Innovation is the process to innovate new idea and product while entrepreneurship is the process of designing and launching a new business with their new ideas. The report main aim is to understand the importance of innovation, entrepreneurship and sustainability to the economic firm. The chosen industry is retail industry and firm for this report is TESCO in retail industry UK which offer different services and products to their customers such as clothes, food product etc. Report describes the innovation challenge faced by the company and also describe the factors that affect the firm's ability in order to respond those challenges. Further it recommended some methods to address those challenges.
As retail industry faces some challenges for innovation and there is a need to overcome such issues. Recently the company wants to innovate personalised t-shirts but on the other side it faces issue regarding measuring and benchmarking innovation. It has been realised that this is the core method to improve the success of the firm. On other hand, traditional Key performance instruments such as sales volume and revenue are considered the best method to measure the success. For this report, I chose retail industry because it is one of the leading industry in UK and it also tries to innovate new products and services in order to meet out the demand of their customers. But because of not using modern method of measuring the performance is not adopted by the firm and that is why it also faces some issue regarding innovation (Verreynne and et.al.,2019). The chosen country is United Kingdom because it is one of the developed country and have many big firms who always produces new things in order to satisfy the needs of their customers.
For example, TESCO which is one of the leading firm in UK, also not provide a better experience to their customers. That is why to attract wide range of customers towards them, now TESCO innovate new products with better planning. In the same way, quoted firm is actually offer new personalised t-shirts so that it will help to maximize the sales and profitability of the company.
As per the view of Mendis, Lemley and Rimmer (2019) innovation is the term of new idea, creative thoughts or new imagination in the form of device and methods. Innovation is also provided a better solution in order to meet out the new requirements of their customers. The innovation is also takes place through the provision for more effective products and services that made available to the markets and government. Generally many big firm innovate products or services in the terms of technologies but TESCO innovate new personalised t-shirts with 3D effect in order to attract large customers towards them. From last many years the company did not meet out the expectation of the firms. That is why quoted organization provide innovative products in order to satisfy them and maximizes the sales as well as profitability too. There are many challenges which a firm is actually suffered in order to innovate the products such as to select the best idea of innovation which help to attract customers and increases the market share in the UK.
Irani (2019) critic that in the case of innovation, big firms always faces issue regarding employees such that they are not empowered to innovate and many managers fear that it will distract the employees and they are not ready to accept the challenges. Even employees are not motivates to innovate for this reason, the leader or manager have to motivate them and provide training sessions in order to overcome this and also provide incentives which helps to motivate them. Sometimes a firm is also missing out the innovation strategy which also may cause the challenges for the firm. As it has been analysed by Acar, Tarakci and van Knippenberg (2019) that innovation is considered one of the best centralised functional group that helps to increase the performance of the company in the market and also enhances the sales in better way. Basically if the firm have the best innovation strategy then it will easily meet out the needs of their customers which will further help the firm to retain their customers and sustain their brand image in market.
As per the view of Lopez, Bastein and Tukker (2019) retail industry faces challenges of measuring incorrect innovation strategy and to improve the success of a firm it is quite necessary to use those traditional methods in order to improve the financial position of the company. It has been identified that the retail industry faces this challenges the most because it indirectly lower down the morale of the employees and as a result, sales and production level of the firm also gets affected. As innovation is considered one of the best strategy that helps to attract wide range of customers towards them and it also assists to achieve the objectives of the firm. On the other side, it has been analysed by the Kohli and Melville (2019) that build a strong innovation culture support a firm to strengthen up the financial structure of the country and also ensure that innovation is a strategic focus for every employees.
On the other side, if any company who is based upon the retail industry tries to implement innovation strategy then it has to monitor the planning for the innovation strategy and for that the benchmarking is the most important factor that helps an industry to reach its success. Thus, this strategy helps to measure the success for the company in better way. Apart from this, it has been analysed that innovation is the best strategy which is helpful for a firm to attract large mass of group, which further help to improve the sales as well as profitability. Therefore, innovation is the best strategy that helps a business to reach their aim and objectives with proper strategy (Wikhamn, 2019). In the retail industry, innovation is the foremost requirements of the company which directly raises the productivity of their employees and affect the entire working system in positive way.
As per Burns, it has been observed that if innovation is not used by the organisation then it might make it face challenges such as lack of profitability and growth. Innovation keeps the organisation meet its consumer demands and constantly find new consumer markets. The innovation strategies helps the organisation to beat its competition and find different ways to tackle the products sold by its competitors(Burns, 2016). The leader or managers of TESCO find it difficult to cooperate their teams with used innovation strategies as it makes them change their teams focus from one thing to another again and again. The managers also see their teams becoming less responsive towards new things as it takes time for them to understand about the new innovated products as well.
