Innovation And Enterpreneurship Sample Paper

Running head: INNOVATION AND ENTERPRENEURSHIP 1

Innovation and Entrepreneurship

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INNOVATION AND ENTREPRENEURSHIP 2

Executive Summary

All businesses are run by human capital that follows set industry standards to guide their day-to-

day operation, these set of standards are referred to as Business practices. Business practices

allow to the company to meet customer expectations as well as meet the vision and objectives of

the company. These practices are often bound to change as a business due to globalization that

has increased competition in the market place. With globalization, firms need to be Innovative

and employ the sense of Entrepreneurship to stay in the market.

This report found five ways which are quoted extensively as benefits of innovation on business

practices and hence the entire business. The first is the utilization of innovation is to aid them to

be more competitive. Companies can find innovative ways to keep daily business routines better

and hence deliver products or services when needed, secondly, firms can use technology to build

the value of their brand. The report gives an account of how Virgin Atlantic has built a brand as

the friendliest airline and hence cut its hedge in the market.

Furthermore, the report has highlighted how Toyota and Canadian Blood services have used

innovation to establish new partnerships and relationships, which has not only increased

efficiency in business but also reduced workload. Lastly, innovation can help in reducing

business cut costs, the report has used the case of transportation and logistics companies to

underscore how Geographical Information Systems (GIS) and Global Positioning System (GPS)

technologies as part of communication innovations have lower costs and streamlined business

processes.

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Introduction

This report assesses how organizations utilize innovation and Entrepreneurship as a

means of enhancing business practices. According to Elbaz, Binkour & Majdouline (2013),

innovation is defined as the process of converting an idea into products or services that can be

valued and that customer is willing to pay. On the other hand, entrepreneurship defined is the

ability and readiness to organize, develop, and manage a business with its associated risks and be

able to make a profit as suggested by Ries, 2011.

A classic example of entrepreneurship is starting a new business venture. According to

Karam (2016), economists consider entrepreneurship as the art of organizing labor, land and

natural resources and capital to produce a profit. From the definitions, innovation brings products

and services to the market while entrepreneurship organizes and conveys the products in a

manner that is accepted by customers and at the same time creating revenues and profits for the

enterprise.

Aim of the report

The purpose of the research paper is mainly to demonstrate how organizations would

utilize innovation and Entrepreneurship as a means of enhancing business practices. The report

looks into current business principles and theories used by worlds’ selected Tier one corporation,

which is as a result of Innovation and Entrepreneurship.

Scope of the report

The report gives a synthesis of current literature on innovation and entrepreneurship, but

narrows down to examples of the tier one-world companies and highlighting how innovation is

keeping them in their respective industries so that they remain relevant over time while satisfying

their customers. The enterprises that were considered as examples in this report are IBM, Virgin

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Atlantic, Microsoft, and Toyota. The researcher looked at quoted literature that relates to the

enterprises mentioned as well as principles of management that are synonymous to particular

firms.

How Innovation and Entrepreneurship enhance business practice

This section will look into the flowing items as contributions of innovations and

entrepreneurship in fostering business practices, which includes competitiveness, Building the

value of your brand, establish new partnerships and relationships, Improve productivity as well

as Reduction business costs.

Competitiveness: According to Karam (2016), businesses are faced with the challenge of

out-competing other businesses. Innovation permits companies to have a competitive advantage

over their peers by being better than its competitor regarding price or quality in the eyes of their

clients, business has the chance to continue doing health business, which makes profits. Karam

(2016) quotes the concept of the 3 C's that is the customer, company and the competitor and

shows in figure 1 below how the three factors play in business competitiveness.

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Figure 1: Competitive advantage and the 3 C's

Adapted from Christopher, 2016

From figure 1, customers will to first determine the value of the services or goods offered by two

providers, after value satisfaction, the purchaser will go ahead to determine the cost proposition

by the entities and will probably pay for less costing items with same value.

