Q Assignment is for MOD003353 Business Environment- A set of activities to uncover new approaches to doing things Home, - MOD003353 Business Environment MOD003353 Business Environment Introduction Innovation is the implementation of significantly improved or a new product in business practices to fulfilling certain purposes. Acquiring competitive edges and higher performance is important. The study on innovation will be performed by considering Britvic Plc, United Kingdom. The chosen firm operates in the food and beverage industry and offers wide ranges of soft drink products. It was established in 1845 in England, United Kingdom (Britvic.com, 2019). The task one shall identify types of innovation and technology used by Britvic Plc. It shall demonstrate the contribution of innovation on the UK’s economy. Corporate Governance is a range of practices that aim to protect interest of all stakeholders. It is important to maintain accountability and integrity with the business process. The study on Corporate Governance will be carried out by taking examples from Bovis Homes Group Plc. The chosen firm operates in the real estate industry based in Kent, United Kingdom (Bovishomesgroup.co.uk, 2019). It deals with house building operations. Task two shall demonstrate the concept of Corporate Governance and apply Archie Carroll’ CSR model to identify practices used by Bovis Homes. Assignment Task 1 Innovation is defined as a set of activities to uncover new approaches to doing things (Drucker, 2014). It is the application of effective solutions to meet new requirements and unarticulated needs. It provides meaningful differentiation and increases the competitive advantage to businesses. Organisations operating in all industries apply innovation in all levels to achieve growth. Technology is the application of knowledge for a practical purpose. The application of knowledge, materials and tools in order to extend human capabilities and solve is known as technology (Edquist, 2013). Technology improves a firm’s efficiency and reduces human error by encouraging automation in business processes. Innovation has a major contribution towards growing economy of the UK. The country has occupied a leading position in the field of research and innovation. The Government is committed to raising investment in research and development by utilising 2.4% of the nation’s GDP (Secouncils.gov.uk, 2019). Artificial intelligence has put the UK at the forefront of the world economy. Companies, researchers and technologists are making use of AI to develop new-generation products that can create a great experience for public. This can position the UK one of the global leaders in immersive technologies. Organisations continue to accelerate and promote the commercialisation of new ideas in all industries across the UK economy. Economic growth of a nation is driven by productivity and employment growth. High-growth indigenous firms create employment opportunities through the application of new technology and knowledge. Gross Added Value is the measure of economic performance in the country. The value increases 7% each year due to implication of new technology in various fields. Researchers found that 1% increase in R&D investment improves multi-factor productivity by 0.13% (Ukri.org, 2019). Other evidence show that innovative organisations increase employment and turnover more rapidly than non-innovators. The impact of research and development on the UK’s economy can be identified by demonstrating GDP growth. Its contribution towards economy was £ 32 to £ 36 billion in 2017. This range was 2.6% of the entire GDP growth. Innovation, research and technology employ more than 57,000 employees each year (Gov.Uk, 2019). The major sectors of UK accept that innovation and technology contribute around 45% of the whole productivity. They are able to generate higher revenue due to application of modern technology. With the increase in productivity of major sectors, the nation’s economic performance increases. UK’s research and innovation are important to innovate the country. Business-led innovations have altered the economy reducing inflation rate and per capita income of citizens. Capacity and capability of labours are improving due to effective application of technology in all business processes. Business organisations implement new technology in various ways such as human resource management, transportation, business communication, improving customer care, production activity and others. They develop a plan on how to implement the technology and assess the ROI and output after implementation. They hire technical persons, who can handle and manage business technology effectively. Developing technical infrastructure and setting pay rates for workers are other aspects to be considered before application of technology (Jensen et al., 2016). The primary goal of Britvic Plc is to get customer data and use information technology to manage and utilise them. It uses technology to simplify the business process and connect with consumers. Some popular technologies used in the soft drink industry include high-pressure processing, soft pouch packaging, 3D branding, an extension of shelf life with nano-bricks and others. Britvic Plc uses high-pressure technology by eliminating the use of traditional heat pasteurising method. Juices processed through high-pressure technology retain healthier nutrients and offer consumers with better taste (Martinez, 2013). The technology has revolutionised beverage categories by enabling Britvic to provide consumers with ready-to-eat beverages. Britvic uses 3D branding technology, which helps in imitating the shape of bottle used for packaging. The technology applies a low-energy process that converts paperboard into distinct shapes. The company