The organisation's entrepreneurship has to ensure that the proper training and guidance is given to their employees before considering innovating any new products and services(Barasa and et.al., 2017). Also, they have to make sure that they have necessary skills to guide and teach their employees with the respective changes TESCO is undertaking to innovate new products and services.
If the organisational managers and leaders do not hold the necessary skills to guide and train their employees correctly it can lead TESCO facing bad reputation and its consumers shifting towards it competitors. TESCO's entrepreneurship is seen as one of the leading entrepreneurship's in UK because of the company's constant product innovation and high market profitability.
TESCO's entrepreneurship to cope up with the above mentioned impact of innovation tries to innovate its product's under the same categories in which only few things are changed. Such as while innovating a new cell phone the company tries to change the new product's software and tends to keep the hardware same. This makes its easy for its employees to understand the changes made without observing any distraction in the overall product range. This strategy keeps the organisations function smooth and efficient and its employees focused towards their assigned tasks(Cao, Navare and Jin, 2018).
Along with it, the entrepreneurship of the organisation uses strategies such as to guide and make aware its employee base about the innovation that has been brought by the organisation. The tools and technique used by TESCO here is efficient management that is well aware of the tools and techniques that the organisation needs while guiding its employees regularly. Also, they make sure that each and every employee of the organisation understands the needs and requirement of the innovation that has been brought into place by TESCO.
The above strategies make sure that TESCO successfully keeps innovating new products and services without impacting its entrepreneurship in any ways(Clark and Wójcik, eds., 2018). This also makes sure that the organisation is in safe hands and can innovate as per the needs and demands of its consumers. The risks associated are handled well and the organisation's entrepreneurship is leading towards its growth and profitability.
TESCO and its innovations impact on entrepreneurship is good because the organisation's entrepreneurship is skilled and better in terms of understanding the impacts of innovation. This makes the organisation successful and growth oriented.
After the industrial revolution United Kingdom became one of the leading countries in the world which had a variety of industries producing different products at a time and supplying them across the globe. The 19th century took United Kingdom towards new technological innovations which in turn made its industrial productions fast and easy. This change brought a large demand of the country's made products from the consumers worldwide.
The United Kingdom with these large demands saw growth in new industries. These industries were not only producing the products for United Kingdom but for a worldwide consumer base(Decker and et.al., 2016). As per these different consumers demands the country saw a growth in innovation as well. Each of these consumer demands were different from each others and the industries were producing products which are different and fulfils these consumer demands.
Globalisation made the country's reach across the globe and its industries became popular and demanding. Tesco with all these changes became one of the leading UK companies supplying its products all over the world. New consumer demands made the organisation to constantly innovate new products as per their needs and requirements. This impacted Tesco's and the overall UK's entrepreneurship in many ways. It became necessary for the entrepreneurs to understand these innovations core understandings. They need to understand the global demands and why these demands required innovation. Every entrepreneur required a brief understanding of the cultures from where these consumers demands were coming from. It made it complex for the entrepreneurship to perform confidentially while taking risks in the country's market.
The arrival of internet and digitisation across the country also made entrepreneurship facing challenges because the entrepreneurs needed to study various core aspects to understand the impacts of the consumers demands. How the organisation in which they are leading is going to make the necessary changes to adapt towards the seen changes etc.
United Kingdom's becoming one with the global economy and arrival of the effective banking systems made it easy for the country to reach wider markets and increase its economy's profitability along. The industries in United Kingdom such as clothing and retail started innovating new products to deal with competition and in order to gain new consumers. Tesco along did the same thing in order to widen its consumer base and increase it profitability. In turn its leadership saw new markets leading towards growth and an increase in business. Its entrepreneurship with the new innovations of the company became more conscious about the consumer choices and the cultures in which they reside. What were making these consumers choose the products of the company and why innovation was necessary to fulfil these consumer demands.
It made the entrepreneurship become aware about the necessary changes that United Kingdom and its economy bought to the country. Innovation made the entrepreneurship suffer for a while in terms of learning and understanding its impact(Dees, 2017). As the time passed the entrepreneurship of Tesco and the overall United Kingdom became more strong towards taking new risks and identifying new markets while keeping the innovation at its required pace.
Tesco produces a wide variety of products ranging from groceries to clothing. The organisation has to constantly innovate new products in order to stand in the competitive environment of United Kingdom. If the produced goods by the organisation are not being innovated regularly, it can shift the consumers demand and their preferences towards the organisation's competitors. It can make Tesco suffers in terms of leading and managing a successful organisation.
Constant innovation also impact the organisation's entrepreneurship as while innovating a new product the organisation needs new strategies and efforts to launch that new product in the market(Freel, 2016). The entrepreneurship or the leaders and managers of Tesco has to decide how they can successfully make the innovated product reach in the market towards its desired consumers. This provides the entrepreneurship with a new responsibility every time when there is a new product launch.
