Strategic Innovation at HelloFresh

Introduction

Innovation management provides an opportunity to the organisations to grab the future market opportunities of the business and expand the business activities across the international nations so that through innovation and creativity, the leaders and manages of the multinational corporate firms can develop creative ideas and strategic planning to establish the business efficiently in the market (Goffin and Mitchell, 2016).

The aim of the study is to analyse the innovation strategy and evaluate the ways the business leader can implement in the business. In this regard, the innovation strategy of the company Hello fresh will be evaluated through which it is possible to acknowledge the strategic planning of the organisation in serving the customers with better products and services. In this regard, for evaluating the innovation strategy, the blue ocean theory is being evaluated which in turn helps to understand the strategic planning of the leaders and the managers of the organisation Hello fresh to develop effective innovative strategic planning and creative ideas to serve the customers proficiently. Through the blue ocean theory, it is easy to analyse the strategic planning of the corporate firms to enhancing their performance through innovation and creativity so that they can satisfy the customers and strengthen their customer’s base successfully. The blue ocean theory is effective to analyse the ways to conduct market research, develop organisational strategic planning and improve organisational innovation through which the organisations try to enhance their performance and establish the brand in the market.

Organisational background

Hello fresh is an international publicly traded meal-kit organisation, established in Germany. It is the largest meal-kit provider in the United States where the company is efficient to provide quality food products to the customers according to the needs and preferences of the consumers in the market. The company is successful in strengthening their customer’s base and enhance their performance in the market for improving the profitability and sales volume of the company. In this regard, the company is also successful in expanding their business across Canada, Western Europe, UK, Australia and New Zealand, which provides a scope to the firm to explore more market opportunities and gain high market share in the food product market. The organisation is efficient to maintain the quality of food delivered to the customers in order to satisfy the consumers in the market by delivering quality products and efficient services according to the needs and preferences of the buyers. It is necessary for the organisation to grab the market opportunities and explore new scope for further expansion through innovation and creativity (Hello Fresh, 2019a).

The organisation is proficient to take care of the customers and acknowledge their actual choice ad preferences making the preparation of the food so that it is possible to maximise the satisfaction level of the consumers. The revenue of the company Hello fresh in the last year was €1.28 billion which indicates that the company has the potential to explore more market opportunities and develop creative ideas and enhance their innovation to establish the organisation in the market. It is leading organisation in global providers of fresh food at home and the company aims at providing each and every household in 11 markets with the opportunity to enjoy wholesome, homemade meals with no preparing, no hassle and no shopping. The company focuses on delicious meal everyday for the customs where the company is conscious in developing proper planning, carefully sourced and delivered the fresh food to the customers where the consumers can enjoy healthy and safe food items at home. The vision of the company is to change the way people eat forever where the company delivers more than 54.7 million meals to over 2.04 million households across the international countries (Hello Fresh, 2019b).

Blue ocean theory of innovation

The core idea of blue ocean theory is to make the competition irrelevant and create new market space for conducting the operational activities strategically to strengthen the customer’s base of the business and achieve success in near future by securing future sustainable growth. As per the blue ocean theory, the organisation creates new market space where the leader and managers can operate in the market with innovative ideas and creative strategic planning (Martín-de Castro, 2015). Making the competition irrelevant is necessary according to the blue ocean theory where through generating new innovative market space, the company can offset competition and reduce the threat of new entrants and substitute products in the market. This in turn helps the firm to develop effective strategic planning of the business and grab the market opportunities successfully. creating and capturing the new demand is also necessary under the theory of blue ocean where creating the demand by developing new innovative products and services in the market and attract the audiences at the market is beneficial for the organisation to establish the brand and gain high competitive advantage through expanding their business and fulfilling the market demand (Mahmoud-Jouini, Midler and Silberzahn, 2016).

The blue ocean theory breaks the value cost trade off where the firm minimises the cost of operations and production of the products and services as well as create better value for the customers efficiently by raising and creating the elements that have been offered to the customers (Dereli, 2015). Hereby, the strategy of minimising the cost of the products and services as well as the maximisation of the values for the customers will be effective for the organisation to grab new market opportunities and establish the company successfully in the market. The creation of Blue Ocean is about driving the costs down while simultaneously driving the value up for the buyers in the market. For this strategic planning, the customers can make effective purchase decision for the organisational products and services as well as can buy extra units of products or services as the cost of products is lower as compared to the substitute products available in the market (Hakansson, 2015). Moreover, the values of the customers can be maximised as they get quality products and services from the organisation at effective price that represents the quality and quantity of the products. Hereby, as per the theory of Blue Ocean, value innovation is one of the effective innovations of the corporate firm to create new market space and grab the market opportunities by attracting the audiences at the market and influence the demand of the whole market across the international borders (Baxter, 2018).