Based on arguments of Chesbrough (2010) quotes Paul Horn, one-time senior vice

president of IBM in charge of 3,000 researchers, Paul was clear about how innovation was

influencing the change entire product line at IBM. When Paul Horn was asked what his biggest

problem was, his answer highlighted the place of innovation in changing customer needs. The

chief researcher stated the fact that IBM was built to manufacture computers, Servers, systems,

and mainframes. Nonetheless, the interesting part was that more than 50% of IBM’s revenue

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comes from services and not the products, he then concluded that going forward, his research

will definitely move with where innovation is going.

The conclusion by Chesbrough (2010) agrees with Karam (2016) and Ries (2011) who

explores how China is emerging as a global economy by capitalizing on modern business

Approaches to grow, win, and compete in the new global economy. Karam (2016) underscores

strive by China and its place in innovation policy environment. The researchers state that the

developing world is moving from receivers to active players in policies development, China, for

example, is beginning to shape western policies regarding innovation and modernization.

When it comes to business, from the above texts and scenarios, it is clear that innovation

drives sales by enhancing trade policies and even shaping the product line. Innovative ideas help

companies remain relevant by producing products and services in response to market demands.

Build the value of your brand: As quoted by Asker & Joachimsthaler (2012), a strong

brand works for life and gives desired results. Asker & Joachimsthaler (2012) provides an

example of Richard Branson’s’ Virgin Atlantic as one of the super brand companies that have

innovatively used their brand to win customers. When customers see Virgin Atlantic, they see

approachable, caring, innovative, intelligent, playful, and friendly enterprise. Such a culture

gives the company a leading edge when it comes to clients, and happy customers is a happy

business (Chesbrough, 2012). The question that the researcher would see here is who does not

want caring, playful, and friendly airline when going for a vacation or on a long flight.

Establish new partnerships and relationships: According to Ng, Vail, Thomas, &

Schmidt, (2010) postulates of a surprise partnership between Toyota and Canadian Blood

Services to improve Productivity, Service, and Quality. In the collaboration, Toyota brought with

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it its famous Kaizen theory, similarly denoted to as Toyota Production System (TPS). The

culture is used in the engineering field to reduce waste while retaining product quality.

Nevertheless, the Canadian Blood Services had the scientific capacity to deal with

harvesting and storage of blood. The collaboration resulted in saving of 1-hour reduction in time

that staff remains in -20°C freezers room; reorganized workstations led to 30% reduction steps

taken by employees during a typical workday, product packing time was reduced by 40% (Ng,

Vail, Thomas & Schmidt, 2010). The above scenario shows how innovation has brought

companies dealing with completely different fields have come up to supplement each other

businesses and hence quality service delivery.

Improve productivity: As cited by Hausman & Johnston (2014), Apple and Microsoft are

products of innovation during the terrible financial crisis. Brynjolfsson & McAfee (2012) puts

Apple’s investment at $10 billion, an equivalent to 30% of its revenue in the year 2012 on

research and development. This amount goes to the company’s quest to encourage innovation.

Apple has had various innovations released, which includes the most successful iPad, which has

continuously contributed to massive returns regarding stock records and prices (Brynjolfsson &

McAfee, 2012). Conversely, too few companies have had similar experiences due to lack of

rediscovering innovation as an essential tool in maintaining company profits as well sustaining

its robustness (Hausman & Johnston, 2014; Desai, 2013).

Reduce costs: Innovation has aided in the reduction of business costs, Christopher

(2016); Kramer & Porter (2011) has quoted how innovation with the use of GPS and GIS in the

transport logistics industry. Christopher (2016) particularly has shown how GIS has been used to

map out the best alternative routes for the fleet, a scenario known as route optimization and GPS

for collecting locational data as well as actual tracking of vehicles in transit.

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The two technologies have helped businesses to reduce costs associated with taking long

routes and also costs bared to lack of one single platform to manage transport systems.

Christopher (2016) puts an average of 30% in cost reduction in the logistics by employing both

GIS and GPS technologies.

