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Innovation

Introduction

Innovation within the business context is the creation of new ideas the context of known constraints. It’s about exploiting a gap, an observed gap in the market, through the development of a new product or service that fulfils that gap.

It requires the application, implementation and exploitation of these ideas to deliver an intended business result, be it new customers, new markets, bigger margins or gaining a competitive advantage.

Further Information

The three types of innovation which people usually associate with are…

  • Service innovations such as the introduction of internet banking or credit cards.
  • Product innovations such as smart phones/watches and tablets.
  • Process innovations such as new manufacturing process that are needed to produce these new products.

There are two more often forgotten types of innovation, which are:

  • Business model innovation which is about making changes in how the company creates value for its customers and how the company captures the value from the innovation, an example of this would be Amazon, the internet bookstore.
  • Organisational innovation involves fundamental changes in practices, processes, and structure of how the activities within the business are managed. Examples are lean manufacturing, outsourcing, and supply chain.

There are also different levels of innovation:

  • Incremental Innovation (most common) – This type of innovation is about doing something that businesses are already good at, but making further incremental improvements.  An example of this would be the changes to the iPod; making it thinner, improving screen resolution etc. Companies, in general, are very good in incremental innovation.
  • Radical innovation (quite rare) – Radical innovation doesn’t happen frequently, but it does happen. An example of this would be the invention of internet, and introduction of internet, which actually created, almost, a new revolution.
  • Disruptive innovation – This type of innovation isn’t always better immediately but we see improvements in the long term, this can create challenges for some businesses because they’re inclined to ignore this technology and therefore can never adapt quickly enough. As example of this would be the invention of digital technology and the negative impact it had on Kodak and is core capabilities, despite Kodak being a part of this invention. This type of innovation generally starts out in a niche market.

Useful Links

Innovate UK is the UK’s innovation agency. They are tasked to work with people, companies and partner organisations to find and drive the science and technology innovations that will grow the UK economy.

Innovate UK video – Innovate UK’s Essential Grant Funding Tips for Startups & SMEs

Innovate UK Business Growth complements Innovate UK project funding with intensive, specialist-led support for ambitious businesses.

Innovate UK Business Connect support businesses in their innovation journey, including identifying strategic goals and innovation pathways. You can also search their events calendar.

Intellectual Property Office operates the intellectual property system in the UK covering copyright, patents, designs and trade marks.

Knowledge Transfer Partnerships (KTPs) connect forward thinking businesses with the UK’s world class knowledge bases to deliver a business led innovation projects.

Catapult Network are a network of world-leading technology and innovation centres established by Innovate UK to support businesses in transforming great ideas into valuable products and services.

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