Business innovation can be defined in a variety of ways. It can be defined as a creative process that results in product or service development. It can also be viewed as a new way of improving profitability or increasing business efficiency. To some extent, it can be a way of successfully exploiting new ideas or adding value to products.

Uses of models of business innovation can be explained clearly by assessing various examples. One of the examples is the industry model innovation. This model is whereby a particular business moves into a new industry or creates a new industry altogether. Sometimes it is termed as moving into a new gray space or new white space. The desired outcome is changing the way things work in a particular industry or creating an industry that did not exist before. A favorable example of this model comprises the Virgin Galactic. Here, the Virgin Group company is moving into the industry of creating space tourism. Another example is Thor Energy and STL engagement in the development of Thorium as an alternative nuclear fuel. The fuel is said to be safer and cleaner hence the companies are reshaping the nuclear energy industry. There is also the revenue model innovation. It is a model used to generate revenue by way of offering reconfiguration of products, services or value mix. There are also changes made to the pricing models. The desired outcome of using this model is to realize new sources of revenue. A good example is how SKY Media Company is re-bundling their products into SKY Sports Bundle, SKY Movies Bundle, and Sky Entertainment Bundle. This aspect is being exercised to try and bring in more revenue. Enterprise model innovation on the other hand, involves changes in extended enterprise and networks with suppliers, customers, employees and other stakeholders. It also includes capability and asset configuration. The desired outcome when using this model is creating more value for the business. A favorable example that can be used here is Uber. The company has completely changed its business strategy through innovation. Another example is how High Street Retail companies such as Argos, PC World, and Amazon closed down shops so as to move their retail business to the internet.

Business innovation tends to have various sources of support and guidance. This encompasses both internal and external sources. Internal sources include market research, workshops, boards of directors, internal stakeholders and customer focus group among others. These are elements that provide information on what areas of business can be improved by way of innovation. Most of the information derived is quite relevant to the organization since the sources are directly involved with the business. External sources on the other hand, comprise business networking groups, local enterprise partnerships, trade bodies, government and external stakeholders among others.

The process for a new product/service development encompasses eight stages. The first stage is all about the generation of an idea. The stage involves conducting SWOT analysis, market research and brainstorming for new product/service ideas. This is followed by the idea screening. At this stage an idea is assessed to a greater extent. Issues to do with the target market, product/service profitability, market trends and competitive pressure are examined at this stage. The next stage that follows is concept development and testing. This stage helps to ascertain the intellectual property issues, production cost effectiveness, the feasibility of the product/service, consumer reaction among others. The fourth stage tends to focus on business analysis. Here, there is an estimation of the selling price, sales volume, break-even point, profitability and potential return on investment. The figures involved must make sense for the product/service to be considered further. This is followed by market and beta testing. The stage involves testing of the package design, conducting customer focus groups and assessing the distribution channel. Technical implementation comes in as the next stage. It involves estimation of the resources required, developing an operational management plan and finalizing logistics plan among others. The seventh stage is all about commercialization. Most of the activities here are those associated with the product launch. The last stage entails reviewing of the market performance and pricing.

Innovation is usually associated with a number of risks, benefits, and implications. The benefits involved include improvements of product/services and improvement of processes. These aspects generally make the product/service more appealing to consumers. Another benefit is that it results in organizational growth and development of new markets. This is due to the elements of efficiency that might have been brought into practice. There is also the development of smarter working experiences. This is because innovation is usually associated with creativity. Despite the benefits involved, innovation is also associated with various risks. Among the risks is the failure to meet commercial and operational requirements. This is as a result of the changes that have taken place, which might affect the normal functioning negatively. Aspects of resistance to change are also likely due to the fear of the unknown. Innovation is also expected to bring along various implications. Among them there are changes in corporate strategy. Changes in various issues associated with the organization will warrant the organization to change its focus so that it can maintain the control of all the operations. Aspects to do with corporate social responsibility will also be affected. The effect might be either positive or negative depending on the nature of innovation that has been instituted. Need to train employees in order to equip them with new skills is also likely.

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