MNGT1002 Introduction to Entrepreneurship and Innovation

Introduction

The report aims to assess the scope of innovation of Ace Drive, a Singapore-based car rental organization. The efficacy of a successful innovation initiative is often decided by the demands created in the external business environment. The overall nature and scope of feasible innovation within Ace Drive have been assessed based on the shifts in the overall socio-economic trends within the industry.  

Overview 

From the perspective of an organization, innovation can be considered one of the most effective tools to transform the chosen dimensions of a business.  Innovation can be defined as the systemic modification or overhaul of one or more key business dimensions to achieve the strategic objectives of a firm (Chen, Yin & Mei, 2018).  One of the most important strategic objectives of innovation is to ensure the competitive advantage of the firm. The competitive advantage, in this context, may include distinct capabilities in terms of business processes, product attributes, distribution system, among other aspects (Anwar, 2018). Ideally, an organization should aim to ensure innovation based on the demands created in the external business environment. Moreover, the internal resources of the organization also act as a modifying factor of the degree of innovation. The internal resources and capabilities of an organization determine the overall feasibility of innovation. Innovation is often based on an identified range of underlying principles. The discovery principle of innovation refers to the identification of the scope of transformation that has already been present within the business environment (Foss & Klein, 2017). An entrepreneur who is inclined towards seeking opportunity may be the pioneer in identifying the scope of innovation, compared to their competitors. The creation principle of entrepreneurship refers to the establishment of a new range of value propositions through product or process transformation (Li et al. 2020). Disruptive innovation is often based on the principle of creation. It ensures that the traditional model of product attributes or service delivery process is transformed. A proactive assessment of the latent demands, tastes, and preferences of the consumers is considered the basis for transformation. Incremental innovation, on the other hand, refers to the minor modifications in the product or service attributes to adapt to the visible shifts in consumer perceptions. From the perspective of an organization, an accurate assessment of the nature and extent of innovation determines its overall efficacy.

Types of Innovation

To ensure a holistic assessment of the overall degree of innovation that can be introduced in Ace Drive, certain key dimensions need to be considered. The range of dimensions has been identified, based on the respective relevance with the business operations of the organization.

Process Innovation

Ace Drive has adopted the traditional model of rental through a selection of cars, quote negotiation, and service delivery based on consumer preferences. However, over the years, the organization has ensured limited usage of the digital platform. In the current age, digital platforms are being considered as one of the primary tools to ensure significant process innovation, irrespective of the nature of business and industry (Venkatesh & Singhal, 2019). The current service delivery process of Ace Drive, through its website, includes certain core services such as Enquiry, Quotation, and selection of the type of rental, among others. Based on the information provided on the website, the responses of the normal inquiries typically involve 24 hours (Ace Drive, n.d.). This aspect of the process delivery infrastructure reflects the significant scope of incremental innovation. The organization provides a range of inquiry modes including Email, Mobile, Fax, and inquiry forms. The car-rental services can also be integrated with user-friendly mobile apps for enhanced process-oriented innovation. Based on the industry-wide practices, incremental innovation in this context may help to create a significant differentiation, in terms of competitive advantages.

Product Innovation

Ace Drive has traditionally catered to a niche range of markets. The range of product offerings has mainly centered on offering luxury automobiles for special occasions. Moreover, the range of products has traditionally been provided for corporate requirements including hotel and airport transfers, tours, among others (Ace Drive, n.d.). This has essentially restricted the scope of consumer base expansion. The product portfolio expansion, in this context, can be implemented based on the demand created in the external business environment (Snihur & Wiklund, 2019). The current pandemic situation related to COVID-19 has created a significant crisis in the socio-economic environment. Specifically, the transportation of patients and other related emergency transits have become one of the most prominent issues under the current scenario. Ace Drive may tie-up with healthcare facilities to ensure the availability of necessary medical equipment in some of its product offerings for the convenience of the consumers. The innovation, in this case, can be considered incremental. The innovation, in the initial phases, can be restricted to a limited number of cars only. The potential benefits of incremental innovation can be referred to in this context. One of the core benefits is that the product innovation in this case will help Ace Drive to establish relevance with the shift in the socio-economic business environment (Saladino, Algeri & Auriemma, 2020). The modification in the product or service attributes will be by the changing consumer demands. Moreover, the incremental innovation, in this case, will help to create a distinct competitive advantage and brand awareness among potential consumers.

