Innovation and Invention are very important terms for an organization, but both are used in different sense. This report includes the differences between innovation and invention. Innovation is applied to the oil and gas organization, i.e. Oil and Gas UK. Furthermore, it includes the application of the strategies models and framework to this oil and gas firm. At the end, the report discusses about the role of systematic risk assessment and management in the innovation and business operations. It analyzes that it is very important to follow a systematic process to reduce the risks.
In today’s competitive business world, technology is changing constantly. Currently, enhancements are created in the technology for new inventions and innovations in each area of life. Both the terms innovation and invention are similar in many senses, but there are some differences between innovation and invention (Bessant, & Tidd, 2015). The differences between invention and innovation are given below;
Strategic innovation is the concept and creative process, which bring development ideas to carry forward business towards development and growth. Whereas, innovation is associated with creating new products.
Innovation is the process of implementation of new and practical ideas in current process, while the invention includes the implementation of new opinions, works and ideas on theory.
In invention, there is a need of scientific skills, whereas innovation requires different skills, like; strategic, marketing and technical skills and knowledge.
Moreover, invention is emphasized on a single product and process, but innovation is focused on arrangement of different products and processes (Costa-Campi, García-Quevedo, and Trujillo-Baute, 2015).
In an organization, invention is limited to the Research and Development (R&D) department, while innovation is concerned with all the departments of an organization.
In today’s global economy, energy sector plays a significant role. The cost and prices of oil and gas are affective the world’s economy. The organization, which is taken into consideration, is Oil and Gas UK. This organization is confronting many challenges from last 3 to 4 years. The company is implementing new and advanced technologies to overcome the challenges and complexities in the business operations (Drucker, 2014). So, the company needs innovation in the activities, business operations and technology to eliminate the problems in short period. For the organization, it is not possible to remove all the barriers, which exist in the business, thus there is need of long term planning. Innovative technology and innovative management will assist Oil & Gas UK in developing more opportunities for the growth and success of organizational business. Innovation in this industry is not only focused on the enhancing its business operations but also emphasized on providing safety and security to its employees and people (Dawson & Andriopoulos, 2014). The application of innovation in this industry can be understood by following points;
In oil and gas industry, the innovation can be implemented by ensuring its asset integrity and reliability. Asset integrity includes all the assets, which the organizations can use to perform safely and effectively. The Oil and Gas UK is facing challenges in managing the assets in local and international market. The assets of the organization can be fragmented into two categories, i.e. maintenance and repairing issues and material related issues. The organization can apply innovation in the processes by developing innovative ways in the material, which is used in the process of production (Oil & Gas UK, 2017). With this management must develop some innovative ways to monitor the integrity of the resources and materials.
In this competitive business environment, the organization can grow by developing an innovative and effective work culture. In the oil and gas industry, there is need of talented and skilful human resources for the business operations. If there will be an innovative culture in the organization, then it will be beneficial for it to get high profile deals. This is the reasons that the organization should create an innovative culture before implementing innovative practices.
Furthermore, innovation also depends on collaboration with the smart and talented people. Generally, it is said that innovative companies communicate and partner with other organizations before applying innovation. In the perspective sector, Oil and Gas UK has collaboration with some of the suppliers and partners to stay innovative and competitive among competitors (Pritchard and PMP, 2014).
As innovation, the organization can establish new policies and guidelines to create the ways for management. Moreover, it requires applying the Full Life Cycle Design policies for maximization of the life of assets. The company should implement the process of controlling uselessness will help in managing this component in an effective manner. To deal with this issue, the Oil and Gas organization can use upgraded out-dated subsea control system, which will assist the organization to control the uselessness.
Thus, these are the innovative practices, which can be used by any oil and gas organization to avoid the challenges and issues. Company with innovative practices can have the major competitive advantage in oil and gas industry.
