Discuss about the Strategy and Innovation.
One of the important key ideas attained from the video is that there is a significant difference among business strategies, tactics, goals, and objectives. Sometime, managers get confuse among business tactics and strategies. For example, to always be the first mover in the industry, attainment of a global strategy, and be the low cost provider are not business strategies, but these are tactics, which are used by businesses to accomplish organizational strategies (Varbanova, 2013). Another important thought developed is that nowadays businesses are considered as a modern-day war. The main reasons behind this can be related to increased competition, highly dynamic business environment, and regular changing customers’ needs and preferences (Sadler, 2003). In such a complex business environment, it becomes essential for managers to design a set of complex and flexible tactics that can lead to victor. It is also learned that a good strategy clearly provides answer to four questions including where do an organization should compete, think about unique value that a company can bring, resources and capabilities to be utilized, and sustain unique value (Cole, 2003). Strategies can be intended or realized. It is also learned that nowadays, strategy is more about what a company actually do instead of what it intends to do.
The selected organization is Abbott Risk Consulting Ltd, which would be benefited from the application of the idea got in relation to the strategic development. In order to get success in current business environment, the implementation of these ideas would be beneficial for the company. For example, the company should develop a new business strategy to attain its mission and vision such as to deliver high quality consultancy services in an efficient and effective manner (Abbott Risk Consulting Ltd, 2013). Moreover, in order to develop an effective strategy, the company should firstly identify where it will compete such as selection of an appropriate marketplace, by reducing cost, offering innovative services, and use of advance technologies (Sadler, 2003). In addition, the company should identify the unique values for customers like delivering high value consultancy services. Moreover, organizational resources and capabilities should be identified to ensure their proper utilization for planning and implementing the strategy. In last, the company should work to sustain its unique values so that competitors cannot imitate and the business can get regular benefits. For example, the company should develop its resource based capabilities like human resource capabilities so that the competitors cannot easily imitate them. Currently, the company has a management team, in which all the members have specialists in their fields (Abbott Risk Consulting Ltd, 2013). The company can develop such capabilities to attain sustainable competitive advantage through its business strategies.
It is learned from the e-learning activity that innovation is different from imitation and a successful innovation provides competitive advantage to the company over its main competitors. At the same time, it is also learned that there is also a significant difference between the terms such as invention and innovation. For example, an invention is related to find out a solution to an issue or a problem. In simple words, it can be discussed that invention is the outcome of a creative idea, while innovation refers to the process of turning invention into a business success (Al-Hakim, 2010). There are several examples of companies including Apple, Amazon, eBay, etc., which get success in today’s competitive business environment through continuous innovation. It is also ascertained that for successful innovation, three important elements including new and fresh ideas, availability of big resources and continuous advancement of technologies are required. It shows that ideas and creativity are frequently considered as essential components of a successful innovation. To consider an issue in a new and different manner is known as to be creative and an idea can be depicted as a formula for addressing the problem (Al-Hakim, 2010). It is also found that there can be several driving forces and many stakeholders behind innovation. The main stakeholders include managers, customers, employees, etc (Clegg, Kornberger, and Pitsis, 2011).
Another important element is found as availability of big resources for considering and implementing big innovation. For example, to implement a new innovative idea such as building of iTunes, iPhone, etc., Apple significantly makes huge capital investment as well as invest in other resources including human capital, technologies, equipment, and land and building. It shows that significant resources are required to ensure the long-term success of innovation (Girotra and Netessine, 2014). It is also assessed that in addition to a new idea and resources, different kind of techniques and new technologies are also required for the innovation success. Apple, Samsung, eBay, Amazon, etc. are some companies, which are technically advanced and highly invest in latest technologies that further support them to continuously innovate their products and processes.
