MKTG90048 Chap.7 Innovation and Commercialisation
Innovation and Commercialisation
Innovation in business markets is broader than a new physical product. The object of change may be a product or service, a process, an individual component, the design linking components, a technological platform or the business model through which value is created and captured. Classification clarifies which capabilities, adoption barriers and commercial questions matter, but it is not a strategy by itself.
Novelty must also be located: new to whom, compared with what and at which level? Incremental and more radical change describe degree, while disruption concerns a competitive path and should not be inferred from technical impressiveness alone. Ideas can originate through internal creativity, user toolkits, open innovation and lead users whose demanding needs anticipate a wider market.
Commercialisation then turns an invention into customer adoption and captured value. It connects development with sales, channels, pricing, complementary assets, knowledge protection and frontline implementation. A bounded pilot is useful when it separates technical, adoption and commercial uncertainty and uses evidence to decide whether to revise, scale or stop.
What this chapter covers
- 01
Innovation types: locate what changes. Products and services alter the offer, processes alter creation or delivery, components alter a part, designs alter linkages, platforms establish a base and business models alter value creation and capture.
- 02
Incremental change: modify an established technology, offer or market without assuming that modest novelty means modest managerial work. Even an incremental change can require customer learning, workflow redesign or new selling evidence.
- 03
Disruptive innovation: treat disruption as a competitive trajectory and market effect, not a synonym for novelty. Technical sophistication or a dramatic launch does not by itself establish that an innovation is disruptive.
- 04
Lead users: seek users whose needs are ahead of the general market and who gain strongly from finding a solution. Their experience can reveal demanding problems and solution ideas before those needs diffuse.
- 05
Commercialisation: connect opportunity selection and development with adoption, pricing, sales, channels, complementary capability and protection. The route must allow the firm to deliver value and capture returns.
- 06
Pilots and evidence: define the uncertainty, comparison, observable outcome and decision rule before starting. A pilot should resolve a question, not merely display activity or generate favourable reactions.
Worked example · free
What the predictive-service pilot must prove
- 1Classify the objects of change: the offer becomes a service, delivery changes through data-supported maintenance, and recurring fees may alter the business model.
- 1Separate technical evidence about prediction from adoption evidence about workflow and commercial evidence about the value customers are willing to exchange.
- 1Set observable outcomes, a suitable comparison and decision rules that indicate whether to revise the design, run another experiment, scale or stop.
Key terms
- Process innovation
- A new approach to creating or delivering an offering.
- Design innovation
- A reconfiguration of linkages among components.
- Commercialisation
- The activities that turn an innovation into adopted and captured market value. They link development to customers, delivery capability, sales, channels, pricing and protection.
- Platform innovation
- A technological base on which related offerings or applications can be developed. Its value depends partly on how it supports further innovation and complementary participation.
- Business-model innovation
- A change in the system through which an organisation creates and captures value. It can alter revenue logic, responsibilities, relationships and required capabilities.
- Lead user
- A user whose needs precede broader market demand and who expects substantial benefit from solving them. Lead users can supply demanding problem knowledge and solution insight.
- Open innovation
- A deliberate use of knowledge flows across organisational boundaries. It recognises that useful ideas and routes to application may come from or move through external parties.
Innovation and Commercialisation FAQ
Is every new technology disruptive?
No. Disruption describes a competitive path and market effect, not merely novelty or technical impressiveness, so it requires evidence beyond the product being new. First identify the object and degree of change. Then examine whom the innovation initially serves, how its performance and value proposition develop, and what happens to established competitors and markets over time.
Why classify innovation type?
Different objects of change create different capability, adoption, coordination and protection requirements. A component change may require qualification, a design change affects linkages, a process change affects delivery routines, and a business-model change can alter revenue and responsibilities. An innovation can span several types, but naming each object prevents one broad label from hiding distinct implementation tasks.
What makes a pilot useful?
A pilot needs a learning objective, relevant comparison, observable outcome and decision rule. Define what remains unknown before choosing the activity. Measure technical function, customer adoption and commercial viability separately where all three matter. Decide what result leads to scaling, redesign, another experiment or termination.
Activity without a decision rule can produce anecdotes while leaving the original uncertainty unresolved.
How do lead users and toolkits contribute differently?
A lead-user process searches for people or organisations facing advanced needs and learns from their problem-solving experience. A toolkit gives users a structured way to express preferences, configure alternatives or develop solutions when their need information is difficult to transfer. Both move user knowledge closer to development, but one emphasises whom to learn from and the other how users participate.
What can block commercialisation after a successful invention?
Customers may not adopt, complementary capabilities may be missing, the channel may not support the offer, pricing may fail to capture value, or frontline sales and service teams may lack knowledge, incentives or workable processes. Knowledge protection can also be too weak to preserve returns or so restrictive that partners cannot contribute. Commercialisation must align the whole route into use.
Exam move
Create an innovation diagnosis table with four columns. In the first, state the customer problem in operational terms. In the second, classify every object that changes: offer, process, component, design, platform or business model. In the third, locate novelty by asking new to whom, compared with what and at which level; reserve disruptive for an evidenced competitive trajectory rather than using it as praise.
In the fourth, identify the next missing evidence for technical function, adoption, delivery and value capture. Convert one row into a pilot plan with a learning objective, comparison, observable measures and revise, scale or stop rules. Then map the commercialisation route: internal capability, partners or licensing; sales and channel requirements; pricing logic; frontline adoption; and appropriate knowledge protection.
Finally, note whether lead users, a user toolkit or external collaboration could surface knowledge that the firm does not possess internally.
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