Reasons for Innovation in Entrepreneurial Organizations (Essay Sample)

Reasons for Innovation in Entrepreneurial Organizations
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Reasons for Innovation in Entrepreneurial Organizations
Ordinarily, an organization’s propensity to deploy situational corporate strategies determines its survivability in today’s conspicuously competitive world. The need for such measures is more acute in entrepreneurial organizations, where disruptive thinking and opportunism arguably take center stage. Typically, such organizations effectuate their corporate goals by establishing a resilient entrepreneurial culture, which provides the foundational framework for integrating continuous innovation. Often, innovation at the entrepreneurial level encompasses engendering new ideas and ingenious upgrades to the organization’s existing product lines. Resultantly, innovation is indispensable in entrepreneurial organizations, particularly because of its inimitable potential to generate multiple enterprise benefits.
One of these benefits is augmenting the entrepreneurial organization’s capacity to penetrate new markets faster. According to Buciuni and Pisano (2021), a company’s market penetration efficiency is critical to its aggregate corporate influence. However, it is increasingly challenging for entrepreneurial organizations to guarantee effective market penetration, mainly because of burgeoning competition. Consequently, organizations habitually encounter marketing drawbacks like insufficient market reach and unresponsive customers regardless of expending significant resources to promote products and services. Nevertheless, these drawbacks are mitigable through innovative techniques like price adjustment, augmented promotion, and upsurge usage, ensuring a quicker and more efficient market penetration process.
Additionally, innovation is critical in entrepreneurial organizations because it facilitates significant overhead reductions. Pyka and Lee (2021) posit that escalating operational expenses remain one of the foremost impediments against entrepreneurial success. In most cases, entrepreneurial organizations operate on the fringes of conventional business practices. Consequently, these organizations internalize and perpetuate incessant risk-taking, which manifests in revolutionary goods and services. Usually, each novel product goes through a rigorous conception, design, and testing phase, incurring significant overheads. However, an innovative entrepreneurial process can devise neoteric strategies like maximizing reusability and eliminating procedural bottlenecks to reduce costs.
Moreover, innovation is imperative because it promotes growth in entrepreneurial organizations. Although comparatively tenable, many organizations often fail to realize sufficient growth, mainly because of generalizing expansion objectives (Galindo-Martín et al., 2021). Resultantly, the possibility of corporate stagnation increases markedly, exposing the organization to several repercussions like a decline in sales, substandard economic output, and an acute absence of stock market highs. In most cases, these factors significantly stifle the organization’s likelihood of realizing persistent growth. Nevertheless, innovation possesses the requisite capacity to alleviate these issues, including the ability to identify growth strategies like appropriate asset acquisition and revenue increment approaches.
Furthermore, innovation is necessary because it enhances talent attraction in entrepreneurial organizations. Faghih (2019) observes that attracting and retaining a competent workforce is essential for an organization to attain optimum performance. Customarily, most organizations rely on standard work practices to boost organizational performance. While effective, such a methodology is comparatively detrimental because it rarely encourages employee creativity and erodes the