Innovation and New Product Essay

Submitted By caiqingju
Words: 1245
Pages: 5

Issues: Discuss the significance of innovation for the competitive position of the firm, why innovation is important for business organization? In what areas of the business might innovation be significant?

The basic meaning of innovation is defined as exploiting new ideas leading to the creation of a new product, process or service. Also innovation allows managers to reallocate their limited resource and make a better arrangement between those resources; these will make the firms gain competitive advantages in today’s society. However the most important thing is to convert those ideas into the real product or service and brings them into market place. Therefore businesses could generate profit by innovating the new ideas. In the past, businesses can be able to survive with just a bit amount of innovation, because in that time the major area that they should focus on that is the product or service’s quality, therefore by only forcing on product’s quality instead of innovating new technology or new production methods, they could also make enough profit by lower their price and improve the product’s quality. However in the modern society, due to some factors such as globalization and outsourcing, large companies started to push themselves to improve their ability of innovate new technology or process in order to improve the efficiency and effectiveness in the production level. Modern businesses need more than just good quality and low price, they require something more such as innovative processes or management that could decrease the costs and improve the productivity at the same time. Today, Innovation has become the most important factor to decide whether the business would be able to success or not in the long run.
The importance of innovation in organization is keys value for the longevity of an organization especially those large corporations such as Apple and IBM; Business began with customer’s needs and wants. They saw those needs in the society and if they want to generate profit from those needs, they have to come up with a solution, which could catch those opportunities and meet consumer’s needs and wants, finally make people’s life more comfortable. And these solutions kept evolving to become better and more useful. Therefore, entrepreneurs must keep themselves awake with the current trends, and constantly innovating new method without sacrificing the quality, and if they start to fall from the current trend (due to low innovation ability), it is quite hard for them to catch up and even more they might lost the whole game in the end.
Kodak is an obvious example to show people why innovation is such important factor in the business competition, and the consequence that firms might received if they disrespect their innovative outcome; “You press the button, we do the rest” with this slogan and the first personal auto camera, Kodak almost become the world’s top camera producer in 1964. And most people think that Kodak is the best camera producer in personal photographic industry. Also people might don't know that Kodak invent the world’s first digital camera in 1975. However, Kodak think that if they put too much money and attention in this new and unpredictable product, it might damage the sales of the traditional film, therefore they had give up this new product and increase the input in roll film. In 2012, Kodak—a legend in personal photographic industry forced to declare bankruptcy. Because Kodak has not recognized the importance of innovation, they have already lost their competitive advantages in the cruel business competition. At the mean time, their competitors start to develop this new technology and put lot of resource in order to gain competitive advantages through the innovation.
While Kodak announces their bankruptcy, Apple, as the world most powerful technology company has became a well-known name for most of the people recently. Also many people consider apple as the world’s greatest product…