, they can able to make they are satisfied with their products and services. This will aid them to take benefits from rivals and along with they can improve goodwill in the marketplace.
According to Drucker, changes in demography can also affect the needs and wants of people. Everyone wants to use products accordingly so that it is required for the company to implement innovation by keeping this in the mind. This also provides an opportunity for the association for innovation. By fulfilling the requirements of customers, they can increase their client base respectively. Rather than this, change in perception can also develop the need for innovation in products and services (Tronina, et. al., 2020). Time is changing rapidly and people want to maintain their lifestyle as per the trends. Therefore, they always want new and unique products that can provide them more comfort. It is a must for the enterprise to focus on the market so that they can grab the opportunity and increase market share.
Case Description
Philips is a Dutch international company that was founded in Eindhoven. The company headquarters is located in Amsterdam and this firm was formerly one of the leading electronics organizations all over the world (Ozkan-Canbolat, et. al., 2016). Currently, Philips is concentrated in the area of advanced technology along with a department that is being successfully divested. Philips is a multinational organization that is providing a wide range of products and services. Philips employs 74,000 employees who are performing work for managing and maintaining innovative strategies properly (Taneja, et. al., 2016). All the staff members of the organization work for gaining effective goals and targets. Philips provides a variety of electronic products and services to their desired customers. This includes domestic appliances, household products, electronics and so more. The company concentrates on selecting a target area where they find out customers who are willing to buy such firm goods and services.
In this, secondary sources are used which helps in describing descriptive data and information related to innovation strategy. There are various sources of secondary that include books, journals, case studies, newspapers and so more. Such sources assist in collecting and gathering important details for understanding the case theories and practices. Philips focuses on maintaining and developing innovative ideas that will assist in increasing the growth of the company. It is important for a firm is to concentrate on creating awareness of its products and awareness among customers (Paschen, et. al., 2020). Along with this, the Philips targets such geographical location where they can get and attract huge customers who are willing to purchase their goods or facilities. For this, they are analyzing the whole marketplace where customers willing to buy a variety of electronic products from Philips company. Philips is the Dutch manufacturing company of consumer electronics, electrical components, household appliances, medical imaging technologies, computer and telecommunication techniques, and lighting tools (Williams, 2016). The company was established in 1891 by Frederik Philips and his son Gerard who is an engineer and performs work for maintaining business growth and functions. An organization focuses on improving its business process and work to reach with desired goals (Prajogo, 2016). The company remained driven by technology, however; it is often striving for high quality rather than the lower cost of products. In the upcoming years, an organization was slow down to carry out its innovative technologies in the marketplace.
Case Analysis
Philips focuses on maintaining strategic innovation management that helps in increasing growth and development level in the market place. The strategic innovation is an important aspect which assists in enhancing the goodwill and reputation of the company in the eye of customers (Secundo, et. al., 2019). Philips is the leading company that provides different types of goods and services to its customers at a reasonable rate. In this, case analysis of the selected organization is discussed in which to understand the innovation concepts and use of various theories and concepts within Philips.
Innovation concepts
Innovation is the ability to develop new things and create new ideas. The invention is the actual procedure of formulating new thoughts and procedures which help in carrying out into existence. Every company must adopt innovative actions and create ideas that help them in gaining the attention of a huge number of buyers towards their company products or facilities (Seijger, et. al., 2019). With the assistance of innovative concepts, Philips can use this in the marketing of new or latest commodities, perform services, and manage technological processing. Innovation is important for analyzing the whole business environment so that Philips can smoothly operate their business functions. Leaders and managers of a company should be focused on and maintaining a balance of innovation (Souto, 2015). Due to the enhancement of competition level, Philips needs to continuously innovate their people and goods to remain accurate. Three major concepts must be evaluated by Philips to gain success such as innovation strategies, innovation culture, and innovation management.
