Innovation Activities And Firm Performance Essay


Discuss about the Innovation Activities and Firm Performance.



The marketing innovation means the implementation of new marketing strategies and techniques through the inclusion of various changes in the designing and packaging of products and services to attract more customers. The marketing innovation also comprises of placement of products and promoting those by following new approaches and setting up new prices for influencing the consumer behavior and generates more revenue in business. The topic will illustrate about the three major issues in innovation management that can be experienced at business organizations like BMW and these are important for management of successful business functioning (, 2018).

BMW is one of the largest car manufacturers in Australia that has design award winning cars to serve the middle class people as well as the luxury customer segments. The company was founded in the year 1916 and presently is has been managed by its CEO named Harald Kruger. The company has a operating income of €9.665 billion and a revenue of more than €94.163 billion. The types of products are mainly different cars that are suitable for both the middle class and luxury segment consumers. The nature of the industry is the automobile industry and it has introduced the best class vehicles that provide both comfort and safety while driving (Sok, O’Cass & Sok, 2013).

Three issues in innovation management

The innovation process should be managed by selecting creative individuals at first, then develop knowledge and skills through management of operating functions and activities and lastly, improving the company’s architecture and create external links to adapt to the societal changes. This would also help in meeting the demands and preferences of the market as well as promote knowledge inputs to facilitate the scientific and technological developments at BMW with much convenience (Rozdolskaya, Ledovskaya & Afanasiev, 2013).

One of the major issues in innovation management, which is important and need to be considered by BMW is the differentiated and integrative innovation concept. Often the automobile industry wants to manage sustainable innovation, which is not possible by one-sided approaches. It is important to conduct individual assessment and the differentiated approaches for enhancing the innovation capabilities and improve the business performance, furthermore keep the objectives inclined with the needs and requirements of the customers in various market segments. Due to one-sided approach, the innovation skills might hinder and thus create failure in adapting to the changes within the industry. One of the major challenges faced due to this could be to gain ambidexterity for managing separation and integration at the same time, which might even interfere with the core business practices (Ceylan, 2013). Due to this, the company might fail to adapt to the changing needs in the market and develop knowledge to promote innovation of products and services successfully.

Another major issue in innovation management could be related to the firm’s architecture and external linkages. This could often create difficulties in responding to the societal changes and fulfill the demands and opportunities of the market properly. Due to this, the business models are developed in lesser numbers and radical innovation effectiveness are deteriorated. Due to the inappropriate firm’s architecture, the systematic approaches to business model innovation will not be established properly, which can further not keep the processes for product innovation in place. To deal with this kind of problem, the company has promoted the benefits of the vehicles such as compulsory fitting of Takata airbags in every vehicles to ensure that the level of safety and convenience is increased for the driver and passengers (Ersun & Karabulut, 2013). The virtual innovation agency has been formed to develop paths for innovative solution and this made created good reputation and even named BMW as one of the premium automobile manufacturers in Australia too.

Another issue for innovation management could be the lack of skilled, creative and knowledgeable workers who should be responsible for the scientific and technological developments. With the involvement of creative individuals, it would be easy to create knowledge inputs as well as bring technical innovation excellence to suit the needs of people in different market segments (Bartoloni & Baussola, 2016). The creative workers would be able to follow the systematic approaches to business model innovation and at the same time, facilitate the innovation process through scientific and emergent approaches. The knowledge kevel would also be improved, which could further create ease in developing a culture of experimentation, where innovation should be evitable at BMW (, 2018). With the knowledge inputs, the innovation process would tend to be easier to be managed, furthermore could lead to efficient business operations, processes, and bringing more profit in business.


The report was prepared to discuss the concepts of marketing innovation considering the business organization BMW in Australia. Based on the large size and wider base of customers, there could be various issues such as lack of creative workforce, management of operating functions through development of knowledge and innovation processes along with the external linkages and firm’s architecture. All these issues in innovation management were considered to ensure that the firm could manage its business operations properly, based on which, high level of profit would be generated and would also make BMW attain competitive advantage in business.


Bartoloni, E., & Baussola, M. (2016). Does technological innovation undertaken alone have a real pivotal role? Product and marketing innovation in manufacturing firms. Economics of Innovation and New Technology, 25(2), 91-113. (2018). Retrieved 18 March 2018, from

Ceylan, C. (2013). Commitment-based HR practices, different types of innovation activities and firm innovation performance. The International Journal of Human Resource Management, 24(1), 208-226.

Ersun, A. N., & Karabulut, A. T. (2013). Innovation management and marketing in global enterprises. International Journal of Business and Management, 8(20), 76.

Rozdolskaya, I., Ledovskaya, M., & Afanasiev, I. (2013). Innovation consulting services within the context of the formation of a new model of marketing innovation. World Applied Sciences Journal, 25(6), 956-960.

Sok, P., O’Cass, A., & Sok, K. M. (2013). Achieving superior SME performance: Overarching role of marketing, innovation, and learning capabilities. Australasian Marketing Journal (AMJ), 21(3), 161-167.

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