Is Innovation the Same as Technological Advances - Assignment Example

Contents Contents 1 Question I: 1 Question II: 4 Question III: 8 References 12 Question I: “Innovation is the same as technological advances.” Do you agree or disagree with this statement? Use course readings and at least two case examples to support you answer. Innovation is a set of processes that start with an invention. When the invention proceeds further towards development it results in a new product or a service ready for introduction in the relevant market (Edwards and Gordon, 1984). On the other hand, technological advancement is the further development on a previously existing technology. It can be said that the core concept on which technology can be founded is introduced by innovation. History is replete with facts that have highlighted the power of innovative mind to trigger inquisitiveness that have led to technological advancements. To say that innovation is the same as technological advancement would not be a correct relationship since the former drives the latter. Both are independent of each other and yet both are interdependent. Innovation is how a thing is done, how an idea is germinated and how it is implemented; technology - both in social and physical worlds - involves practical application of science. What precedes technology is innovation. Innovation is an idea which finds practical application in or through technology. When the two combine, it normally results in a technological advancement. The two words are intertwined with each other, and it is also seen that one can give rise to another - even a technological advancement can lead to an innovation. If technology is put to a traditional use differently, it can give rise to an innovation. But here that shifts the context of question altogether so can be left there. Innovation has the capability to drive new markets; higher the understanding of processes and demands from the market, better will be innovations. Innovations can create new opportunities which are affordable, easier, quicker and safer. Technological advancements act as carriers to such innovations and thus result in widespread and far-off dissemination of the innovation (Sull, Gossi & Escobari, 2003). In order to establish the relationship between innovation and technological advancement further, the case of telephone can be taken. Telephone is normally related to Alexander Graham Bell, who is said to have "invented" it. Innocenzo Manzetti, the first person to have given the "idea" of any such instrument that will help two people talk long distance goes often unmentioned. Soon after Manzetti mooted this idea, both entrepreneurs and scientists got to work on it until after 30 years Bell gave the world what is now known as his invention. Clearly innovation was followed by technology. Further technological advancements saw this invention take different forms through more than a century and a half until a time when cell phones replaced landline telephones. The rapidity with which cellular technology is now advancing, another 30 years later the world might be using what could be in just the concept mode only as of now. Innovative ideas when followed by technological knowhow and advancement turn concepts into realities. More often than not innovation and technology are used together. This is truer when competitive advantage is discussed. So as not to muddle the meanings of both it is advantageous to understand that they complement each other. Rawness of an innovative idea is put to finer use by the advancement of technology. However, it is wrong to presume that if there is no idea, there would be no technological advancement. Sometimes it is the technology itself that leads and even gives rise to new ideas. As said above, both even though independent of each other are interdependent in their application. Brilliant innovators always have technology in mind when they start thinking of new innovations. The iPhone series by Apple is one such recent development in the scientific world that has led us to believe that there are infinite possibilities to a small, finite idea. For example, iPhone 5 is packed up such features as gesture based controls and wireless charging, and those would, a few years before, have been just a figment of imagination of scientists at Apple. Similar breakthroughs can be seen in internet technologies which have progressed like anything through the last decade-and-a-half. Desktop applications, which were once the darling of masses, are today passé; thanks to the high-speed network connections driven by high-end fibre optic technology. Looking back at the Web, what it was 10 years ago is totally obsolete now. These are all innovations that have been made possible by high-speed connectivity, efficient hardware and software evolving almost every day. Technological advancements have enabled developers, designers and programmers implement ideas with as much ease as creating them. If innovation and technological advancements are to be analysed together, both result on account of human inquisitiveness and need for further development, which wants to explore interconnected elements on this earth that keep or are in need of continual change. The change could be either by design or by natural emergence; but the intention of the change is to generate value in a social setting where human beings want to make their sustenance better, easier and comfortable. Question II: “What an entrepreneur needs to be successful is not luck but great technology and good ideas. When pitching to venture capitalists it is important that you demonstrate how exciting the innovation is.” Required: Do you agree or disagree with that this statement on what an entrepreneur needs to be successful? Justify your answer by using concepts and models covered in the course? In what way is this statement consistent or not consistent with how your group approached the business planning assignment? “Opportunity knocks at the door of a prepared mind”, so goes the saying. And successful entrepreneurs always have the uncanny aptitude to recognize