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BUSINESS INNOVATION

Introduction

The proliferation of the internet and the spanning out of globalization has led to an increased business presence in industries and markets. The result has been the constant saturation of the said markets. Consequently, it has led organizations to develop newer ways through which they create newer value propositions for the business and its customers. Also consistent with these trends is the shift from a focus on the supply side of a business offering to customer demand dynamics. According to Teece & Pisano, companies can no longer depend on the accumulation of technological assets to hold a considerable competitive advantage in the market (1994, p.1). Organizations now have to adopt dynamic capabilities to make sure that they capture value wherever they can find it. The shift requires the consideration other elements such as the timely response to rapid and flexible product innovation, together with an adequate management capability, for example, to coordinate and utilize the internal and external competencies efficiently (Teece & Pisano, 1994). These capabilities rest on the potential of the resources, processes, and values in an organization, as they determine what it can or cannot do and the sorts of innovations the organization can embrace (Christensen & Overdorf, 2000). In light of this, a competitive advantage is now only made possible by the exploitation of both internal and external firm-specific capabilities, and also the development of new ones. The interaction of all these factors is what represents a firm’s innovative capability. The following article discusses a business innovation that relies on a different organizational element other than its technological aspects. The discussion employs the Bottom of the Pyramid theory by C. K. Prahalad. Continue reading