Discuss about the Entrepreneurship and Innovation of Social Capital.
Mobile system can necessarily be regarded as an innovative process of business since this is essentially altering the entire environment of payment. The Company Pay Wave is said to introduce an innovative product of mobile payment solution.
In this regard, it can be hereby said that the current innovative project of mobile payment solution of the firm Pay Wave has the following objective:
Delivering customers specific opportunity of a seamless system of payment for enhanced payment experience (Mcguinness et al., 2017)
Generating ease of making payments (sometimes recurring payments) that can incentivize different customers to disburse and generate potential for enhancing volume of sales.
Plastic system of payment can be considered to be a significant problem for years. Nowadays people make payments using plastic majority of the time. However, for various small business enterprises, intricate hardware establishments, pricey contracts as well as support networks for supporting credit cards can be said to be an impossible solution (Shaikh et al., 2017).
Pay Wave, the company delivering innovative mobile payment solution can help in mobile money transaction. The sale processes are expected to receive contactless mechanism of payment.
The new payment solution by the company Pay Wave is said to cover specific areas that ca bring about wide array of different economic benefits. It is expected to lessen fraudulent activities, lower transaction cost by utilizing the system (Hamza & Shah, 2014).
The current business of Pay Wave intends to provide system of mobile payment for particularly urban transit. Particularly, mobile can be considered to be the preferred system of making payments for mainly urban transits such as for cases like ticketing in buses, gathering at different toll, different metro transit can also use system of mobile payment (Liébana-Cabanillas et al., 2015). There are diverse commuters that prefer mobile system of payment for business transactions in a simple manner. Therefore, this project can be considered to be an important area for specifically mobile system of payment that can be collectively discovered by mobile payment service, different banks along with other civic bodies.
In addition to this, the project is expected to deliver seamless payment experience by way of triangulating requisite information collected from multiple points of data that can assist in development process of algorithms. This can help in containing overall level of risks along with different pre-empt financial scams (Abulafia & Cohen, 2016). Essentially, this can aid in developing consumers together with merchant trusts in the whole system. Particularly, this project founded on different data on transaction, different consumers along with merchants can be appropriately profiled as well as rated. In addition to this, the new entrepreneurial opportunity of the company Pay Wave is also expected to be cost effective and at the same time scalable. In essence, this mobile based system of payment delivered by Pay Wave has the intention to develop so that hardware along with service cost can be diminished to zero. Also, this can help in augmenting whole procedure for the purpose of upholding self-on boarding by different merchants to reduce the costs and fund out revenue streams instead of concentrating on specific business transactions.
The development of the new product plays a key role in the growth of the business and it is seen that the company looks to make use of the most suitable model with the help of which the understanding of the product can be attained and accordingly the product can be introduced in the economy (Goodall et al., 2017). There are three frameworks that are available for use and it is seen that New Product Development (NPD) process has been used in order to develop the product that is desired by Paywave Company Ltd.
This model comprises of three phases and the first phase is related to Ideation, which involves the initial creation of the concept and screening of the same. This is done in order to have an understanding of the viability and the effectiveness of the new product.
The next phase consists of Development and in this phase the first step involves the preliminary technical assessment. This is helpful in generation of the technical analysis with the help of which the techniques and the tools that would be used for the purpose of the development of the product can be understood. In the same manner, the market is assessed preliminarily in order to have an understanding about the fact how the market would respond to the product that would be incorporated and the changes that have been taking place in the market (Mittal, & Kumar 2018). The next step in the phase is the preliminary production assessment and this done in order to have an understanding of how the product is effective and is able to satisfy the market. The production analysis is undertaken by having an understanding of the market feasibility so that accordingly the product can be developed in an effective manner.
The third and the last phase associates with the production phase. It is seen that product development is undertaken by taking assistance of the in-house product examining prototype (King, 2018). The success rate of these assessments leads to the development of the field trails with the help of which the effectiveness and the demand of the product in the market can be understood.
An independent and technical review is done in order to create an understanding of the effectiveness of the product and the technology that has been used and thereafter the production process can be undertaken. The product that will be delivered will be reviewed from the customers with the help of which the effectiveness of the product can be understood and accordingly improvements in the product can be initiated.
The readiness of the company with respect to the incorporation of the technological innovation and this can be understood with the help of the Innovation Diamond Model. This model comprises of four indices and these indices are used in order to assess the degree to which a company is ready for managing the technological innovation (Suseno, 2018). The market index is one of the four indices that looks to assess the extent to which one can access the market and gain understanding of the needs of the customers and accordingly pricing the strategy. This is done with the help of certain questions. The next index is associated with innovation index that looks to assess the engineering, technical and technical problems in order to introduce the new product from the sample to the actual process of production. The strategy index looks to examine the planning of the business, alliance partnering strategically and the maintenance of corporate governance. The final index associates with the resource index, which is related to the human resource, resources related to capital equipment and the measures that would be taken in order to create effective innovation (Kumar et al., 2017). In this manner, the product that is developed by Paywave Company Ltd and is strongly related to the innovation index as the product is looking to take care of the engineering, technical and social issues and thereafter creating the product that would be efficient and the company would be able to handle the innovations.
In order to make an analysis of associated risk and return of the concerned innovation the rent model is used. Economic rent is defined as the ability to get a high return from exploiting a scarce resources like innovation conducted by a firm. The three important aspect to be considered in computing economic rent are sales volume over a period of time, the length or duration of exploiting the innovation and the profit margin associated with the incorporated technology.