Innovation requires new ideas and thoughts and the organisation has to choose or recruit those employees which are creative and intelligent. It creates a huge responsibility on the Tesco's entrepreneurship where it has to find such skilled employees for the organisation(Gruber and et.al., 2015). The leaders and managers of Tesco needs to understand what creative needs are going to be required in a person to make sure the fulfilment to consumer needs. They have to particularly find out the skills and have to later recruit those employees which hold those particular skills.
Innovation involves risk, because there is no certainty whether the innovated product will prove as a success or failure in the market(Hristov and Reynolds, 2015). The taken risk can either make the organisation lead towards profitability or can make it face huge losses. The risk is taken on the identified market analysis, trend research, forecasting etc. If the taken risk leads the organisation towards losses and the product's performance fails it can make the organisation's entrepreneurship's confidence low. The entrepreneurship tends to hesitate while taking risks the very next time when there is an opportunity for innovation.
Innovation requires huge investment from Tesco. To innovate a new product the organisation's entrepreneurship has to understand the consumers needs and wants(Kabukcu, 2015). These needs and wants are identified by using a number of techniques such as forecasting, trend analysing etc. The usage of these techniques requires a huge effort by the organisation's staff and also makes the organisation invest a lot. The entrepreneurship of Tesco has to decide weather the organisation should invest in innovation or not. It has to implement a team to understand that the organisation should invest in innovating new product or not.
The entrepreneurship of Tesco has to put large efforts in understanding the consumer's requirement. This increases its responsibility and makes it to put constant efforts in understanding what consumers wants.
The above factors explain how Tesco's innovation impact the organisation entrepreneurship. Along with it, it also explores those factors which makes the organisation's entrepreneurship to deal with innovation practices.
From the above showcased impacts on innovation it has been identified that entrepreneurship today is facing huge challenges because of innovation(Kim and Min, 2015). As innovation requires creativity, investment, large efforts etc. it distracts entrepreneurship from achieving its organisational goals and objectives and keeps its focused towards making innovation successful. Although, today's entrepreneurs are realised as how innovation will impact the particular organisation and its goals and objectives, yet there are new challenges that keep occurring and makes entrepreneurship weak. The mangers of Tesco has to be aware of the right strategies they can use while successfully launching an innovated product and make it successful within its desired consumer base.
As seen above, there are huge chances that the entrepreneurship might going to face new challenges in near future. It can be seen that because of the arrival of internet and globalisation, consumers demands are constantly shifting(Kurnia and et.al., 2015). The entrepreneurship has to determine how it will cope up with these changes and will lead the organisation towards growth and success. Along with it, the arrival of new technology is a factor that in future might make the entrepreneurship work easy. Better technology will help the entrepreneurship in manage their responsibilities easily and creating an environment that is receptive towards organisations growth and success.
Other observed trends include the growth of new markets which might make the future managers or leaders understand new cultures and their demands, this in turn will shift their focus from the organisational goals and objectives to understand these cultures and wants(Littlewood, D. and Holt, 2018).
From the analysis, it should be recommended to the managers that they should increase their ability to understand the market needs. Also, they should be able to identify different cultures and their demands. It will make it easy for the entrepreneurship to understand various contexts that comes under achieving required organisation goals and objective. Along with it, the managers should adopt necessary skills to train their employees as per the situations needs and demands and the changes arriving in innovation(Parker, 2018).
From the above report it has been identified that what factors of innovation impact the entrepreneurship. Along with it, the importance of innovation, entrepreneurship and sustainability to the economic firm has also been explained vividly in context of TESCO. The report describes the innovation challenge faced by the company and also describe the factors that affect the firm's ability in order to respond those challenges. At last, in includes the necessary recommendation and methods to address those challenges and how the managers should deal with the impacts of innovation.
Books & Journals
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Burns, P., 2016. Entrepreneurship and small business. Palgrave Macmillan Limited.
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Clark, G. L. and Wójcik, D. eds., 2018. The New Oxford Handbook of Economic Geography. Oxford University Press.
Decker, R. and et.al., 2016. The decline of high-growth entrepreneurship. VoxEU. Org.
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Lopez, F. J. D., Bastein, T. and Tukker, A., 2019. Business model innovation for resource-efficiency, circularity and cleaner production: what 143 cases tell us. Ecological Economics.155. pp.20-35.
Mendis, D., Lemley, M. and Rimmer, M., 2019. The future of printcrime: Intellectual property, innovation law, and 3D printing. In 3D Printing and Beyond: The Intellectual Property and Legal Implications Surrounding 3D Printing and Emerging Technology. Edward Elgar Publishing Limited.
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Verreynne, M. L. and et.al., 2019. Innovation diversity and uncertainty in small and medium sized tourism firms. Tourism Management.72. pp.257-269.
Wikhamn, W., 2019. Innovation, sustainable HRM and customer satisfaction. International Journal of Hospitality Management. 76. pp.102-110.
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