There are so many models of innovation, which can be used by the organizations in implementing new and innovative practices. The growth and success of an organization does not depend on only one model. The organizations can use different models like; First and Second generation model, Third generation model, Fourth generation model, Fifth generation model and Sixth generation model. These models have different structure for implementing innovation in organizations (Foss and Saebi, 2015). All the models are used for developing new ideas at the workplace. Technology innovation can be applied by the re-engineering, manufacturing and promotional and marketing activities to get better outcomes. Third generation model is associated with the innovation by establishing connection between science and technology. Furthermore, fourth generation model of innovation is implemented by the organization for reflecting the level of functional incorporation with the organizations. Other models are used to develop open innovation in the business operations.
Apart from these models, there is a strategic innovation framework, which includes seven strategic dimensions that can be applied to any organization. There are so many organizations, which use strategic innovation framework to generate a range of results, which drive the growth and success for organization.
From the above discussion, it was analyzed that oil and gas industry organizations can implement the innovative practices by developing innovative culture and new methods and innovative systems. In this section, the model, which is applied on the oil and gas organization, is strategic innovation framework (Sengupta, 2013). This is the best and appropriate model for perspective organization. For these organizations, strategic innovations framework is the systematic process for creating effective strategies and business models for growth. It includes seven dimensions, which can be understood by following table. The table shows the application of strategic framework to the oil and gas company in this report, i.e. Oil and Gas UK. It also includes the time frame for implementing the process and strategies using this model.
|
Seven Dimensions |
Innovation Process |
Time duration |
|
1. Managed innovation process |
Oil & Gas UK is using various traditional approaches. With these approaches this organization should use some modern approaches in the business operations. By analysing and identifying its own internal capabilities and resources, the organization will be able in facilitating the relationship between external opportunities and internal competencies (Osinovskaya & Andronova, 2017). |
2 months |
|
2. Strategic Alignment |
Strategic alignment is the process of establishing link among business activities. If Oil and Gas UK implement this process, then it will assist internal and external stakeholders of organization to work on a common mission, vision and objectives (Price, Stoica & Boncella, 2013). |
5 months |
|
3. Industry Foresight |
The process of industry foresight helps the organization in understanding the current and emerging demands and trends in the industry. Oil & Gas UK organization has already implemented effective and advanced technologies. So, now the organization should make marketing research for looking some other effective methods of innovation to overcome the issues and challenges in the business operations. |
1.5 month |
|
4. Customer insight |
It is very important strategic dimension for an organization. Customer insight explains the ways for understanding the spoken and unspoken needs of current and future customers. Thus, by giving preferences to the customers, Oil & Gas UK company can attain its objective and it can improve its effectiveness and efficiency. |
6.5 months |
|
5. Core competencies and technologies |
Technologies and core competences of an organization work as its important assets. For Oil and Gas UK, the core competencies are such as; internal resources and capabilities, business competencies and physical and intellectual assets of the organization. If this organization increases and enhances its technologies and core competencies, then it will enable the Oil and Gas UK in valuing its customers more. |
7 months |
|
6. Organizational readiness |
Organizational readiness plays an important role in determining the ability of a company in the implementation of new and innovative technologies and ideas. In the case of Oil and Gas UK, it can be seen that this organization has tried to improve its technologies, but it was failed to deal with its issues and challenges. Thus, this organizations needs to implement innovation to handle and manage its financial, social, political and operational factors. |
7 months |
|
7. Disciplined implementation |
Once the organization has planned for the above strategic dimensions, then it needs to apply them in an effective and different manner. At Oil and Gas UK, the top management in the organization should keep and analyse the past records of operational and financial performance (Okpara, 2007). All the seven strategic dimensions of strategic innovation framework need to be created for helping internal and external stakeholders to act effectively and efficiently. |
10 -12 months |
(Source: Foss and Saebi, 2015)
Risk management is the process, through which an organization can analyze and evaluate the characteristics of uncertain events and developing effective plan so that it can have benefits by recognizing its business opportunities. There are different sources, which can cause risk in the organization and affect the organizational operations significantly. There are some types of risk, like; financial risk, political risk, market risk etc. The organization can use a systematic process to identify the risks and hazards in current process (Bromiley, McShane, Nair and Rustambekov, 2015).
