Organizational Similarities and Differences in their Innovation Strategies
Organizational Similarities and Differences in their Innovation Strategies and Final individual project: a comparative study of two organizations in the same area
with respect to the similarities and differences in their innovation strategies and
activities. In your analysis you should use concepts learned in the course. Could you send me a text when you decide the topic? please try to pick big organizations. The ppt i attached is the course material, and i highlight some critical points we could use in the paper. Thank you. and please use as much as data and resources you can, that is the most important.
Organizational Similarities and Differences in their Innovation Strategies and Activities
Organizations adopt and develop innovative strategies that share differences and similarities regarding their structure, implementation and key elements of such innovation. Organizations adopt innovation that enables them to easily and efficiently achieve their goals and objective. The similarities in the innovations happen based on the innovation available in the environment while the difference in the innovations adopted as an organization competes for customers and in an attempt to increase profit and revenue levels. Innovations entail the adoption of new and creative ideas in business and organization to enhance operations and implementation of different mandates. The innovations are incorporated into business strategies, managerial tactics, and operating practices. Innovations are vital aspects of any organization as they enhance competitive advantage and effectiveness in the organizational operations. Innovations enable competitive advantage as it leads to an increase in sales, enhances the protection of innovations, and enhances efficiency in the manufacturing process. Equally important, there are differences and similarities in the course of implementation and adoption in organizations operating in a similar business environment such as in the case of Walmart and Amazon. Amazon and Walmart are the biggest retail players that operate in a similar environment but they adopt innovations that share similarities and differences in the course of doing business.
Similarities and differences in the innovations adopted by Walmart and Amazon
Amazon and Walmart are great rivals in the retail business are ever competing to win customers across the globe to win customers by adopting different innovations that are either similar or different. Innovation in the case of the two rival retailers entails the use of the available and new technology this the similarities and differences in technology (Nalchigar et al., 2016). In this regard, both Walmart and Amazon adopt the process type of innovation in approaching the market. Process innovation, in this case, entails the change in the way that the business conducts its activities such as presenting its product to the market as opposed to the product innovation that takes the actual change of the products. In this regard, the two organizations use the internet platform to market and present their products to the market. The online marketing has proved to be successful thus earning both the organization’s profits and revenues. Walmart’s online presence is felt through its websites and various social media platforms while Amazon’s presence online marketing is seen through Amazon Go and on different social media platforms.
Amazon and Walmart have consistently used innovations to have its way in the market. However, Walmart adopts a market breakthrough type of innovation while Amazon uses the technological breakthrough innovation to appeal to the market (Cavallo, 2018). In this case, Market breakthrough technology entails the use of core technology that is the same as the existing product but does not give high customer benefits while technological breakthroughs use different technology than the existing products but do not give superior benefits to the customers. Therefore, the market breakthrough type of innovation makes Walmart have a large presence in the market by opening more spaces to reach its customers while Amazon’s consistent technologic breakthrough innovation makes the organization continuously increase its online presence by making many investments in different online platforms. Therefore the different types of innovations that make an organization appeal differently to the physical and virtual market thus having considerable impact.
The activities of Walmart and Amazon can be evaluated from the dominant design adopted to determine the similarities and differences in the designs. The dominant design entails a distinctive manner of offering generic services that have gained and maintained the highest level of market acceptance for a considerable period (Kumar et al., 2012). Initially, Walmart being the oldest player in the market adopted a single dominant design in reaching the market though physically opening branches across the globe to reach as many customers as possible for their different products. The entrances of the Amazon in recent times have introduced several divergent designs to approach the market. In this case, Amazon adopted the online platforms and physical presence in the market thus registering growth and an increase in profit and revenues. Amazon stepped its presence in the market thus inclining Walmart to follow suit and adopt different divergent designs to reach customers across the globe just as in the case of Amazon. Multiple dimensions shape the technology to the position of gaining the position of dominant design. Additionally, the strategies adopted by a firm give rise to different dimensions that together for the dominant design of approaching and handling the market. It is important to note that dominant designs attract a wide customer base thus ensuring that businesses can effectively growth to high levels of success.
The activities of Amazon and Walmart are customer focuses to ensure that both organizations gain a wide base of customers across the region. This approach has made e-commerce organizations to make great investments in customer-focused and experience culture (Bustillo and Fowler, 2009). Amazon has consistently been highly rated by the American Customer Satisfaction Index scoring 82% while Walmart scores 74% as per the ACSI survey conducted in 2018. The survey shows that Walmart lags due to differences in activities and programs adopted concerning focusing on the customers. The differences are the results are because Amazon programs are obsessed with customers’ needs while at Walmart the business just makes emphasis on customer satisfaction and experience. The updates by the store, website layout and the mobile experiences are modeled to ensure that customers have an easy time in the course of shopping and other related activities ensure that Amazon remains at the top. Therefore, Amazon activities and programs are based on customer centricity thus customers end up receiving exemplary digital experience and convenience.
