Disruptive Innovation
Introduction
• Disruptive innovation:
Start by targeting neglected segment
Introducing affordable solutions
Reshape markets
Case study Selection: OCADO
Ocado Smart platform excel operations
Transforming grocery market in UK
Advanced robotics and processes
Streamlined delivery and logistics
Competitive advantage through innovative solutions.
Conceptual Framework
Disruptive innovation based on 3 fundamental elements:
Address neglected segments via innovative solutions
Use Technology for scalability
Innovation moves upmarket, transforming the landscape of industry
• Evolution of Ocado from grocery retailer into technology provider
• Its OSP employs AI, machine learning and robotics
• Disrupting sector of retail & Tech.
Critical Understanding of the Case study (Ocado’s robotic Fulfillment)
In UK Ocado launched as an online only retailer of grocery in 2000
Competing with dominance of physical stores
Demand for online shopping increased
Automated centers optimized order distribution
Ocado smart platform (OSP) a vital lead forward
OSP used robotics and AI.
Major benchmarks of Ocado journey: -: Methods of traditional warehousing initially, home delivery -: Establishing System of propriety robotics, graduation integration of automation
2018- present: Introduced OSP, International partnerships like Kroger.
Application of strategic frameworks
1. Ansoff’s Matrix:
Market development: International expansion of technology
Product development: Creation of automation tech
Diversification: OSP venture into additional chains
Penetration: Focus on grocery order fulfilment
2. Porter’s five forces:
Threat of new entrants: Low owning to high investment in infrastructure and tech.
Threat of substitutes: Preference by customers for traditional shopping
Bargaining power of supplier: Ocado reliance on tech and supply chains
Industry rivalry: Ocado competition with UK supermarket chains like Waitrose, Tesco and Sainsbury.
3. SWOT:
Strength: Advanced automation, exclusive tech, build customer base
Weaknesses: High expenditure on tech, dependence on innovation
Opportunities: Expand OSP globally, decrease operational costs
Threats: increasing competition from grocers, new tech based competitors, regulatory challenge.
Strategic implications:
OSP: Complete package of tech solution
Robotics decrease labor costs
Speedy, accurate order fulfilment
Set new expectations in market,
Distinguishing itself from traditional retailers.
Analysis of Case study’s Strategic Value
Competitive Advantage:
AI-driven robotics lower operational costs
Faster and accuracy in order fulfilment
Worldwide retailers captivated by innovative solutions
Ocado recognized as tech pioneer.
Strategic Positioning:
BCG Matrix
OSP classified as star
Rapidly growing market with prospects
OSP likely to generate revenue
Significant market presence and expansion
Potential for sustained growth
VRIO Analysis:
Ocado distinctive technological advantage
Inimitable innovation offers competitive advantage
Strong organizational support for tech
Secure and long-term market advantage.
Impacts for workforce advancement:
Skilled workforce for automation handling
Expertise needed for automation
Employees trained in automation breakthrough
Ocado focus on workforce development
Regular initiatives for employee development