Apart from this, it is not required for an organization is to only communicate regarding the innovation. But the Philips managers should make a plan and formulate an effective strategy related to how they will develop a suitable culture of innovation for their employees. In this, staff members need to feel comfortable and relax where they can perform great work to attain set goals (Taneja, et. al., 2016). Along with this, innovation strategy should highlights how innovation will help in developing value for desired clients and how an organization will capture the whole share which is beneficial. It is important for Philips is to focus on maintaining culture and create a sound environment where all the employees properly perform their tasks. If company managers need to change the culture of innovation so they should conduct a meeting where they should discuss modifications in innovation with their staff members (Tronina, et. al., 2020). After evaluating their opinions, managers should make decisions that must be beneficial and suitable for both employees and the organization.
Application of concepts and theories to analyze the selected case
The concepts and theories which are used in theoretical backgrounds include innovation strategy and innovation as a process. These help manage business operations and create new ideas of innovation that assist in improving the growth of a company.
In this, innovation strategy is playing an important and major role in how goods have been developed within an organization. An innovation strategy is such a plan which is used by Philips to motivate advancement and success in the latest technology or facilities. This will provides help to Philips in improving the systematic services of Philips products and services (Williams, 2016). Such activities and functions are managed by investing the required amount of money in the research and development process. Along with this, it is essential for a firm that needs to gain competitive advantages. Philips can use the innovation strategy for growing its business operations in the large market place (Souto, 2015). It is a plan and action which is used to grow the market share and income with the help of a variety of goods or services. When it comes to building and preparing the solution, such a strategy must demonstrate whether product improvement and disruptive or innovation are considered as the best method for a company. In Philips, innovation, and creativity main aspects that lead the business towards higher success. For a company, innovation is crucial to the advancement of the community as it is used in solving such types of social platforms and increasing society’s ability to act (Clauss & Spieth, 2016). It is accountable for solving major issues and problems in a sustainable method along with the latest technology.
Along with this, the Innovation process theory is the theory which deals with the increase of innovation in the various organizations with all measures and provides benefits for the company. Philips electronics is a large organization which deals in electronic products and services for their customers and other stakeholders (Ergunova, et. al., 2017). The company can use the application of the innovation strategy concept will be beneficial for the company’s sales and profits. Innovation is a medium that is highly applicable in the Philips electronics company where the products and services are required to be attractive for the consumers to buy them. The old technology used for the invention of the electronic products will not increase the demand for the products and services for the customers (Seijger, et. al., 2019). The innovation in the production of the electronic products of Philips Company is greatly used for attracting customers and increasing sales to enhancing the benefits of the company.
The innovative products and services stand out in the crowd of competition in the market place. The innovation process is applied in the Philips electronics company for various reasons. The innovative products are highly demanded in the market (Secundo, et. al., 2019). The customers are attracted to the latest technology products and services offered by the company of electronics (Fischer, et. al., 2020). The innovative products by Philips electronics company offer a wide range of benefits for the customers like the low price, low electricity consumption, higher durability, higher reliability, one year warranty, etc. these innovation perks attract a wide range of customers which provides benefits for the company and increases the sales. The innovation strategy theory also helps in the enhancement of business in the market (Hammarfjord & Roxenhall, 2017). The competition in the market place can be won with the application of innovation management theory in Philips Electronics Company. The innovation strategy theory has various kinds of innovation such as incremental, architectural, disruptive, and radical. These types of innovation help the companies to innovate the various levels of the company to gain more benefits from the market place.
The innovation strategy theory not only helps the company in dealing with the increase in sales or having benefits but also helps in the overall innovation of the management of the company. The innovation strategy theory provides a wide range of opportunities for the company to innovate the management and services of the company to gain more benefits and perks from business activities (Kalay & Gary, 2015). The innovation in the products and services will impress the customers about the services and quality products offered by Philips Company and the customers will act as the mobile marketing setup for the company. This will benefit the company in a great manner where the sales will increase, the popularity of the brand name will enhance and the market share of the company will also increase. The innovation strategy theory is highly applicable in the Philips electronics company and provides a competitive advantage in the market place (Prajogo, 2016). This theory is highly used in the companies for creating advantages for the company and provides innovative services and products for the customers of the company.
