The Product Innovation Process

Innovation is the management of all the activities involved in the process of idea generation, technology development, manufacturing and marketing of a new (or improved) product or manufacturing process or equipment. There are different types of innovation. First, radical versus incremental innovation where one research draws the distinction between radical and incremental innovations (Abrunhosa and E Sa, 2008; Lin and Chen, 2007; Prajogo and Sohal, 2003, Forsman and Temel, 2011). Radical innovation represents entirely new and different offering through which enterprises aim to get create new markets (Garcia and Calantone, 2002).

Radical innovation has been considered as risky actions since they need the time financial resources and expensive knowledge (Cainelli et al., 2006 in Forsman and Temel, 2011). While incremental innovation includes the addition of elements of the service, product, or process. In another word, incremental innovations represent a minor improvement to the existing products, services and processes through which organization often pursue to enhance processes, make operations more effective, improve the quality and decrease costs (Sewar and Dutton, 1986 in Forsman and Temel, 2011). These additions enhance the effectiveness of the organization for their goal, at the same time maximize the customer satisfaction from these improvements.

Second, Technology vs marketing innovations. Technological innovation relating to new products, processes or services, while marketing innovation involves a change to the social structure of the organization (Rosenbusch, 2011; Damanpour et al, 2009; Auken et al, 2008; Bon and Mustafa, 2013). Technology innovation refers to any type of innovation structure from a technical viewpoint and which lies at the heart of operations; such innovations influence the flow of product or process operation (Damanpour, 2009). While marketing innovation refers to the implementation of new ideas improve organizational processes, routines, structures, or systems (Elenkov et al, 2005 in Bon and Mustafa, 2013) marketing innovation is associated with internal processes supporting the delivery of a service or products. For example, implementation of a new marketing method involving significant changes in product design or packaging, product placement, product promotion or pricing. Besides, marketing strategy usually related to pricing strategy in order to penetrate into a new market or attract new customers.

Third, Product and Process innovation. Product and process innovations are closely related to the concept of technological developments. Product innovation reflects a change in end product or services, and process innovation represent a change in the way an enterprise produces products and services (Dibrell et al, 2008 in Forsman and Temel, 2011). Product innovation aims to present a new or improved product or service for the customers and customers see the impact of such innovation in the products or services they receive, while process innovations change or improve the way organizations perform.

Gobeli and Brown (1993) say that the product innovation process contains four basic stages which are: Discovery, Decision, Development, and Delivery. For example, discovery stage starts with the research and finding innovative potentials and the derivation of ideas, which are subsequently evaluated. This involved both internal and external organization such as a problem with the customer, a possible new market or a new technical solution. It can also conduct in professional ways such as customer interviews, focus groups, lead user workshops or customer observations. The decision stage is an intensive analysis phase in order to gather as much information as possible about the idea and its further processing. For instance, the organization test or predict all the possible outcomes from an idea which they wish to innovate and ensure that the idea is tied to the organization's goal, in order to maximize the effectiveness or efficiency of a product or a service. The development stage is to develop a ready-to-use product or service that can be brought to the market. Solutions are being developed, prototypes built and tests carried out. In addition to concept and lab tests, the tests also include market tests under real conditions in order to gain comprehensive feedback. Once the solution has reached maturity, it will be released for implementation and marketing. Lastly, the delivery stage is bringing the product or service to the potential customers. On the one hand, this requires the physical availability of the product or service. These include procurement, production and logistics based on the defined concepts.