Figure 1: Rent model
The amount of rent is the product of volume, rent and length. The aspects related with volume are potential market adoption rate, potential sales volume and diffusion in market segment.
Based on the different indicators of volume the, the volume scores is obtained as
4 + 3+ 3 = 10 (High)
The aspects related to rate include potential rate of gross profit, potential rate of net profit and nature of innovation
Estimated rates score = (3 + 2 + 3) = 10 (High)
The important aspects for length are technical base of the innovation and related technical and legal view.
Estimated length score = (4+4+4) = 16 (High)
Based on the scores of the component of rent the outcome is mapped as follows
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Champion |
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— |
++ |
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Volume |
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Rate |
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Length |
A score is rated as high if it is greater than 7 and is low if less than 7. Based on the computed score, all the three dimension is estimated to have a high score. The primary focus of the innovation thus should be external.
The commercialization of the technological innovation associates with several elements and each one of them has been explained as follows:
The company is looking to address the readiness of the market in order to have an understanding of the product being effective in the market. The demand and the requirement of the end user is required in order to construct the product. The operations of the players is even required to be understood so that effective idea can be attained. The market price gaps needs to be assessed so that the effectiveness of the new product can be understood in an effective manner.
This is understood with the capability to understand the technologies that are disruptive from various kinds of innovations. The company needs to address the importance of the technology and thereafter look for a market where the innovation can be incorporated (Akram, 2017). The responsibility of the innovation in the independent and small companies can be understood so that responsibility can be distributed in that manner. In this manner the disruptive companies can be keep free and accordingly the results can be attained.
These tests are vital for the development of the new opportunities of the new customers and it is seen that alternative technologies needs to be created and accordingly discover the radical innovation for the customers. These aspects would be helpful in targeting the radical innovation towards the customers who are ready to welcome a single line product.
The issues that are existent with the market implementation of the radical technological innovation associates with the fact that the customer are unable to assess the technology on a frequent manner, generally have little experience to make a comparison of the same and create a solution. It is even seen that there is an existent of extensive problems when these technologies are incorporated in the larger companies and thereby addressing the fact that commercialization of the technologies have advantages and limitations.
As per reports, the use of the smart phone has increased by nearly 394%. Also, research studies indicate that 91% of adults also have the smart phones within their own reach every day. Similarly, this project of mobile payment solution by Pay Wave is said to have immense impact on the business success (Ran, 2016). The radical change in the process of business due to the innovative product of mobile payment solution that is the digitalised payment system can exert favourable influence on the overall business of Pay Wave.
The table below shows impact of the innovative product on augmented revenue reflecting level of business success:
|
Year |
Annual Transactions (revenue of the mobile payment solution provider in ‘000’) |
|
2018 |
450 |
|
2019 |
620 |
|
2020 |
780 |
|
2021 |
930 |
|
2022 |
1080 |
The innovative plan of the specific project is expected to have immense impact on the overall success of the business. As the smart phone users have also increased in the entire world and the plastic payment systems also prove to be problematic, it can thus be inferred that this solution is said to augment the revenue of the firm Pay Wave by higher flocking customers towards this system.
Conclusion
The introduction of the innovative application “Pay Wave” has a potential benefit for the organization. On internal ground, the volume, rate and length scores happen to be high yielding possibility of high rent. The organization needs to focus on external environment with a well-structured strategic plan.
Reference list
Abulafia, D., & Cohen, E. (2016). U.S. Patent No. 9,269,010. Washington, DC: U.S. Patent and Trademark Office.
Akram, W. (2017). Challenges and Opportunities experienced in moving from Cash to Cashless Economy. International Journal of Current Trends in Science and Technology, 7(8).
Goodall, W., Dovey, T., Bornstein, J., & Bonthron, B. (2017). The rise of mobility as a service. Deloitte Rev, 20, 112-129.
Hamza, A., & Shah, A. (2014). Gender and mobile payment system adoption among students of tertiary institutions in Nigeria. International Journal of Computer and Information Technology, 3(1), 13-20.
Kumar, H., Mustafa, S. Z., & Gupta, S. (2017). 3Smart People for Smart Cities: A Behavioral Framework for Personality and Roles. In Advances in Smart Cities (pp. 35-42). Chapman and Hall/CRC.
Liébana-Cabanillas, F., Ramos de Luna, I., & Montoro-Ríos, F. J. (2015). User behaviour in QR mobile payment system: the QR Payment Acceptance Model. Technology Analysis & Strategic Management, 27(9), 1031-1049.
Mcguinness, B., Ezell, D., Jannarone, P., Vlugt, E., & Roach, M. T. (2017). U.S. Patent Application No. 15/604,927.
Mittal, S., & Kumar, V. (2018). Adoption of Mobile Wallets in India: An Analysis. IUP Journal of Information Technology, 14(1).King, D. L. (2018). Why Stay on Top of Technology Trends?. Library Technology Reports, 54(2), 6-2.
Ran, A. S. (2016). U.S. Patent No. 9,262,755. Washington, DC: U.S. Patent and Trademark Office.
Shaikh, A. A., Hanafizadeh, P., & Karjaluoto, H. (2017). Mobile Banking and Payment System: A Conceptual Standpoint. International Journal of E-Business Research, 13.
Suseno, Y. (2018). Disruptive innovation and the creation of social capital in Indonesia’s urban communities. Asia Pacific Business Review, 24(2), 174-195.
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