the opportunity at the right time (Drucker, 1986); irrespective of which way their luck might actually want them to take. Circumstantially, things as chance, luck and serendipity may be correct, but what matters for entrepreneurs in reality is their keen eye for detail and alertness to their business surroundings to take correct decisions. In present times good and innovative ideas along with technology are seen as two factors that help entrepreneurs succeed. When entrepreneurs walk on their innovative ideas and hold technology as their frontrunner, they unlock their potential to grow. Technology does not only keep an entrepreneurs ahead of his competitor, it also helps him analyse markets and costs, and streamline other important resources like manpower. Both good ideas and technology help an entrepreneur transform himself from a caterpillar to butterfly (Timmons & Spinelli, 2004). If backed by the sound knowledge and strategic planning the making of the butterfly is a set of diligent processes that unleash the inherent power in an entrepreneur to be successful. For an entrepreneur an idea itself is the opportunity, which has the quality of being durable, attractive, and timely. The "window of this opportunity" stays open for long enough (Collins & Lazier, 1995). If amalgamated with the right kind of technology, it can do wonders. In this regard no other example could be as good as that of Mark Zuckerberg's Facebook. A small, innovative idea that shook the world of social marketing. Mark Zuckerberg may or may not have been lucky, what he did, however, was use technology in the most innovative, intelligent and efficient manner. Technology has shown entrepreneurs the way how to do business without actually making huge investments. It has offered these entrepreneurs many different options in the online world to either sell their products or market the same to interested parties. One important cliché that technology has offered entrepreneurs is that it can help project themselves more prestigious and much larger than what they actually are. This, for example, begins with creating a high quality and high impact website. This can be done by using compelling images, text and concepts and creating a brand image which instantly put an entrepreneur’s venture on a pedestal a cut above the rest. Another important role that technology plays in making an entrepreneur successful is by offering him the option to create storefronts almost anywhere that he want in a virtual manner. Customers can be vowed and created anywhere that one want and it is a matter of few innovative ideas to reach out to a global audience for an entrepreneurial venture. Companies like Yahoo, Ebay, and Amazon, which cater to the global customer base through their online ordering system, have demonstrated the power of technology to grow businesses and rake in sales. Use of technology has showcased the limitlessness of possibilities entrepreneurship can take - all without having warehouses, thus eliminating the need for making huge investments before succeeding in a venture. Clearly, technology is the main driver in entrepreneurship today, and as technology grows and undergoes changes, businesses undergo changes proportionately. Furthermore given the untapped opportunities that the technology possesses, entrepreneurship can ride the bandwagon of these opportunities for long without the fear of exhausting them The scope of success through expansion are great. That apart, when it is juxtaposed with a good idea, the two offer powerful tool to the entrepreneur to succeed. Stumbling upon or innovating a good idea help an entrepreneur create opportunity from creativity. It must be born in mind that it needs a number of iterations, based on trial-and-error method, for an idea to be turned into a concept that forms the cornerstone of a successful venture. A case in point can be that of Howard Head; it is after making around 40 metal skis that he finally made one that worked well and became the source of his success. Apparently, the dynamics of a business is changed when technology is introduced into the same. For example when information systems are linked the dynamics of a local business environment changes into a global one; the implications of success are far-reaching as the reach extends beyond the nativity of an entrepreneurial venture. These scenarios present businesses with new, untapped opportunities, impossible to tap in absence of technological integration. This also has cost-factor implications since communication is more technology than human dependent. This also lends entrepreneurs the flexibility to venture into uncharted and undiscovered territory; this further changes the business dynamics since new opportunities emerge and old ones undergo rapid changes. Joseph Schumpeter, a Harvard professor, has argued that innovation is the key to entrepreneurial success. The innovation could be anywhere in the business process so as to create value for the end user. Consequently, successful entrepreneur is the one who is talented, creative, full of innovative ideas and tech-savvy, and who knows which resources must be utilised when and how in order to give the entrepreneurial unit boost to succeed (Online, n.d.). Question III: What is the value innovation concept? How can an organisation formulate its innovation strategy using the value innovation concept? Provide an illustration of how it could be used. Use a Value Curve and an ERRC analysis to support your answer. Value innovation is a means to bypass competition by exploring new ways of thinking and using strategy that sort of offsets competition-based strategy. This is termed as value-cost trade-off. Value innovation is based on two different thoughts; one that creates greater value for customers by reducing cost and another that creates the same value by increasing the cost. Companies that steer clear of competition lower costs and provide reasonable value to the customers. In all, whichever strategy does the company go in for depends on whether they want to reduce or increase cost. Value innovation is normally