3.13 oprational strategies - innovation - moodle
- 1. Do Now – Gimme 3! Write down three key learning points from the previous lesson. Prepare to discuss what you have written.
- 3. Learning Objectives By the end of the lesson you should be able to: 1. Understand the importance of innovation and research and development to the competitiveness of larger business. 2. Recognise costs and risks of innovation and research and development 3. Analyse the implications of innovation to finance, marketing and human resources.
- 4. Discussion Point Innovation: The launch of a new product or process, an What is meant by innovation? invention, onto the market for commercial gain Finish the following sentences: The strategy of innovation has implications for other The strategy of innovation has implications for…. functional areas. The risk risk of heavy investment in R&D alsohas potential The of heavy investment in R&D also has…. rewards.
- 5. What is research and development (R&D)? R&D is the scientific research and technological development of a new product or process. Questions Answers 1. Along with product development 1. Improve existing products or what could R&D also improve? production process. 2. What does R&D enable a firm to 2. Competitive advantage with a USP have? and greater efficiency. 3. Draw a product life cycle – where 3. At the start of the PLC. does R&S appear? 4. Money only flow in one direction for 4. What are some of the downsides R&D so firms may want to keep this of R&D? to a minimum. 5. Looking back at your PLC, what 5. Can prevent products going into decline once they have matured in else can R&D help to prevent? the PLC.
- 6. The process of R&D Write a description based on your cue card. Place the card in the correct order in process of R&D. You must be able to justify your reasons. Idea Generation Idea Screening Concept Testing Development of idea Business Analysis Product Development Test Marketing
- 7. Using the following key words/ term, sum up the purpose and cost of R&D…. New Products or Processes Costs Maintain Market Share Position Opportunity Cost Competitive Advantage
- 8. Discussion Point 1. List the companies that you associate with the word ‘innovation’. 2. What industries are these companies in? 3. What are the characteristics of this company? Decide - To which company would you award a trophy to as ‘top innovator of the year’?
- 9. What are the risks and rewards of R&D and launching new innovation? Risks Rewards Heavy time and resource Develop USP leading to commitment with no competitive advantage. guarantee of success. Charge premium prices Competitors reactions. Improvements in efficiency Loss of business direction. and production process. Company image/ reputation Reputation of being damaged. innovative.
- 10. What is the impact on marketing, finance and human resources? Marketing Finance Human Resources May act to inform the Setting an monitoring Oversee R&D workforce R&D department of a budgets for R&D. needs/ issues. potential niche or customer opinion – Costing new products. Increase or reduce market-led. staffing numbers. Work with marketing to Play major role in develop pricing promoting or getting structures/ profit. the product to the consumer.
- 11. Test Yourself! 1. What is meant by the term innovation? 2. Why are patents often associated with investment in R&D? 3. Explain one benefit of investment in R&D. 4. If R&D is high risk then why do firms undertake it?
- 12. Re-cap Learning Objectives You should now be able to: 1. Understand the importance of innovation and research and development to the competitiveness of larger business. 2. Recognise costs and risks of innovation and research and development 3. Analyse the implications of innovation to finance, marketing and human resources.
Editor's Notes
- #5: Case Study – Designs on Dyson (P96)
- #6: Innovation – can also be the improvement of existing products, processes or services etc.
- #8: Top spenders in R&D – P99How should this be
- #9: Innovations of Australia - http://www.bbc.co.uk/news/magazine-20071644
- #11: Kerboodle – Innovation Case Study: How 3M do it!AQA Question Sheet
- #13: Kerboodle Test Yourself task.