Position innovation

Traditionally, Ace Drive has maintained a usage-occasion-based positioning strategy within the core target market. This implies that the consumers have preferred the services of the organization, based on occasional demands only (Ace Drive, n.d.). However, with the expansion of the product portfolio, the organization can ensure a transition towards a position that is based on the core benefits of the consumers. The benefits, in this case, are based on the assumed need created by the healthcare emergencies which are part of the changing socio-economic environment. Some of the implications of the positioning innovation can be referred to in this context. Through position innovation, Ace Drive can establish itself as an organization that caters to the sustainable social needs of the consumers. This will ideally lead to a distinct brand positioning, as compared to other traditional car rental companies within the industry. Moreover, from a strategic point of view, a positioning based on perceived benefits will ideally lead to frequent usage and preference of the brand (Nadube & Didia, 2018). The traditional model followed by the organization may not provide a consistent source of revenue in the context of the current socio-economic crisis in the business environment.

Paradigm Innovation

Traditionally Ace Drive has projected itself as an organization that prioritizes the needs of the consumers. Paradigm innovation, in this case, will determine the overall shift in the values and attitudes of the management think tank (Edwards-Schachter, 2018). The shift, in this case, will not involve any major transformation, as far as the brand perception regarding Ace Drive is concerned. Rather, the paradigm will be an extension of the overall customer-oriented brand image maintained by Ace Drive over the years. The objective will be to convey that the organization is prepared and well-equipped to proactively assess the changing needs of the consumers and innovate accordingly.

Degree of novelty

The overall texture of innovation in this case can be considered incremental. Strategic tie-ups will be formed to ensure focused modifications of the product and service delivery models (Bouncken et al. 2018). The innovations will not essentially lead to significant transformation or overhaul of the traditional process of service delivery. However, the business environment will ensure the relevance of the innovation model.

Timing

The current socio-economic condition will ideally help in attaining the growth stage, in terms of demand, of the planned innovation processes.  However, there are scopes that the product innovations may reach maturity and decline stages once the current crisis created by the pandemic returns to normalcy. The objective, in this case, will be to sustain product innovation, based on the changing social needs of the consumers, apart from the core offerings.

Role and Implication 

One of the key aspects of implementing the innovation will be the potential correlation with organizational growth. In this case, the relevance of the incremental innovation with the consumer preferences will be one of the core indicators of the efficacy of innovation (Ringberg, Reihlen & Rydén, 2019).  The process innovation, involving real-time communication with the organization representatives with a focus on efficient query handling will be one of the sustainable competitive advantages. The potential consumers will view this attribute as a deciding factor in terms of preferring alternative brands. Moreover, a sustained focus on integrating innovation with social needs will continue to enhance the perception of the brand in the minds of the consumers.

Organizational Context

One of the common characteristics of innovative organizations is the focus on creating a robust and proactive R&D team (Schot & Steinmueller, 2018). In this case, the R&D team will be mainly involved with the proactive assessment of ensuring socially relevant innovation for the existing and potential consumers. Moreover, the focus will also be on assessing ways of improving the overall service delivery paradigm of the organization. The organizational culture and the leadership team can introduce incentives to encourage innovative ideas among the team members (Wu et al. 2019). This can be considered one of the strategies to ensure sustainable innovation culture.

Social Implications

Moreover, in this case, the social attributes created through the innovation will help to strengthen the overall loyalty of the existing consumers. The objective will be to ensure shared value with the consumers (Ketonen-Oksi & Valkokari, 2019). Shared value, in this context, will be significantly reliant on the perception of mutual benefits of the consumers in the long run. The social values, as perceived by the consumers, will include easy access and mobility, especially in times of crisis. From the perspective of Ace Drive, the enhanced consumer loyalty will ideally lead to a consistent source of revenue and positive word-of-mouth. Consequently, this will lead to a higher consumer outreach in the long run.

Conclusion & Recommendation

Overall, it can be concluded that Ace Drive has significant scopes of implementing incremental innovation that covers its overall process, product, service delivery mechanism aspects. One of the primary recommendations, in this case, will be to ensure that the management establishes strategic alliances with relevant third-party experts in terms of its digital platform improvement. Specifically, Ace Drive should aim to ensure incorporating the feature of real-time communication within its website. Moreover, a distinct team of trained consumer care executives can be established to strengthen the implementation of the process. Tie-ups with local healthcare facilities for emergency services will require a thorough assessment of the feasible range of organizations with potential scopes of strategic alliance. Collaboration between the marketing and the management team will be imperative in this context.

References

Ace Drive. Car Rental & Car Leasing in Singapore - Ace Drive Car Rental. Retrieved 14 June 2021, from https://www.acedrive.sg/

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