For firms have to be agile and adaptive. It

For decades now, the importance of firms being innovative and flexible has grown. OECD defines marketing innovation as: “A marketing innovation is the implementation of a new marketing method involving significant changes in product design, or packaging, product placement, promotion or pricing (OECD, 2005).” In the fast changing market, firms have to be agile and adaptive. It is a dynamic and challenging environment that constantly is changing.

It can be difficult for companies to create competitive advantage if they are not adapting to this fast changing market (Ireland and Webb, 2006).  Not only is it important for a firm to increase the technological innovation, the firm’s service innovations has become increasingly important as well. “Service innovation is the process through which a firm undertakes changes in its philosophy, culture, operations and procedures to add value to the result of the service/product or the benefit of the customer (Kandampully and Duddy, 1999:51-56).” Strategic direction (2011) argues that in order for firm to compete in an uncertain political and economic climate, the firms should develop strategies for effective innovation. They also state that modern innovation may involve external as well as internal collaboration. Innovation can be in many different forms, it can be internal innovation where a organization requires collaboration between departments within their own organization.

Best services for writing your paper according to Trustpilot

Premium Partner
From $18.00 per page
4,8 / 5
4,80
Writers Experience
4,80
Delivery
4,90
Support
4,70
Price
Recommended Service
From $13.90 per page
4,6 / 5
4,70
Writers Experience
4,70
Delivery
4,60
Support
4,60
Price
From $20.00 per page
4,5 / 5
4,80
Writers Experience
4,50
Delivery
4,40
Support
4,10
Price
* All Partners were chosen among 50+ writing services by our Customer Satisfaction Team

This way the company can share their expertise (Strategic Decision, 2011). According to Loewe and Dominiquini (2006) it is difficult for CEO’s to overcome several innovation barriers. They argue that only a few companies know what innovation is and understand what it takes to create a sustainable organization-wide capability for innovation. In this research they found out the top six obstacles to innovation that were identified by the respondents in that research.

Those obstacles are: short-term focus, lack of time, resources or staff, leadership expects payoff sooner than is realistic, management incentives are not structures to reward innovation, lack of systematic innovation process and the belief that innovation is inherently risky (Loewe and Dominiquini, 2006). One of the biggest challenges for firms is the continuous environmental change, global competition and the fast changing technological capabilities (Ireland and Webb, 2006). In the McKinsey study discussed by Richardson (2010) it is stated that more than half of the executives said that their firms are good at executing on a few ideas but that the innovation is not well scaled throughout the entire firm. They also mention that it is challenging for the firms to commercialize ideas. The main problem here is that innovative ideas are not protected when they are passing through decision stage-gates.

Some firms might think that if they are innovative in one part of the firm that everything will be innovative, but according to Richardson (2010) it should be implemented in multiple areas of the firm to have a innovative strategy. This has not just been an issue in the past decade, Millman (1982) mentions that throughout the innovation time period, many different events in the firm can threaten the commitment and delay commercialization. Many firms are joining forces to develop innovations, for example, supply-chain partnerships or precompetitive alliances. This can be a difficult process as well since firms need to find the right partner, negotiate, and agree on shared goals.

Innovation is a risky activity and a joint innovation project can bring extra complications (Bidault and Castello, 2010). When a firm is working with digital technologies and have both innovative products and processes, they should break away from the well-known innovation path. Svahn et al. (2017) created four concern when it comes to digital innovation. Firms should develop new  capabilities without harming existing products. Firms should try to find a balance between developing new designs and management processes. Firms should build relationships with the internal work arrangement while at the same time engaging with external resources and partners.

Lastly, firms should find a balance between control and flexibility to increase exploration of digital options. This way the creativity and differentiation is recognized without damaging authority structures and integration arrangements (Svahn et al., 2017). Even though it can be very challenging for an organization to be innovative it also brings a lot of benefits to an organization.

Innovative companies often lead the way when it comes to new technological advances. For example, Apple is a company that continues to redefine technology and information in certain ways that the impact they have is overwhelming. When companies make innovation their priority they can make themselves stand out in a crowd and profit from that extremely (Lewis, 2018). Some of the advantages of an innovative company are creativity, leadership, experience and name recognition. For smaller business it can be very valuable to hire the most creative talent possible in order to stand out from the crowd.

When a firm is very innovative it often puts them in a leadership position, this is also the case with Apple. They generally set the bar for other companies with their products (Lewis, 2018). However, professionals disagree with the fact that Apple is a very innovative product. Adams (2015) argues that in the last few years Apple has not modified its products very much, aside from small improvements in their products. When you look at Apple on a month-to-month basis, there is not much happening compared to Android (Adams, 2015).It can be very challenging for companies to change their products and processes to become more innovative or for innovative companies to stay innovative.

This is mostly because the markets are changing very rapidly, and in order to keep up with the market and the environment a lot of change is needed. When a company succeeds in being innovative they can obtain the market leader position and gain competitive advantage.