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Table of Contents
Background of the company
Critical analysis of innovations with Tidd and Besant’s innovation model
Identification and Analysis of internal resources
Analysis of organizational culture on innovation
Reference List


This report is mainly preparing to address the guidance of innovations and their requirements. Innovation is a significant way to bring growth to the organization. Innovation has different meanings. Innovation does not mean that every time a company needs to bring something different ideas for their customers. Innovation can also consider when a company upgrading its existing services by adding extra features. Nowadays, every company wants to be sustainable growth, therefore innovation also needs to be environment friendly. This innovation has some appropriate stages. There are some innovation process models and Tidd and Besant’s innovation model is one of the best. This report is mainly preparing to show how innovation is getting success, what route they followed. This report will talk about a fashion retail company, named ASOS PLC. The company has some innovative ways to serve their customers and also gain profit. Apart from this, there will be a detailed analysis of the importance of internal resources in innovation management. The report will also discuss the potential influence of the organizational culture on managing the success of innovations. 

Background of the company

ASOS PLC is one of the biggest companies in the fashion retail industry. The company is working only on the online platform. ASOS is a public limited company and it has no physical stores. The company claims that they have a huge number of collections and it is not possible to show all of their collections in one physical store, rather they focused on the online platform only. They have their website and currently, they also developed their smartphone application for Android and iOS devices. The company has its headquarters in London, UK. The company has more than £3.15 billion in revenue and its net income was 25 million euros as of 2019. At present, they are providing their services in almost 240 countries globally. They are distributing from their Germany, USA, and UK distribution centers. The company has more than 4000 employees at present. They are selling more than 850 brands of products and also their designer clothes.

Critical analysis of innovations with Tidd and Besant’s innovation model

There are many innovation process models available to analyze an innovation but Tidd and Besant’s innovation process model is the best form of innovation model as it is the most simplified model of innovation (Tidd and Bessant,2018). Four innovation stages are needed to be followed by all the organizations that are seeking innovation. These stages are search, select, implement and capture.

Innovation 1: Virtual fittings room

ASOS is one of the leading fashion retail companies in the UK and serves globally. However, they have no physical stores. It has many advantages like they can present a lot of choices to their customers, customers no need to present physically and it is time-saving. While it has some disadvantages also and that is considered its weak points. One of the issues is regarding the trail room. Almost every fashion retail industry has a trial room in their offline stores where customers can see their look with their choices. ASOS has not had this option for a long time. After a long time, they can discover a virtual fitting or trial room. Now their customers can easily take the benefits of this, they just need to upload their full-frame image and need to choose their clothes. They can see them on their preferred choice. This is a really big innovation by the company and it looks like necessary after discovering this. 

The first phase of the model refers to searching. It defines the environment of the organization, both internal and external factors to understand the threats and opportunities of the project. Here a strong team working is required which is the complete route guide (Talukder,2014). There are several threats related to legal issues, technological issues. In this case, the company is going to implement a service that can provide a fitting room-like environment virtually. Therefore, the project team needs to analyze whether any data protection Act is not harmed (Keresztes & Endresz,2020). Companies need to be very sure that there is no chance of misusing the images of their customers. Apart from this, there is another thing related to technology. The project team confirmed that it will launch on a few devices like iPhone 12 etc. Therefore, there is a question of opportunities. The planning team confirmed that a lot of people in the UK, USA, and Germany are using this kind of smartphone. Therefore, it will increase their profit and bring innovation. 

The next phase of the model is select. The selection refers here to what opportunities the company needs to choose to pursue. When the project planning is complete, it can be easily found which opportunities the company will have after the success of the project (Kuratko et al., 2001). But an analysis, evaluation, and decision making are required on which opportunities the company chooses to pursue. Because it is not possible to get all the opportunities. Therefore, ASOS decided to analyze the opportunities and then they select their opportunities that have minimum uncertainty and minimum cost. That is why it is not possible to bring this feature to all kinds of smartphones due to the high cost. Here is another thing, which is the risk assessment (Salah,2017). The company focused on the risk assessment at this stage to avoid uncertainty. 