Aligning the whole system of the firm’s activities with the strategic choice of differentiation and low cost is one of the major contributing factors behind the success of the firm, where the organisation focuses on product diversification as well as minimise the cost of the operations in order to set the effective price of the products and service so that the customers can afford the products. In order to develop blue ocean theory in the firm, it is necessary to conduct market research for focusing on alternative industries and competitive position of the business as well as redefine the industry in order to understand the trend of the customer’s choice and preferences in the market (Cooper, 2016). Under the blue ocean theory, the corporate firms are looking for complementary products and services for offering the best possible products and services to the customers so that it is possible to improve the satisfaction level of the buyers. The participation in the market and reshaping the market demand through analysing the external trends over time will provide inopportunity to the firms to develop effective innovative strategic planning to satisfy the customers and create values for them so that it is easy for the organisations to strengthen their customer’s base and secure future sustainable development.

Evaluating the theory in organisational context

In the context of innovation management, the blue ocean theory is effective for the organisation Hello fresh in order to improve their performance in the market and provide the best possible products and services to the customers. according to the blue ocean theory, there needs to create market space and the company Hello fresh is efficient to create market needs where according to the market research, the leader of the business found that, the customers recently needs food product at home where they are interested in online shopping. In the recent era of digitalisation, people are interested in making effective purchase decision through online activities as well as expansion of e-commerce industry the customers are influenced to make purchase decision by one click option from home after seeing the alternative products and services, offered by the organisation. In this regard, the organisation tries to grab the market opportunities and provide the home made food items to the customers within effective team. The company mainly focuses on meal-kit which attracts the audiences in the market. Under the meal-kit, the organisation aims at preparing the food with safety and by using fresh food so that the customers can stay healthy (Hello Fresh, 2019b).

Making the competition irrelevant in the market is important as per the blue ocean theory and in this regard, the company Hello fresh tries to offset competition in the market and Hello fresh is successful in becoming the largest organisation providing meal-kit (Hello Fresh, 2019c). In this context, the company focuses on delivering quality products at affordable price, where the company minimises the cost of operations as well as lower the cost of production in order to deliver the food at effective price so that it is possible for the company to create values for all the customers in the market. In addition to these, creating and capturing the new demand is necessary for the company where as per the blue ocean theory, it is beneficial to grab new market opportunities and retain the long run customers successfully. The company Hello fresh in this regard is proficient to retain more clients across the international markets where the availability of the products and efficient services of the organisation further tracts the customers in the market. In addition to these, as per the blue ocean theory, the company is able to strengthen their supply chain across the international markets where the suppliers and distributors are efficient to distribute the food products safely at home within effective time (Hello Fresh, 2019c).

The leader and the managers develop suitable organisational culture by improving the partnership working practice where all the staff members, suppliers and warehouse managers are proficient to collaborate with each other and meet the needs and preferences of the customers. The safety and security of the food items are managed well in the organisation as well as the staff members are efficient to provide quality service to all the customers where loyalty and trust can be improved through the strategy of customer relationship management. For innovation and creativity, the organisation develops their website for the customers so that the consumers can view the options available in the meal item and choose the best item according to their choice and preferences. This is one of the effective innovations to motivate the customers and retain them for long run where the customers can make effective purchase decision through the company’s website as well as make the necessary payments in the website through transfer of money. The company is also efficient to manage the database o the customers protect the personal information of the customers where the customers can share their banking details for transfer of money against the purchase of food. Hereby, the company is efficient to break the value cost and minimise the cost of the products and services, offered by Hello fresh on order to create values for the customers in long run (Hello Fresh, 2019c).

Recommending future innovative ideas for the organisation

The above mentioned strategic planning of the organisation Hello fresh is effective to make the brand innovative where the creative ideas of delivering the meal kit items to the customers are effective for the brand to expand their business across the international market and secure future sustainable development successfully. In this regard, it is necessary to have more innovation to make the competition irrelevant and be the largest food supply chain in the market. In this context, the company needs to focus on quality raw materials and the way of preparation of the food. In the recent years, people are more conscious about their health and they prefer healthy food items in their meal and thus it is necessary for the organisation Hello fresh to include healthy food items in the meal so that the customers can have option to choose as per their choice and preferences. Moreover, the preparation of the food items need to be considered and the preparation need to be healthy with low quantity of oil usage and usage of fresh foods items and ingredients so that the taste of the food items can be maintained.