uses Fibre forms to develop shapes through the low-energy process. This is an alternative to plastic bottles used for packaging. Soft pouch packaging is another improved technology that replaces traditional cans and bottles (Garcia Martinez et al., 2014). The pouches are lightweight and they reduce carbon footprint during the manufacturing process. Application of this technology provides financial benefits to Britvic Plc by increasing the distribution efficiency and reducing material costs. Britvic Plc uses nano-bricks that provide an innovative coating to plastic bottles. This boosts the barrier properties of bottles used for packaging. Advanced electronic beams are used during manufacturing process, and they help to develop chemical-free aseptic bottle filling systems (Bigliardi and Galati, 2013). This provides a barrier performance to bottles by changing a number of layers, clay and polyelectrolyte used for bottles. Sleeve labelling is a recent and improved technology used by most of the organisations in soft drink industry. It involves heat shrinking a layer to adjust the contours of plastic containers. Britvic is able to communicate with potential customers through a larger canvas easily than normal adhesive levels. It gets ability to design brand messages on a large surface, and this is useful for marketing and customer service perspectives. It also provides an innovative and eye-catching design that helps in leveraging a marked advantage. It is observed that consumers have made a greater emotional attachment with Britvic after introduction of sleeve labelling. Britvic Plc uses CRM to improve its customer service. The technology allows managing all customer data to interact with them directly and maintain a healthy and strong relationship with potential customers. Britvic stays connected with customers and streamlines each business process through CRM technology. This improves overall profitability by acquiring customer data and utilising them to come with innovative soft drinks. With the application of CRM software, the Company has succeeded in improving customer interaction, getting easy access to business information, tracking leads, and increasing customer support. The new technologies were introduced after 2006. Sales and profits of Britvic Plc have increased after the implementation of these technologies in manufacturing and marketing area. The company has generated £677.9m revenue in financial year 2005/06 (Annualreports.com, 2019). Profit earned in that period was £39.6m. The company witnessed growth after introducing CRM, high-pressure technology and other advanced packaging technology. Britvic innovation has generated 7.1% of revenue in 2017 (Britvic.com, 2019). It generated £1,503.6m revenue in 2017. Profit incurred in this financial year was £117.1m. Similarly, revenue obtained in 2018 was £1,540.8m. Profit attributable to the shareholders in 2018 was £111.6m. Britvic has its own factories in different markets, where it utilises a range of packing technologies for glass, PET, aluminium and steel cans. New packaging innovations add extra sales volume in peak times. Since 2005, The Company has focused on its innovation pipeline to produce soft drinks with zero or low-sugar. Ginger and no-sugar coal combination have hit UK’s market. In the second half of 2017, Britvic has launched Robinsons Refresh’d given customers with a pleasant experience. This healthier and natural drink is able to achieve a sales value of £4m within 19 weeks of product launching (Britvic.com, 2019). These examples show how Britvic comes with new products each year and gain ultimate financial performance. These findings were drawn from the annual reports of Britvic Plc. These are supported by relevant examples and explanations. Assignment Task 2 Corporate Governance is the way in which corporations are governed. It means carrying out business operations as per key stakeholders’ desires. It is the technique used for balancing an organisation’s economic and social goals with community goals (Elshandidy and Neri, 2015). Good and effective corporate Governance ensures business success and economic growth. It lowers the capital cost and minimises corruption, risks, wastes and mismanagement. The concept of Governance came into the picture 20 years ago. Now, it is used in all companies, local authorities, universities, charities and National health trusts. It particularly emphasises on integrity, risk management and accountability. In UK, a committee on Corporate Governance was established in May 1991 (Frc.org.uk, 2019). The Stock exchange, Financial Reporting Council and accounting professionals, show concern about financial reporting standards and published the key principles of corporate governance in 1992. The basic principle recommended by the committee is that Chairman and CEO of companies should be separated. Boards of each organisation should have three non-executive directors. Each board must have an audit committee comprising of non-executive directors. Key stages of Corporate Governance Code include Combined Code (1998), Turnbull Guidance on Internal Control (1999), Stewardship Code (2010), and Company Act 2006 (2013). The committee has focused on new guidelines on Internal Control, Risk management and Basis of Accounting in 2014 (Grantthornton.co.uk, 2019). Board of Directors is responsible for formulating, reviewing and re-formulating policies, objections and mission for a company. This helps organisations to draw the basis for strategy formulation and execution. Board of Directors design organisations’ structure by considering policies, objectives, environmental factors, the role of quality, degree of competition, expectation of employees and others (Du Plessis et al., 2018). They take major financial decisions such as