How does innovation influence performance and survival in organizations?

By using this sheet you are making the following declaration.” wish the examiners to be aware of my disability and to follow the University guidelines for marking the work of disabled students when marking my work. I am registered with Student Wellbeing, Learning and Welfare Support and they have agreed that I am entitled to use this cover sheet. understand that claims for allowances not authorised by Student Wellbeing, Learning and Welfare Support or the Examinations Office will be considered an offence under the University’s Code of Practice on the Use of Unfair Means. How does innovation influence performance and survival in organizations? Introduction Most businesses seek to advance. There are many ways that businesses can advance one of which is through innovation. However, this is not the only way that a business can advance given that it can diversify, get involved in other forms of business, as well as expand to areas that are yet to be reached. Despite the many options, innovation seeks to find a need and satisfy it while still within the current business premises and situations, which at times saves a business a lot of money. In a way, where there is continued competition, what is needed is continued innovation so as to keep opening a gap between competitors and as such satisfying a once unprecedented market niche (Castaño, Méndez, & Galindo, 2016; Bryson & Daniels, 2015). Literature review In the recent past, many organizations have cropped up making competition for production of goods and commodities to be felt almost in every facet of business. This in a way has caused a lot of business to shift their areas of production or diversify (Love, & Roper, 2015). In fact, it is common to find an organization selling two diametrically opposed commodities just to remain afloat (Coulson-Thomas, 2016). Such a case happens majorly because these organizations want to offer different commodities for the public. In addition, for organizations that are unable to innovate, many of them have sought to invest in the lines of business with less risk so that they can continue being profitable even when their industry seems dying (Boons & Lüdeke-Freund, 2013). Many businesses nowadays have to content with movement of goods from Asian markets that come in cheaply, meaning that the local commodities end up losing market share to commodities that move directly from other markets (Olavarrieta & Villena, 2014). Commodities from such markets are cheap due to a readily available labor, and because the labor is not expensive. Organizations like Interface Inc., an innovative carpeting company that has been in existence for over 40 years, have been able to perform above expectations. Every year, the ever loyal customer base is assured that there will be a new, better and exciting product (Rexhepi, Kurtishi, & Bexheti, 2013). Some companies just stick to original forms and while at it keep innovating so that the clients do not lose identity of the organizations (Tsvetkova, Thill, & Strumsky, 2014). In a way, such organizations ensure that they keep in touch with what they gave customers at first; not just the company logo. Even in the vehicle manufacturing, organizations have been overdoing themselves trying as much as possible to create a difference between them and their peers (Visnjic, Wiengarten, & Neely, A. (2016). For instance, currently, organizations are competing to put in place an alternative powering mechanism in vehicles. Such has lead to hybrid vehicles by companies such as Lexus and many others (Velu, 2015). Many existent online platforms are in existent and can allow organizations to try out their new products for market. This way, an organization does not have to invest too much in marketing or on producing many commodities as it can measure the market responsiveness by merely availing commodities for people on these platforms. In a way, a business stands to gain a lot given that it can use less money to achieve much. Process innovation has been examined by many disciplines and its connection to business growth and success evaluated (Damanpour & Schneider, 2006). Process innovation should be done in a systematic manner and not in an impromptu manner as it includes the day-to-day pressures of the firm, creation of the firm’s long-term and shot-term vision and a total comprehension of the current process and ways of designing a new one(Ibid). This proves that innovation is key to the firm’s financial success as it results to the growth and increase in profitability of an organization (Van Der Pannes, 2003). Van Der Pannes (2003) states that productive elements of innovation are divided into two broad areas of organization; the technical and commercial capabilities (Ibid). Technological capability involves factors related to the organization and the projects they carry out. Organizational factors include organization culture and structure, the company’s strategy towards research and development and their R&D team characteristics projects they carry out. Project factors include how the project complements the organizations assets and style of management whereas commercial capability involves factors related to the product the organization is offering to consumers and the market it’s selling its products to. Factors related to product involve the prices and quality of the product. Factors related to the market include market introduction and concentration (Van Der Pannes, 2003) The capability of firms in terms of its resources have been identified as critical in realizing competitiveness. Innovativeness in terms of research and development is a primary tool of growth that increases a company’s market share and gives the firm a competitive advantage over other companies (Gunday et al., 2011) A firm that performs well has better access to finance to facilitate further innovation.