Another view grasped from the activity is that a business model innovation also answers some questions such as who are your customers, what is their needs and preferences, how you will create revenue and how the value can be created. The business model innovation supports in developing a balance among all these requirements (Kaplan, 2012). For example, before leading an innovation, it is essential to identify who will be the target customers and what are their expectations. It is because it would support in developing a product, which will meet the customers’ expectations effectively. Moreover, innovation also supports the firm to create value elements for the firm so that customer satisfaction can be enhanced as well as revenue can be generated.
It is also learned from the activity that a business can get success in business model innovation by following four steps including invention, ideation, integration, and implementation. It is also found that business model innovation can provide sustinable competitive advantage to the company because it brings invisibale changes to the outside world that will be hard to imitate by the competitors (Girotra and Netessine, 2014). In addition, it is also learned that there are ceratin key factors that must be considered by business managers to ensure the success of a business model innovation. For example, firstly, it is essential to ensure that the business implement only one business model at a time to ensure its success. Secondaly, it is essential to make sure that the business clearly communicate the business model innovation to different stakeholders mainly to customers to reap significant benefits. Moreover, it is also necessary to consider that innovation takes time, thus management should provide enough time to make an innovation successful. Fourthly, it is also important to get management commitment because without sponsorship or management support, it would be diffcult to execute innovation successfully (Girotra and Netessine, 2013).
The selected organization is Burberry, which can benefit from the application of above ideas. Currently, Burberry is facing several challenges such as over reliance on UK market to generate revenue and British culture to produce its products, etc (Annual Report, 2014). It needs to implement a business model innovation to attain competitive advantage over competitors (Kaplan, 2012). Firstly, to execute the model, Burberry should rethink about the current business decisions related to earn revenue and manage cost and risk. The company should rethink such as what the new products offerings will be, when decisions should be made, and how value can be created for the customers to earn significant revenue. Burberry should first identify its target market and know about their product expectations as it would be helpful to design a new product as well as add new value elements to improve customer satisfaction.
In addition, Burberry should encourage its employees to bring new ideas to improve the business and test those ideas to lead a successful innovation. Moreover, by ensuring adequate management support and providing needed resources to the innovation team, the company can work to implement the new ideas (Girotra and Netessine, 2014). An effective business innovation would be beneficial for the company to get ahead from competition. In addition, to ensure the long-term success of the new innovation, the company should develop a change management process that continuously analyzes the organizational as well as market changes and also develops necessary plans to implement those changes successfully. At the same time, the company should also focus on developing resource based capabilities in terms of human resource, equipment, and financial resources so that business innovation processes can be supported adequately to improve revenue and profitability position. Moreover, the company should also build a strong technological base so that new and innovative processes can be assisted to ensure long-term business success.
References
Abbott Risk Consulting Ltd (2015) About Us. Available at https://www.b.co.uk/Company/Profile/207314 [Accessed: 26th July 2016].
Al-Hakim, L. (2010) Innovation in Business and Enterprise: Technologies and Frameworks: Technologies and Frameworks. UK: IGI Global.
Annual Report (2014) Available at: https://www.burberryplc.com/documents/ar-13-14/burberry-annual-review-2013-14.pdf [Accessed: 26th July, 2016].
Clegg, S. R., Kornberger, M., and Pitsis, T. (2011) Managing and Organizations: An Introduction to Theory and Practice. USA: SAGE.
Cole, G. A. (2003) Strategic Management. USA: Cengage Learning EMEA.
Girotra, K. and Netessine, S. (2013) Business Model Innovation for Sustainability. https://centres.insead.edu/corporate-governance-initiative/hot-topics/documents/BusinessModelInnovationforSustainability3-Final.pdf
Girotra, K. and Netessine, S. (2014) Four Paths to Business Model Innovation. Available at https://hbr.org/2014/07/four-paths-to-business-model-innovation [Accessed: 26th July 2016].
Kaplan, S. (2012) The Business Model Innovation Factory: How to Stay Relevant When The World is Changing. UK: John Wiley & Sons.
Sadler, P. (2003) Strategic Management. UK: Kogan Page Publishers.
Varbanova, L. (2013) Strategic Management in the Arts. UK: Routledge.
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