Amazon and Walmart use different technology and innovations in their operations but at the point of adopting them, they are faced with the dilemma of buying or building them. The task of buying or building the technologies and innovation comes with their shares of advantages and disadvantages that influence the strategy to be adopted (Wan, 2006). Therefore, the decisions to buy or build are strategic decisions with substantial implications for the organizations. Amazon and Walmart have made a significant investment in digital growth. It is important to note that Walmart prefers to procure technologies from third parties as opposed to the building while Amazon prefers to build its innovations and technologies. The decision to buy of the build is influenced by different factors that include trends, preference of in house solutions, the rise of technology vendors and consulting organizations, generalization and customization needs, and the cost and risk reduction needs. The organization’s decisions to buy or outsource a technology or an innovation is highly dependent on the fact of the competitive advantages of every option. In this case, Walmart has outsourced the services of developing the Walmart App, re-tooling the app and acquiring different digital offerings to enhance the advanced customer solutions. On the other hand, Amazon has developed its Amazon Web Services, Amazon Pay, B2B, and B2C digital solutions. These solutions are in the house and have ensured that Amazon has a great online market presence that reaches customers with a wide customer base. Therefore, both Walmart and Amazon have different technologies but adopt different strategies in acquiring and using the technologies in the interest of their businesses.
Amazon and Walmart have a physical presence in the market that determines their retail presence. Amazon and Walmart strive to increase their physical presence across the region to ensure that they increase levels of profits, revenues as well as customer loyalty. Walmart has been at the forefront due to the high number of stores it has across the region that makes it possible to make a great physical footprint in the market. Walmart has been increasing its stores from time to time thus making it possible to be always ahead in physical presence. On the other hand, Amazon’s physical presence remains behind despite the efforts to increase their stores and the acquiring of Whole Food stores. Additionally, Amazon makes delivery to customers through Amazon Prime Now and Amazon Fresh. The difference in the physical presence has resulted in wide differences in the money earned in 2018 as Amazon earned $20 billion in grocery while Walmart earned $270 billion in grocery. Therefore, Walmart dominates in the physical space and has consistently increased its retail presence.
Walmart and Amazon are both faces with projects that need critical decision making. The power and efficiency in decision making between the two businesses influence the levels of success attained as well as their competitive advantage in the implementation of projects such as in the acquiring or development of new technologies and innovations (Kumar and Claudio, 2016). New projects in the organization are developed to increase revenue levels, delivering new products to the market and reduction of cost of operation or production thus ensuring that organizations have a bright financial and economic future. Walmart has a complex structure of decision making as compared to Amazon that makes amazon grab at any business opportunity or technology or innovation in the market and implements it in the interest of its business prosperity. The effectiveness in decision making by Amazon can be displayed from its logistics and supply chain operations. For instance, Amazon made a prompt decision to be shipping goods for its prime members thus making it easy to achieve high levels of success. Additionally, upon breaking up with FedEx Amazon decided to build its fleet of planes and trucks to enhance the transportation of goods. Therefore, the decision and capability of Amazon to streamline its supply chain within a short time by coming up with fleets to deliver goods within a day show their effectiveness in decision making. In the case of Amazon making and implementation of decision takes a long time proving inefficiency and thus being unable to grab business opportunities in good time. Therefore, effective and efficient decision making in an organization is a critical aspect that determines the success and e3fficnecy in operations.
Walmart and Amazon have different technological innovations that require funding to ensure they are developed and implemented in the market in the financial interests of the organizations. Projects need to be funded to facilitate different expenses that are incurred such as salaries, cost of equipment or pay licenses (Cavallo, 2018). Walmart funds its operations and innovations through the sale of shares at the NYSE and retained profits. This approach ensures that Walmart is in a position to engage in operations that require huge amounts of money. On the other hand, Amazon funds its projects and innovation from retained profits from the different services offered thus making Amazon not to make major investments but thrive using their low pricing structure.
Amazon and Walmart have a wide range of similarities and differences in the innovation strategies adopted as well as their activities in the interest of meeting the business goals and objectives. The strategies and activities adopted by different organizations aimed at ensuring that businesses increase their competitiveness. Businesses operating in a similar environment keep on competing for strategies and activities in the course of implementing business policies to ensure that they can compete favorably and in the process similarities and differences arise. The similarities and differences between Amazon and Walmart can be evaluated on the basis of the type of innovation adopted, process of innovation used, the dominant design adopted in handling business processes and activities, the organizational level on the customer focus and satisfaction, the decision on buying or building innovations and technologies, the levels of physical presence in the market, the process of decision making and the sources of funding innovations and activities in the organization. The differences and similarities in innovations and activities determine the growth and success recorded by the different organizations in the course of their competition in a similar environment.
Bustillo, M., & Fowler, G. A. (2009). Wal-Mart sees stores as online edge. The Wall Street Journal, (B1).
Cavallo, A. (2018). More amazon effects: Online competition and pricing behaviors (No. w25138). National Bureau of Economic Research.
Kumar, F. P., & Claudio, D. (2016). Implications of estimating confidence intervals on group fuzzy decision making scores. Expert Systems with Applications, 65, 152-163.
Kumar, S., Eidem, J., & Noriega Perdomo, D. (2012). Clash of the e-commerce titans: A new paradigm for consumer purchase process improvement. International Journal of Productivity and Performance Management, 61(7), 805-830.
Nalchigar, S., Weber, I., Lak, P., & Bener, A. (2016, July). A large-scale study of online shopping behavior. In Proceedings of the 20th International Database Engineering & Applications Symposium (pp. 290-295). ACM.
Wan, Y. (2006). Comparison-Shopping as an Emerging Channel to Increase Web Visibility for SMEs in the United States. In Global Electronic Business Research: Opportunities and Directions (pp. 214-237). IGI Global.