Welcome to the World of Business and its Functions

Understanding Business Functions Course Code: B202 P2

6 October October October 2016B202 Part 1 Session 13 Block Details There are three blocks in: B202 Part 2 Block 4: Innovation Block 5: Performance Block 6: Conclusion: Taking Stock

INNOVATION

Introduction Innovation: some thing new has been introduced for the first time. Innovation: some thing new has been introduced for the first time. Invention: some thing made for the first time Invention: some thing made for the first time Sometimes both are interchangeably used Sometimes both are interchangeably used

Inventions use new knowledge to create something new. Inventions use new knowledge to create something new. Inventions are useful if they have the potential to enable people to do things in different and better ways. Inventions are useful if they have the potential to enable people to do things in different and better ways. Example: wheel; bicycle; cars, motor cars; buses; trains. Example: wheel; bicycle; cars, motor cars; buses; trains.

Inventions can also have negative effects, for example pollution as a result of emissions from motor cars. Inventions can also have negative effects, for example pollution as a result of emissions from motor cars. Invention can benefit an organization if it reduces costs, increases the effectiveness of product or service provision. Invention can benefit an organization if it reduces costs, increases the effectiveness of product or service provision. Enable an organization to supply customers with new products & services. Enable an organization to supply customers with new products & services. Very important: not all inventions lead to innovation. Very important: not all inventions lead to innovation.

What ’ s so great about innovation What is the problem to which this technology is a solution? What is the problem to which this technology is a solution? Whose problem is it? (the problem may not be most people ’ s problem) Whose problem is it? (the problem may not be most people ’ s problem) Who may be harmed by the technology? (losers as well as winners) Who may be harmed by the technology? (losers as well as winners)

Four types of Innovation Incremental (building on existing products ) Incremental (building on existing products ) Discontinuous / Radical ( which destroys the existing products & sets product development onto a new trajectory) Discontinuous / Radical ( which destroys the existing products & sets product development onto a new trajectory) Architectural (links existing technology in novel ways) Architectural (links existing technology in novel ways) Modular (destroy some parts of an organization ’ s component knowledge but leads to architectural innovation) Modular (destroy some parts of an organization ’ s component knowledge but leads to architectural innovation)

Innovation & organizational performance Resources, capabilities & competencies are Prerequisite for performance Resources, capabilities & competencies are Prerequisite for performance  Resources: are input into organizational processes (Tangible, Intangible, Human)  Capabilities: strengths in managing & performing particular types of activity for example an organization may be especially good at knowledge creation through a particular approach to human resource management.

 Competencies: strengths in managing activities & performance group of activities & the interdependent on them

The innovation process  Linear: the main advantage of it to new product development are low risk & efficient resource usage.  Non linear: we should assume that most systems do not & should not fit linear models.

The impact of Innovation on Business Functions

The Accounting “ economics ” of Innovation  Quantitative model ( a method of gathering data, performing calculations & interpreting the answer)  Organizational environment capital Investment model capital Investment model ID of potential investment Project definition Analysis & Acceptance Implementation Monitoring & post audit Strategic planning Organizational personnel Feedback

 Investing in IT  Investing in Advance Manufacturing Technology (AMT) Difficult to quantify financially:  The quality & design of products  The consistency of product specifications  The delivery times to customers  Ability to meet customer specifications  The flexibility of production

 Innovation and operation  Innovation and Human Resource Affected by innovation in two ways Affected by innovation in two ways 1- to the application of flexible working practices within the organization 2- suggest “ 1 ” is encourage the generation of new ideas from all employees across the org. or whether this related to improved working practices or operations or to the generation of ideas for new products, markets and related activities.  The importance of knowledge to innovation

Innovation and Marketing  Direct marketing  E-commerce  Innovation & Information Management  Brands  Values

The formalities of protecting your Intellectual Property (IP)  Patents  Copyright  Trademarks  Registered / Unregistered design