The Connection Between Demand And Innovation Business Essay

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Consumer needs and preferences are defined as Demand. Demand is one of the key drivers for innovation. Productivity gap can be closed by the innovation. Innovation is centre of UK policy. Innovation is nothing but the 'successful exploitation of new ideas'. A proposition should be viable for ensuring the successful ideas. A balance of supply and demand is required for that. To archive the successful innovation in market we need the proper market condition, proper coasts, and materials availability.

To remain as competitive in this global economy innovation is an essential part. Understanding of the demand side driver's influence is crucial that is because of the structural changes in the economy.

Mechanisms which influence the Innovation:

There are three mechanisms through which the innovation can be influenced by the demands of the users.

Market mediated, through the business markets and the consumers

Co-ordinated and expressing through the governmental.

Directly means by the user modification and the user engagement.

Consumer trends changing and relevance of underlying drivers. There is a visible consumer spending change in the last few decades in a large amount because of the changes in the services cost and the goods real cost.

The affluence levels are rising from the last few decades. Including the levels of education and the credit access. The population now days are ageing and in the labour market so many women are joining. To understand the process innovation, the demand focus has to be improved.

Channels through which demand influences innovation. The needs of the consumer and the preferences of the consumer can influence the innovation service of the product s development at any stage. The market research is nothing but a channel of traditional through which the business can assess the preferences and the needs of their target market.

Nowadays many organizations are working with users also and also the test prototypes. And also user's ideas are exploiting for the new improvements.

By using the internet nowadays the user communities can work together and design new products and develop the new products, and also modification of the existing products.

The business should select the users or the potential users if they use the traditional market research. So those users will gather information. It is a challenging for measuring the knowledge of the employees and the knowledge of organizations. Demand oriented policies have received more attention from the policymakers.

Demand Stimulation:

The demand stimulation can be done in following ways:

Arranging the financial incentives for consumers or the disincentives for consumers.

Providing rising awareness to re address the imbalances the information.

Making things like private users can also understand information which is going to help them which is nothing but competence building.

Standard setting

Regulation setting

Performance regulation

Safety regulation

And also there are user regulations which ensure the users are legally safeguarded in a standardised ways of operating.

And also market conditions which are altered.

Affording in innovation

There is a blurred policy between the difference of the demand oriented and the supply oriented. If the future business changes the regulation, then it is best to avoid the hampering beneficial for the government. Then there is a sufficient time for comply with the new requirements and new rules while making clear in the outcomes , which are not always can be achieved by using the business practices and the existing technologies.


We have to look at understanding of the consumer needs and also preferences, and also the throughout the innovation process, where the information is using, when the interaction of the innovation process with the customer.

There are some different relationships between the business and consumers like: business to business (B2B), and business to government and also business to mass consumer relationships. But the among all these, the Business to business and business to government relationships are more bespoke, where as business to consumer is relationships is going to be more length. These differences are normally make reflection in information about the needs of consumers and also the preferences of the consumers.

To make it simple, they are separated into four main triggers, but they are not going to be mutually exclusive.

Suspected demand, there is a need to met, the consumers' willingness to purchase

Client demand, desire to meet the brief of consumer

Internal cost saving, there is need of organisational costs reducing.

Revenue generation, there is a need of business expanding in order to generate the more income for the companies.

Normally from where all these ideas coming from, for the innovation?

In all organisations the ideas mostly developed by the employees in order to develop the innovation. The findings for the development of the innovation are recollected from the employees, but it is difficult for the origination of the ideas from the consumers, when there is an involvement of the consumer's suggestions.

The identification of the needs and source is done by the organizations in which way?

Some organisations use the systematic process in order to communicate the ideas. Whereas some organizations use process, instead of generating the new ideas. Some organizations strive continuously in order to develop innovation, this is a random occurrence.

Reading of the frame work model?

The ability of the innovation is not presuppose the culture for the motivation of the innovative, and then without any means the willingness will exist. In the innovation, the capturing of the consumer needs and the preferences and the interaction of the organization is done in some processes. Those processes are represented by the Framework. The organizations choose some mechanisms to engage with the consumers is also represent by the Framework. And also the Framework represents

Where the need was, Consumer preferences nature that each mechanism is designed to obtain, which level innovation mechanism is associated with?

The consumer needs and the consumer preferences influences:

There are some ways in which user fed consideration into the innovations, which are following as

On the shop floor

Client interaction by speaking

Scanning of market

Blue-sky thinking

Feedback of customer

Days on the shop floor:

In this the interaction occurs with the consumers or users at the front line of the organization. The decision is taking by the management in this way. They do spend the time by meeting the customers or meeting outside of the company, where as they are working directly with the consumers.

Client interaction by speaking:

This happens in the organization which has close individual relationship with client in a small number. But it won't happen in a mass number of consumers. For the good understanding of the user needs and preferences, the direct conversation will help the employees. This is good mechanism for the consumer needs feeding into the goods and services.

Market scanning:

Nowadays most of the organizations are involving in market scanning.

Blue-sky thinking:

There are so many innovations are resulting from the blue-sky thinking.

Customer feedback:

The customer feedback makes better improvements in the organization. It can be happened by getting the suggestions from the customers by which they can be satisfy more and which makes them to like the company more and more. But this influences the business in smaller change and it happens so rarely.


The consumer preferences and the consumer needs are feeding into the business organizations through different mechanisms. This can be revealed by the Framework. The revealing analysis pattern is as follows:

The innovations of the incremental response is happening directly to consumer needs and consumer preferences, as a result of short term consumer needs and preferences are feeding into the organization through the speaking with clients, talking to them in the shop floor, by considering the customer feedback, interaction or customer feedback.

The Innovations of the radical response or larger response is happening to the consumer needs and the consumer preferences , as a result of the long term consumer trends, which are feeding into the organizations through the scanning of market and blue-sky thinking or speaking to the clients.

Failed innovations: the failing of innovations happens because of improper understandings of demand, which means if there is no proper understanding of the consumer needs and preferences, the failing of the innovation happens.


The opportunities are missing by the organizations, which are helpful for the insight advancement to increase their competitive advantage.

If the consumers and the government are educated in order to understand about the innovation of demand and also the improvement of the communication lines.


I found mainly some recommendations for the organizations as well as for policy makers:

Establishment of relational interaction

Proactively management of the relational interaction

Searching for the consumer needs and consumer preferences.

Fixing the demand into the process of the innovation.

It is important to understand that with the success of the innovation, there is a possibility of enlarging the users and also enlarging the capabilities of the users.

Here is a review of findings and some recommendations for the business organizations and also for the policymakers

Reviewing of the economy changing, actually, which insights can be provided by our Framework, and also we can draw some conclusions of the firm from our findings. The knowledge based economy can be understood by our Framework with the rise of the assets which are intangible and changing of the consumer demand.

The policymakers and organizations have to move far from looking at the consumer buying behaviour of the demand. The process of the public procurement should be including in suppliers learning. Policy makers have to move the organizations to the higher positions in order to awareness of the policies aimed at the individual behaviour changing.