Another concept is the innovation process which describes the direction of translating new and current skills in marketing solutions. Philips requires convincing the successful innovation procedure which has decided to take corrective actions and steps for increasing growth (Kasemsap, 2017). The innovation as a process is that concept which helps in analyzing different stages to carry out the business operations and its functions. Various steps in the innovation process involve idea generation, screening, experimentation, commercialization, and implementation. The innovation process helps Philips to understand the ideas and generate after evaluating it properly and also execute the ideas on business activities. Besides this, an organization needs to evaluate and understand each stage and applied in Philips process for effective operations (Keshta, et. al., 2020). The successful development of new thoughts and ideas is essential to the respective company and it can improve their business procedures, carry out new ideas and improvement of goods or services, enhancing its efficiency, and improving its profitability.
The innovation process theory focuses on the enhancement of efficiency in capturing feedback of customers to mitigate the waste in the product development cycle. The innovation process theory is very helpful in the process for prioritizing of the experimentation in the elaboration of the planning, and incremental improvement and celebration for the process (Mashahadi, et. al., 2016). Innovation management is very important for the process of product development and highly applicable in Philips electronics where the management of the company can deal with the direct application of the feedback provided by the customers in the account of the product development cycle. The innovation theory is applicable in Philips Electronics Company which is required for the help in the mitigation of waste in the whole process of the product development cycle in which the products for the electronic material are developed. The feedback from the customers is collected to help the management of the company in the process of delivering of products and services to the customers and gain feedback for the process of product development and reducing the waste products in the product development cycle (Masucci, et. al., 2020). This theory is very important and applied to the Philips electronics company to deal with the management of the company and increases the demand for the products and services of the company which works n the direction of helping of the environment by reducing the waste in the whole process of production of the products (Paschen, et. al., 2020). The innovation process is a kind of approach which is used for managing the organization for supporting the consistent enhancement in the concept of improvement for the long term approach for the working of the organization for the systematic system to achieve a small and incremental change of the process to enhance the efficiency and quality of the products and services offered for the customers of the company.
This is very helpful and effective for the increase of the sales and competitive advantage in the market place of the company to provide innovative services and products to the customers. Lean management is followed in the five major principles of innovation management which works for the innovation of the products and services of the company (Ozkan-Canbolat, et. al., 2016). The innovation process theory works on defining value, creating flow, mapping value stream, using a pull system, and pursuing perfection for the development of products for the Philips electronics company in the market place (Oh, et. al., 2015). The innovation theory is applicable for the process of the gathering of feedback for the process of the product development cycle to reduce waste production from the development of product and services for the company to deal with the various kinds of benefits for the process of the innovation and technology and other advantages of the products and services. The innovation process theory applies to the process of getting a reduction in waste products from the product developmental cycle (Oshri, et. al., 2015). The various kinds of values of process innovation are applied for gaining attention and increasing sales of products and services from Philips electronics company.
Conclusion
From the above described easy, it has been concluded that strategic innovation is important in every organization as this will help in improving the creative skills and abilities of their employees. With the help of innovative ideas, Philips can enhance the growth of the company and reach desired customers. By developing innovative products, there is a possibility to increase the number of customers range towards firm products or services. The essay describes the power the innovation and how this will be used in an organization to higher growth levels. Innovation is essential for every company as this helps the business in surviving in the tough competitive world and business requires being capable of using that technology along with innovative concepts. Such companies are growing and gain goodwill which concentrates on changing the business environment and perform the function as per the current situation. Strategy development is one of the major factors for Philips that assists in increasing the chance of attracting potential clients.
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