sanctioning of funds to various projects, repayment of loans and advances, distribution of profits and others. They screen and select top executives, who can formulate and execute strategies and tactics. Corporate Social Responsibility is an integrated business approach, which supports sustainable development by delivering social, economic and environmental benefits (Unit, 2015). It refers to a self-regulated and self-controlled business model that enables a firm to be socially responsible. It works as a positive word of mouth for organisations by serving a wider community. Serving stakeholders, society, and customers can take a business to a higher level and ensure its long-term profitability and productivity. CSR practices by Bovis Homes Group Plc can be identified through application of Archie Carroll’s CSR model. The model emphasises on four areas including ethical, legal, philanthropic and economic. Adhering to legal practices ensure that the company’s business activities are legal. Obeying guidelines and principles help to protect consumers, who have trust in the business process. The company can be penalised or shut down if it does not follow the legal practices designed for real estate industry. While dealing with clients regarding house possession and related purposes, Bovis try to convey all required rules and regulations to them. Bovis Homes Group Plc obeys to all employment legislation including health and safety norms, Equality consideration, Data protection norms and others. It aims to secure health and well-being of clients and employees by taking safety procedures within the workplace. It operates an internal inspection regime that oversees overall health and safety performance (Bovishomesgroup.co.uk, 2019). It does not discriminate employees while providing an opportunity for promotion and recognition. Candidates are not discriminated during hiring and selection process against any personal characteristics including gender, race, age and others. As a part of economic responsibility, Bovis Homes aims to become profitable by providing an adequate amount of return on investment to key stakeholders. It creates employment opportunities for thousands of people each year. Total turnover rate of Bovis Homes has reduced to 28% due to decrease in a number of redundancies made in 2018 (Bovishomesgroup.co.uk, 2019). A number of initiatives are taken by the firm to retain and attract employees. It tries to improve the standard of living of people by improving the service provision. It purposes to utilise resources in an efficient way by innovating offerings and executing proper marketing strategies to improve annual revenue. The sole purpose of Bovis Homes is to survive and benefit communities for a longer period. The organisation’s ethical responsibilities include recycling, managing waste, resource consumption as per requirement and others (Crowther and Seifi, 2018). With a continuous focus on climate change, Bovis Homes emphasise on mitigating the impacts of building development on local environment (Marketscreener.com, 2019). Evolution of new building techniques and advances to reduce carbon output is another ethical practice adopted by the firm. The company works in association with local governments and consultants to develop a management plan that can protect historic buildings, trees and save environment from pollutants. It has established drainage strategies that involve making use of sustainable urban drainage systems. It provides communities with recreational areas and landscaped parks to enjoy a healthy life. The organisation aims to mitigate key ethical uncertainties and risks such as land contamination, environmental pollution, health hazards and others. Bovis Homes Group seeks to minimise its influence on the environment by limiting greenhouse gas emissions, sustainable management of water, and maintenance of open space (Bovishomesgroup.co.uk, 2019). The key purpose of performing ethical responsibility is to perform morally and ethically. With implication of ethical responsibility, the firm goes beyond narrow requirements of law and legislation. Another form of ethical responsibility comes in the form of promotion and advertisement. Bovis Homes incorporate correct information in advertisements rather than publishing false things to pursue them for buying. It offers salary and wages more than the minimum level. Additionally, it provides insurance, benefits, perquisites and others to employees for ensuring a workplace with happy employees. Philanthropic responsibility of Bovis Homes is to pay back to society. It is discretionary but important for a business. The organisation donates goods, funds or services to other organisations or for a cause. It sponsors local events organised within the UK. The purpose of performing philanthropic responsibility is to spread goodwill and promote the welfare of human being (Huang et al., 2014). Conclusion It can be concluded that the application of innovation and technology improves the productivity of an organisation and this contributes to a nation’s economic performance. Britvic Plc uses high-pressure technology, soft pouch packaging, nano-bricks and other technologies to improve its production and increase visibility among consumers. Sales and profit of the firm have increased after the successful implementation of these technologies. The study found that the evolution of Corporate Governance has enabled organisations to maintain accountability, transparency, and integrity in business activities. With application of Archie Carroll’ CSR model, it is found that Bovis Homes Group Plc is taking responsibilities in terms of economic, ethical, philanthropic and legal. Complying with responsibilities provide the organisation with business advantages for the long run.