implemented through what is known as lean strategy transformation and the bottom-line is to create new products or services differently than what competitors do. Two well-know management gurus Renee Mauborgne and W. Chin Kim use two metaphors for explaining this: red oceans and blue oceans (Kim & Mauborgne, 2000). Organisations that do not ride the wings of innovation but keep working on the existing line of products, strategy or thought keep their competition afloat, which makes their existing difficult in a stiff marketplace. But if organisations innovate and create products or services that identify and enter the consumer needs previously unfulfilled create a niche segment of their own, with which demand comes naturally, and thus get freedom from competition. This, according to these gurus, is blue ocean. When a sound strategy back blue ocean, which primarily is shouldered on reasonability of cost and prices, it results in perfect value innovation. Certain things help companies make distinct differentiation between Red Ocean and blue ocean strategies. For the former existing marketplace is the competitive turf, for the latter the turf is exclusive. The former develops strategy to beat the competition, the latter makes it redundant. The former exploits existing resources, customers and demand; the latter create a new segment on its own. Analysts have argued that in order to implement value innovation successfully customer have to be treated more as stakeholders than mere consumers. The intention must not be to sell only but also help customers be more successful and happy by reinventing businesses. It is a question of how differently the strategy would be developed and then implemented. Since doing things differently needs innovation that also calls for some investments which companies must be ready to make. Companies that indulge in value innovation concepts tend to bank on their people as their strength; since customer begin to find value in these companies, they also become another segment of support system. The focus becomes customers, capabilities, and innovation, which is a sort of paradigm shift from the conventional modes of business which eye profits more than anything else. Value innovation calls for the need to lead a low-margin growth, protect high market share and make efforts to sustain differentiation (Christensen & Raynor, 2003). There are many different ways of finding value innovation opportunities. One of them is popularly known as voice-of-the-customer assessments and innovation curves. The latter is a graphical method of showing how a company does or can offer value to its customers. The curve typically includes what competitors offer in a given segment and what could be the key success factors in that segment which, if tapped using value innovation, can help the company reap maximum benefits. Value innovation curves are an effective tool to determine opportunities for any product and identify the need to eliminate, improve, reduce or create further value in the same product. In order to steer clear growth through value innovation companies develop number of value innovation curves considering varied options so as to narrow down on the actual need to improve and innovate. However, it is normally held that formulating a value innovative strategy is not as easier as is thought. Scholars have opined that it is often a challenge and much more difficult than idea management, idea generation and inventive problem solving. There is always a flip side to creating and implementing value innovation since what is best in terms of value to customers might not necessarily be in the interest of company's existing services or products (Ulwick, 2002). To establish the balance is the most tedious task. Since customer participation is an important part in devising and implementing a value innovative concept, it is often too dicey to take assessments drawn from such observation on face value. This is probably one reason why around 70 percent of value innovative concepts either fail after they are implemented or are abandoned before they actually take off. Only around 80 percent of all those who succeed finally offer what they had envisioned for or promised the customers. Despite the pitfalls two important stages in value innovation have been deemed as the most crucial ones. These are the strategy stage and the execution stage. Companies need to deliberate upon crucial decisive factors before developing the strategy, and once the strategy is developed the execution has to be charted out in a very systematic manner. Below is an example of a cellular provider’s value curve. Another image explains the ERRC (eliminate, reduce, raise, create) grid. This is also known as four actions framework, which is a precursor to a value curve. References Ulwick, A. W. (2002). “Turn Customer Input into Innovation”, Harvard Business Review, Jan. 2002. USA. Answers.com (n.d.). Entrepreneurship: Gale Encyclopedia of Small Business: Entrepreneurship. Available http://www.answers.com/topic/entrepreneurship-1. Accessed June 04, 2012 Christensen C. M., Raynor M.E. (2003). The Innovator's Solution: Creating and Sustaining Successful Growth, Harvard Business School Publishing Corporation. USA. Collins, J. C. and Lazier, W.C. (1995).. Beyond Entrepreneurship: Turning Your Business into an Enduring Great Company. Prentice Hall, 1995. Drucker, P. F. (1986). Innovation and Entrepreneurship: Practice and Principles. Harper & Row, USA. Edwards, K. L. and Theodore J. G. (1984). Characterization of Innovations Introduced on the U.S. Market in 1982, The Futures Group, prepared for the U.S. Small Business Administration under Contract No. SBA-6050-OA82. Kim, W.C. & Mauborgne, R. (2000) Knowing a Winning Business Idea When You See One, Harvard Business Review, September-October Sull, D.N., Gossi, R.R., and Escobari, M. (2003). Innovating Around Obstacles," Strategy & Innovation, Harvard Business School Publishing, November-December Timmons, JA & Spinelli, S 2004, New venture creation : entrepreneurship for the 21st century, McGraw-Hill/Irwin. Read More