After generating the concept of the innovation, now it is the most important stage that is implementation. After generating the idea, calculating the risk it is important to develop the idea (Kuratko et al., 2011). Here the company focused on the strong team working again. The company primarily made a couple of departments. The department did its task as per the blueprint developed by the planning department. The leaders need to take decisions as per their risk level and investment. The marketing, IT, engineering, and R&D department worked together to implement the innovation. 

in the role of the last, however important, phase that is described is Capturing of value. This last phase is about identifying the market influences. After this innovation, the company reviewed its market growth, value increase, and brand awareness increase (Beharry & Fai Pun,2020). The results show the project increased its business by more than 26% in the time of COVID-19. 

Innovation 2: Machine learning-based demand forecasting. 

This is another great innovation done by the company and present in the market. The company first introduced this technique to analyze the market demand. However, there are some theories and models to analyze the market demand. But that is not highly accurate. This machine learning-based demand forecasting technology is highly accurate and almost cent percent able to give forecasts about the demand in the market. Companies like Amazon, Tesco are also using this technology invented by this company. 

According to Tidd and Besant’s model, the first phase that is search refers here to an analysis of the internal and external factors of the innovation. The company noticed there is no such impact of external factors except the technology. The main thing is depending on the internal factors (De,2002). The company agreed that they have required a very strong research and development team and further a marketing team. Therefore, they focused on the human resource department more. 

The next phase shows the requirements of project planning as it needs to understand what opportunities are needed to choose. The planning department if the company revealed that the biggest opportunity is that company can avoid unnecessary production. According to a current report, almost 75% of people are buying clothes in the UK to try a new kind of design. Therefore, this market forecasting application can save costs and also helps to keep a balance between supply and demand. 

The next phase of the model analyzes how the company implemented the strategies to develop the idea into reality. First of all, they assess all the possible risks of the project and then decide the budget of the project. After that, leaders made their decisions and the company started to implement the idea. In this stage both risk assessment and team working were important. 

The last phase is the capture where the market growth, revenue increase, and influence in the overall marketplace have been analyzed. Due to the covid-19 situation, almost every company in many sectors has a great loss. In that time, this machine learning-based demand forecasting application helps the company to avoid uncertainty. They manufactured only those quantities and got a good result. They also acquired knowledge of innovation that can be used in future projects. 

Identification and Analysis of internal resources

Analysis of internal resources is a part of internal analysis. Companies need to do such activities. It lets them help to analyze their power, their capabilities, their activities in organizations (Davila et al.,2012). It is very important to have strong internal resources before the innovation process. Without proper resources, innovation could not get success (Cagan,2012). These internal resources include financial resources, human resources, and physical resources. 

Financial resources

This is the most important resource that has been needed to bring innovation. The size of innovation, the capacity of the opportunity decides how much investment is required to establish the innovation. There are different needs for the financial resources such as taxation, wages of those people who are hired during the project, physical resources, Investment in the research and development department, and many more. There are different sources of finance is available for the ASOS PLC. First of all, it can use its business profits which is enough to bring their innovation. However, the business has different risks, any time it can face trouble from any side like heavy damage in manufacturing devices, big loss of selling, etc. Therefore, this company uses its shares. ASOS is a public limited company, therefore they can use their share values. This is the internal source of finance, there is another choice that external finance investment. Most of the company’s do this. There are some private investors, or they take loans from banks or financial institutes, etc. 

Human resources

Human resources are the best assets of an organization. They are only responsible for generating the ideas, finding the opportunities and threats, implementing the idea into reality, and influencing the market. Therefore, it is very important to have a strong team of employees (Preenen et al., 2017). A lot of companies remain as small companies or operate in a local area due to lack of human resources or in other words, lack of intelligent employees. ASOS has a very innovative range of human resources in different departments. ASOS does not give focus on the quantity of the employees rather they focus on the quality of the employees. Therefore, they hire a minimum number of employees, but those who are hired are truly innovative persons and have boundless curiosity (Prange and Pinho,2017). During the innovation, in every stage, innovative people will be required. They are required from the research and development department, finance department, marketing department. 

