Innovation

Innovation is the process of copying, modification, adaption and/or transformation of existing ideas into new and creative ideas, in the production process for goods/services. It is the commercial exploitation of new ideas. Innovation includes the following:

• The introduction of a new good/service

• An improvement made to an existing good/service

• An improvement made to the operating procedures of a business

Research and development (R&D) is the scientific research and technical development of new products or processes.

There are many different types of innovation:

• Product – The creation of a new product or an improvement to an existing one.

• Service – The offering of a new or improved service.

• Process – An improvement made to the operating procedures of a business, or the way production takes place.

Innovative organisations tend to share 5 common features:

• They have a climate and internal culture that encourages innovation

• They tend to focus on understanding the needs of the consumer.

• They have an efficient system of delivering goods/services to the customer.

• They have sufficient resourcing of R&D.

• They possess an effective system for turning ideas into products.

The Innovation Process

Innovation usually occurs in the following way; the itali represent the universal steps:

• A new idea is presented.

• The screening and concept test occurs. The product can either be rejected or can move on.

• If it moves on, it will reach the thorough screening stage. Market research will also take place. The product can still be rejected or it can move on.

• The costs are worked out and compared against the budget.

• A prototype is then built. Changes can still be made to the product.

• The product is then tested and the market acceptability is analysed.

• The product is manufactured.

• The product is launched.