Innovation Management in the Automotive Design & Manufacturing Industry

Alongside the entrepreneur spirit, Innovation is the process of taking new ideas and implementing them into the market. Key word being “new”, an innovation can be sometimes viewed as the application to better solutions that meet new demand-requirements, inarticulated needs or existing market needs. Innovative ideas range from: goods, services, products, processes, services, technologies or ideas that create value for which customers will pay for. For an idea to be an innovation, it must be replicable at an economical cost and must satisfy a specific need. This means is that one must be ready and willing put their new idea to the test. On the other hand, there is recognition that “innovation is also critical to cultural, environmental, social, and artistic progress as well” (Bullinger, 2006). With this stated, high-tech innovation is ultimately the reason why we can be thankful for the many new conveniences of the 21st century. Although we might see the forefront of innovation being very prominent in today’s world, innovation is truly nothing new. From the start of modern man times, innovative ideas have paved the way for civilization to advance and develop into what we are today and at the same time, we have barely begin to chip away at the tip of the iceberg of our true human potential. Some scholars believe that innovation is a

Being innovative does not only mean inventing. Innovation can mean changing the business model and adapting to changes in the environment to deliver better products or services. Successful innovation should be an in-built part of a business’s strategy to create a culture of innovation and lead the

Innovation may be linked to positive changes in efficiency, productivity, quality and competitiveness, among other factors. Benefits of innovation could be the improvement in the workforce. By improving the workforce an organisation will benefit from increased productivity and improved morale and lower staff turnover. Employees will feel more valued which therefore increases motivation. This is beneficial to employers because it provides the organisation with knowledgeable, reliable staff who will have a more positive contribution to the needs of the organisation. Staff are a valuable source of innovation, even if it is not expected as a major part of their job. An innovative work environment means being creative and try new techniques. As Albert Einstein said “if you always do what you’ve always done, you will get what you’ve always got.”

Innovation is not a single activity; it is a process. For businesses, innovation means fresh ideas, developing new products or services and its effective processes. Innovation can be key to any business or company in the future. Bringing innovation into your business can help you save time and money and gives you the competitive advantage needed to grow your business.

Innovations form the main sources of competitive advantages and are always of significance for the growth of a company. Companies or organizations put their greater efforts in improving their performance by finding new ideas and knowledge on the best way of beating their competitors and therefore give satisfaction to their customers. There are various factors involved in the innovation design system which can be either internal or external.

Innovation is a term that is so widely used and thought of as simple inventions, but it is truly so much more. Innovation is a complex thought process of new ideas that can be implemented for the betterment of many. Change and adaption within any environment is the foundation of innovation and identifying its sources make it easier to implement innovation. The easier it is to foster an innovative environment and inject innovation; a positive impact on a business is instantly seen

The environment of an individual including culture of the company, management style, level of stress at work, etc…are also very important factors.

❖ Innovation is the main driver behind competitive advantage in the marketplace. Therefore real commitment to innovation will require heavy investments in products, partnerships and research.

With a wide variety of vehicles and manufacturers due to low switching costs, the bargaining power of customers is very high in the automobile industry. Also foreign brands are selling vehicles in the Indian markets, adding to the bargaining power of customers in this industry. Thus the value created by the firm lies in adding differentiating features by innovating and increasing the customer’s willingness to pay while reducing the supplier’s opportunity cost.

Tidd and Bessant (2009) argued that “Unless an organization is able to move into further innovation, it risks being left behind as others take the lead in changing their offerings, their operational processes or the underlying models that drive their business”.

Innovation refers to finding new ways to improve the existing products, services, processes, technologies, and employee performance in an organizational setup. In today's competitive business environment, organizations have to focus on bringing innovation in each and every aspect of their business operations; like products or service offerings, enterprise resource planning systems, marketing and promotional efforts, and organizational structure. The market challenges and competitive pressures also force organizations to use a blend of all these innovation processes in their business activities. Therefore, it is vital to give an equal focus on product innovation, process innovation, marketing innovation, and organizational innovation within the limited organizational resources and capabilities.

Honda has earned a reputation of being a reliable, affordable and modern producer of automobiles since its developments. “[Honda] is also the eighth biggest automobile manufacturer in the world, an industry into which it had a very late entry. In 2012, Honda had more than $99 billion in revenues out of which $3 was the yearly profit” (“Honda”, n.d.). Honda generates its revenues by producing a wide range of products, and allows more options for consumers to choose from. Additionally, “it has more than 175,000 employees located in various parts of the World” (“Honda”, n.d.). Honda began as a small business and had a team of twelve employees and producers. In present day, Honda has improved the labor force and employed over 175,000 employees, which greatly exceeds the original employee amount. Lastly, Honda has shown its progression in variability and number of products, “as of 2013 it has released more than thirty models of cars bettering its performance year after year” (“Honda”, n.d.). This shows continuous growth for Honda, and conveys a factor of the company’s success.

Innovation offers the companies a competitive advantage. Presently and within the future, more than any time in history, the key to competitive advantage is innovation. However innovation will facilitate businesses meet all of their strategic challenges, not simply competition; to illustrate, in confronting accelerating rates of change, globalization, apace advancing technology, a additional numerous workforce, associated a modification from an industrial to a knowledge-based economy. Meeting all of those challenges helps the firm attain competitiveness, and meeting these challenges suitably depends on innovation. Innovation allows a firm to workout its challenges in distinctive ways in which build competitive advantage either through relative differentiation, a relative low-priced position, or few acceptable level of each. Innovation cannot assure success, however success cannot be achieved within the end of the day without it.

This century has been full of innovation. New technologies, new products, new services, whole new industries have emerged. Yet the call for innovation in business has never been more intense. Why? Here is my list of the top ten reasons for why we need innovation. 10. For economic growth This is the most often cited reason for needing innovation. Innovation is the route to economic growth. Industries are maturing. Products are maturing. Innovation is the creation and transformation of new knowledge into new products, processes, or services that meet market needs. As such, innovation creates new businesses and is the fundamental source of growth in business and industry. 9. For

Banbury and Mitchell (1995) state that innovating in terms of product development and rapid product introduction were crucial to reach high performance. Moreover, Johnson (2001) concludes that surviving in an increasingly competitive marketplace required large businesses to take a proactive attitude towards innovation. Small and medium enterprises must also innovate in order to improve their performance (Rosenbusch, Brinckmann and Bausch , 2011).