Physical resources

After collecting the financial and human resources, the third most important thing is acquiring physical resources. The above discussed two innovations are related to technology development. Therefore, it needs some special sensors, some application tools, some software, and data protection applications. The company needs to provide a centralized R&D laboratory where it can work on the project. ASOS has their R&D laboratory in their London headquarter. They have a well-set-up functionality, well-organized platforms for testing the application if something else is needed whenever the R&D group informs the project head, it is sent to them. 


It is true it is not a part of internal resources but without leadership, a company will not be able to bring innovation. Leaders are those who run the business from their heart and mind, but directors are only thinking with their minds. Leaders are the only people who can encourage their employees about innovation, leaders are responsible to deliver the message to their employees that they are the most valuable assets and only responsible for bringing innovation (Fonseca et al., 2019). It increases the energy, potentiality, and productivity of the employees. Also, a leader is the only person who can think innovatively to serve customers. They are also responsible to convince investors to bring financial resources. 

Analysis of organizational culture on innovation

There is a deep influence of organizational culture on bringing innovation. First of all, the difference between efficiency and effectiveness needs to be understood. Efficiency defines the right way or manner to complete a task. Efficiency means completing a task in the right manner while using fewer resources. On the other hand, effectiveness defines doing an accurate task. Both are depending on the organizational culture as organizational culture accomplishes with style, the working environment of employees, and leadership style. Effectiveness is strategy formulation and efficiency is strategy implementation. The strategy implementation and resources used are needed to do efficiently to get an effective innovation. 

Innovation is deeply promoted by the organizational culture. If the working environment is innovative, if they are allowed to communicate freely, if they allow people for boundless curiosity then the organizational culture is suitable for innovation. An innovative culture always encourages experimentation. They always need to do something different that gives them a unique identity. But there are risks of experimentation (Shahzad et al., 2017). A suitable innovative organizational culture is always ready to face risk. If the company is ready to accept both success and failure and can celebrate the mistakes then only the company can move towards innovation (Zeb et al., 2021). If these conditions are satisfied then, there will be a clash between the project members, leaders if the project consists of mistakes or the project fails. 

The organizational culture of ASOS PLC is too supportive of innovation. The company has a tolerance of impractical. They allowed their employees to ask foolish questions and leaders did not discourage them. They think impracticality might also lead to innovative solutions. Apart from this, the company has a strong tolerance for risk. That is why they encourage their employees to do experiments. The investors and other shareholders are also very much convincing about the innovation. The company cleared the vision and objective of the projects and focused on the ends rather than on means. The company also tolerated conflicts during the project as they allowed for diversity of opinions. 


This report is mainly prepared to understand the importance and factors of innovation. ASOS PLC, one of the leading fashion retail companies has been chosen to perform the task. Two innovations have been identified that are present in the current marketplace. These two innovations are virtual fittings room and machine learning-based demand forecasting technology. Both the innovation has been critically analyzed with the support of Tidd and Besant’s innovation process model. It has been found that it is the most simplified way to analyze innovation. There is also identification and analysis of internal resources that are required to get a successful innovation. ASOS is using its resources efficiently and now they have effective results. The report has ended with a discussion on the importance of organizational culture in promoting innovation.

Reference List

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Cagan, J., Volgelm, C. (2012). Creating breakthrough products: Revealing the secrets that drive global innovation, 2nd Ed’,, Pearson Publishing.

Davila, T., Epstein, M, Shelton, R. (2012). Making innovation work: How to manage it, measure it and profit from it, Updated edition, Pearson Publishing.

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Keresztes, G., & Endresz, M. G. (2020). Innovation and models of innovation: A brief insight into the definition and different models of innovation. Innovations8(2), 53-55.

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Shahzad, F., Xiu, G., & Shahbaz, M. (2017). Organizational culture and innovation performance in Pakistan’s software industry. Technology in Society51, 66-73.

Talukder, M. (2014). Managing innovation adoption: From innovation to implementation, UK: Gower.

Tidd, J. and Bessant, J.R. (2018). Managing innovation: Integrating technological, market and organizational change, Chichester: Wiley.

Zeb, A., Akbar, F., Hussain, K., Safi, A., Rabnawaz, M., & Zeb, F. (2021). The competing value framework model of organizational culture, innovation and performance. Business Process Management Journal.