In addition to these, the organisation Hello fresh needs to develop green supply chain as recently people are concerned about environmental sustainability and in this regard, the company needs to utilise the electric cars for bulk amount of orders and warehouse management that helps to reduce the greenhouse gas emission. This would be effective initiative for the organisation to create corporate image and provide positive environmental footprint and it in turn helps the organisation to improve trust and loyalty among the customers and strengthen their customer’s base. Moreover, the customer services need to be improved through continuous communication over telephonic or managing customer feedback where the organisation seek to get proper feedback from the customers on the company’s webpage after placing order for their products and services. This improves the customer’s relationship as well as it provide more innovative ideas to the leader for improving business activities as it helps to acknowledge the actual preferences of the customers, satisfaction level of the customers or any complaints. In addition to these, the company focuses on increasing product differentiation as it is possible to increase the availability of the products in the organisation, where the company can offer the customers with a huge variety of food items.

In this regard, the company needs to conduct market research to acknowledge the actual choice and preferences of the customers in that geographical areas and it further help the company to improve product diversification and grab new market scope in future. In addition to these, the packaging style of the products needs to be changed so that the organisation can take initiative to reduce pollution for rising use of plastic bags. In this regard, the company needs to focus on paper packaging rather than plastic packaging and promote environmental sustainability successfully. The strategy of paper packaging is also helpful to maintain the safety of the food where the suppliers and distributers can distribute the food items to the customers with proper quality and safety. In addition to these, in the recent era of digitalisation, the company needs to develop suitable website with one click option where the meal items and combination packages are displayed on the website from which the customers can place their order with one click option. Apart from that, the company needs to implement information and Communication Technology (ICT) in the workplace for enhancing the internal and external communication which in turn helps to develop cooperation among the staff to achieve future success. Moreover, implementing GPS system and ERP in the warehouse are effective for managing the suppliers and the customer’s tracking system also needs to be improved where the consumers can track their orders and see how much time it will take to deliver the meal items.

Conclusion

It can be concluded that, innovation and creativity provides a scope to the corporate firms to develop new strategic planning and utilise the organisational resources and capabilities in order to expand their business and grab new market opportunities in near future. Through innovation and creativity as per the blue ocean theory, the company Hello fresh is successful to expand their business and be the largest organisation in meal delivery. The products diversification, managing the quality of products and services as well as cost minimisation are the latest innovation of the company through which it is possible for Hello fresh to gain high market share across UK, Australia, New Zealand and Germany. It would be beneficial for the company Hello fresh to increase product variety, promote the meal items through developing website and manage environmental sustainability to establish the brand sustainably in the market.

Reference List

Baxter, M., 2018. Product design. London: CRC Press.

Cooper, R.G., 2016. Agile–Stage-Gate Hybrids: The Next Stage for Product Development Blending Agile and Stage-Gate methods can provide flexibility, speed, and improved communication in new-product development. Research-Technology Management, 59(1), pp.21-29.

Dereli, D.D., 2015. Innovation management in global competition and competitive advantage. Procedia-Social and behavioral sciences, 195, pp.1365-1370.

Goffin, K. and Mitchell, R., 2016. Innovation management: effective strategy and implementation. London: Macmillan International Higher Education.

Hakansson, H., 2015. Industrial Technological Development (Routledge Revivals): A Network Approach. Routledge.

Kock, A. and Georg Gemünden, H., 2016. Antecedents to decision‐making quality and agility in innovation portfolio management. Journal of Product Innovation Management, 33(6), pp.670-686.

Mahmoud-Jouini, S.B., Midler, C. and Silberzahn, P., 2016. Contributions of design thinking to project management in an innovation context. Project Management Journal, 47(2), pp.144-156.

Martín-de Castro, G., 2015. Knowledge management and innovation in knowledge-based and high-tech industrial markets: The role of openness and absorptive capacity. Industrial Marketing Management, 47, pp.143-146.

Nambisan, S., Lyytinen, K., Majchrzak, A. and Song, M., 2017. Digital Innovation Management: Reinventing innovation management research in a digital world. Mis Quarterly, 41(1).