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Building and Managing Capability for Marketing Innovation - Essay Example
Author : tsmitham
Pages 10 (2510 words)
1. Introduction: Business model innovation is becoming increasingly important in a world where competitors can easily imitate strategies. Business model innovation represents a higher order of innovation compared to product or process innovation. Many standard business functions have been undergoing radical transformations…
New channels are proliferating, traditional distribution channels are consolidating, and competitors now come from all over the world, increasingly, with lower costs and sometimes of higher quality. By tapping multiple sources of competitive advantage, a new business model can help a company leapfrog competition. Companies need to keep examining their business model and their relevance for customers in an era of cutthroat competition.
2.1. Definition: An innovation represents a significant improvement over what exists. A successful innovation generates a product or service that is valued highly by customers. As Peter Drucker (1988, 149-57) puts it, "innovation is the process of finding a new with a new capacity to create wealth. Innovation may improve the yield of existing resources or may provide more value or satisfaction to customers." Innovation may endow resources with a new capacity to create wealth. A radical process innovation may be much more disruptive than a minor or moderate product innovation. But, in general, it may be reasonable to say that a radical product innovation is more challenging than a radical process innovation. ...
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