When any organization implements innovation in business practices, there is always a risk, which is associated with the process. So, the organization needs to develop risk management to assist its innovative practices. Implementation of risk management process can enhance the ability of an organization to handle the risks at all the levels of management and operations (Haimes, 2015). The major objective of risk management is to identify the risk and then assess the risks in the organization. Furthermore, it includes developing some effective strategies for mitigating these risks. In addition, the organization can use systematic approach for managing the risks. This approach is significant in the process of decision making that must be flexible and reliable. The risk assessment and management can be understood by applying on the oil and gas company, i.e. Oil and Gas UK. The organization is using Environmental Impact Assessment, which is an important risk assessment process for organization. This organization has developed this process to make the innovation very effective (Lam, 2014). Implementing a systematic process in the risk management is very important and beneficial for the organization. For example, Oil and Gas UK Company is following some stages in systematic approach. These stages include such as; identification of risk, identification of effects, level of effects, probability and then reduction or elimination of risk. If the company skips any stage in the process, then it may be failed in the reduction or elimination of risks (Li, 2014). Thus, it is very necessary to follow all the stages of systematic risk assessment and management, if the organization wants to eliminate the associated risks of innovation.
Thus, the systematic risk management is very necessary for an organization to avoid the situation of failure. This process can assist the organizations in developing suitable processes in different areas of organizations.
Conclusion
It is hereby concluded that there are so many differences between innovation and invention. The organizations use both the terms and processes in different sense. In this report, the process of innovation is applied to Oil and Gas UK to overcome different challenges, which are faced by the organization in energy sector. The organizations can use many models and seven strategic dimensions for implementing innovations in the technologies and business operations. It will be beneficial for the organization. Furthermore, the report concludes that an organization should use systematic process for handling the associated risks.
References
Bessant, J. & Tidd, J, 2015, Innovation and Entrepreneurship. John Wiley & Sons.
Bromiley, P., McShane, M., Nair, A. and Rustambekov, E., 2015. Enterprise risk management: Review, critique, and research directions. Long range planning, 48(4), pp.265-276.
Costa-Campi, M.T., García-Quevedo, J. and Trujillo-Baute, E., 2015. Challenges for R&D and innovation in energy. Energy Policy, 83, pp.193-196.
Drucker, P, 2014, Innovation and Entrepreneurship. Routledge Publications.
Dawson, P. & Andriopoulos, C. 2014. Managing Change and Innovation, Sage Publishing,London, U.K.
Foss, N.J. and Saebi, T. eds., 2015. Business Model Innovation: The Organizational Dimension. OUP Oxford.
Haimes, Y.Y. ed., 2015. Risk modeling, assessment, and management. John Wiley & Sons.
Lam, J., 2014. Enterprise risk management: from incentives to controls. John Wiley & Sons.
Li, W., 2014. Risk assessment of power systems: models, methods, and applications. John Wiley & Sons.
Osinovskaya, I. V., & Andronova, I. V., 2017, The Role of Innovative Decisions in the Development of Oil and Gas Companies: International Journal of Energy Economics and Policy, 7(2), 346-351.
Okpara, F.O, 2007, The Value of Creativity and Innovation in entrepreneurship. Journal of Asia Entrepreneurship and Sustainability, Vol 3.
Oil & Gas UK, 2017, About Oil and Gas UK, Retrieved from https://oilandgasuk.co.uk/.
Price, D., Stoica M. & Boncella, R.J, 2013, The relationship between innovation, knowledge, and performance in family and non-family firms: an analysis of SMEs. Journal of Innovation and Entrepreneurship.
Pritchard, C.L. and PMP, P.R., 2014. Risk management: concepts and guidance. CRC Press.
Sengupta, J, 2013, Theory of Innovation: A New Paradigm of Growth. Springer Science Publications.
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