Conclusion

The report found five ways that literature has quoted as the contribution of innovation

and entrepreneurship on business practices which translates to business profitability. The analysis

figured out that utilization of innovation aids business to be more competitive. Competitive

companies stay ahead of the game in the market and hence remain to be profitable for long.

Secondly, firms can use technology to build the value of the corporate brand. The report gives an

example of how Virgin Atlantic has built a brand as the friendliest airline and hence cut its hedge

in the market.

Moreover, the report has used the example of Toyota and Canadian Blood services, which

have used innovation to establish new partnerships and relationships, which has not only

increased efficiency in business but also reduced workload (Fayek et al., 2014). Lastly,

innovation can help in reducing business cut costs; the report has used the case of transportation

and logistics companies to underscore how GIS and GPS technologies as part of communication

innovations have lower costs and streamlined business processes. IBM, Virgin Atlantic,

Microsoft, and Toyota employ Innovation and Entrepreneurship in enhancing business practice,

and hence they have remained competitive in the market.

Recommendations

The report has reiterated the importance of innovation and entrepreneurship in shaping

and streamlining business practices; the researcher recommends that organizations should

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encourage innovation and in their product cycles so as they remain competitive, cost effective,

enrich other firms through partnerships, improve productivity and hence go through the current

business revolution while making profits.

The cost effectiveness to be realized by a company, the report recommends innovatively

looking at the current processes regarding the number of workers and time spent on tasks. Time

and money spent could be reduced by following the Kaizen philosophy and collaborating in

businesses just as Canadian blood services and Toyota did.

Improvement of productivity is another area recommended by the report. Just as Apple

and Microsoft did during the financial crisis, companies should invest in research and

development with an eye to improve production. Apple specifically looked at its product and

identified duplication of functions by having an extended product line, innovation through

research resulted in the birth of iPhone, which has the capacity to store and play music, take

photos, call and be used to access the internet. iPhone is the largest product in terms of volume.

Lastly, the report endorses companies to use innovation and entrepreneurship to build the

value of their brands. The example set by Virgin Atlantic shows how they have branded

themselves as an easygoing airline that has her to cut itself out in their field. Likewise,

companies should develop this principle in branding and marketing in general.

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References

Asker, D. A., & Joachimsthaler, E. (2012). Brand leadership. Simon and Schuster.

Brynjolfsson, E., & McAfee, A. (2012). Race against the machine: How the digital revolution is

accelerating innovation, driving productivity, and irreversibly transforming employment

the economy. Brynjolfsson and McAfee.

Chesbrough, H. (2010). Open services innovation: Rethinking your business to grow and

compete in a new era. John Wiley & Sons.

Chesbrough, H. (2012). Open innovation: Where we've been and where we're going. Research-

Technology Management, 55(4), 20-27.

Christopher, M. (2016). Logistics & supply chain management. Pearson UK.

Desai, J. (2013). Innovation Engine: Driving Execution for Breakthrough Results. John Wiley &

Sons.

Elbaz, J., Binkour, M., & Majdouline, I. (2013). Innovation and entrepreneurship: An empirical

study of Moroccan firms.

Fayek, A. R., Rankin, J. H., Razavi, S., & Thomas, R. (2014). Canada–innovation through

collaboration. R&D Investment and Impact in the Global Construction Industry, 64-65.

Hausman, A., & Johnston, W. J. (2014). The role of innovation in driving the economy: Lessons

from the global financial crisis. Journal of Business Research, 67(1), 2720-2726.

Karam, A. (2016). The China Factor: Leveraging Emerging Business Strategies to Compete,

Grow, and Win in the New Global Economy. John Wiley & Sons.

Kramer, M. R., & Porter, M. (2011). Creating shared value. Harvard business review, 89(1/2),

62-77.

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Ng, D., Vail, G., Thomas, S., & Schmidt, N. (2010). Applying the Lean principles of the Toyota

Production System to reduce wait times in the emergency department. Canadian Journal

of Emergency Medicine, 12(1), 50-57.

Ries, E. (2011). The lean startup: How today's entrepreneurs use continuous innovation to

create radically successful businesses. Crown Books.

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