Marketing Strategy and Competitive Positioning pdf ebook

CHAPTER 12 COMPETING THROUGH INNOVATION
External pressures include the push from intense competition, increasingly demanding cus-
tomers whose priorities have changed through the recession, and the technological drive of 
shortening product life cycles (see Chapter 3 ). 
We examine the mandate to compete through innovation at two levels in this chapter (see 
Figure 12.1 ). First, we examine key issues in innovation strategy, industry change driven by 
innovation and the impact of disruptive innovation initiatives, leading to an emphasis on 
value innovation achieved through new business models and global innovation networks. 
Second, we turn our attention to the operational aspects of new product development, 
which are driven by a company’s innovation strategy.
Certainly, new systematic product planning is a vital activity for every company, and it 
applies as much to services as it does to physical products. Generally, companies that are suc-
cessful with new products follow a step-by-step process of new product planning combined 
with effective organisation structures and processes for managing new products. Experience 
and learning help these firms to improve product planning over time. Importantly, however 
the process is organised, the corporate cultures of companies such as Apple, IBM, Facebook 
and Google actively encourage and reward innovation. It is imperative for executives to 
understand the reasons for new product failure and to avoid these pitfalls. By understanding 
the drivers of new product success, managers can check if their firm has the requirements 
for effective product innovation. If it does not, they should develop means by which the 
essentials of successful innovation are acquired to minimise the likelihood of market failure.
12.1 
Innovation strategy 
One of the most critical issues facing executives is the need for radical innovation in the 
value they provide to their customers. In many practical situations, while true innovation 
addresses superior customer value, many of the existing bureaucratic processes in corporate