Innovation and Technology Impact on the Economic Progress of the Country
In today’s business environment, CSR and innovation are known to be two key drives to gain sustainable competitive advantage. Many of the corporate leaders are now focusing to integrate sustainable practices due to higher awareness of the community and environment impact of their operational process and therefore, also expects employees to be a part of this integration. Zhang et al (2015) argued about the Diffusion of innovation theory with stating that it is a process by which an innovation is communicated through particular channels over time amid the associates of a social system. In this report, the research includes how technology and innovation impact the Next Corporation in terms of its sales, profit and growth. The report further states about the company corporate government procedures with an elucidation of Carroll’s CSR framework to better showcase company internal environment.
Innovation and Technology Impact on the Economic Progress of the Country
Binz, Truffer and Coenen (2014) stated that technological innovation fostered various opportunities to obtain a sustainable competitive advantage by presenting a road map to attain future goals in the dynamic market place. Considering the ever-changing marketplace, various organisations seeking to advance their internal capabilities in an organised and agile way to gain higher sustainability in the market. It is also evident that innovation and technology contribute to the economic growth of the country like taking example of Taiwan which is having a small population of 23.5 million citizen’s continues to strengthen its position as a technological powerhouse and consistently held a trade surplus with GDP amounted to nearly 610.69 billion U.S. dollars in 2019 (O'Neill, 2021). Innovation in the dynamic business situation does not enforce firms to depend upon advancement in technology or introducing new products with comprehensive research rather it is regarded as the systematic activity by Teece (2018) that occurs within the company for achieving long term competitive advantage.
The challenge and the opportunity both lie in technology and it continuously bring up new and innovative ways of improving operational process. For instance, it can be used well for developing strong customer relationship like seen with Chabot’s and social media, offering an easy available technology to optimize their business cost such as elimination of employees. Meanwhile, it can be well used with the project management in integration with IT technology employees can be allocate tasks – and deadlines for this work – and updates and messages can be shared with all working on a particular project. Similarly, technological innovations upsurge the demand for new products and businesses using AI and IoT can better understand the customer needs and thus, develop or offer customised products or services differently to each user. Amazon use mobile analytics through AI to determine in-app behaviour of its each user on smartphone and thus, offer customized experience (Tong, Luo and Xu, 2020). Automation is another area where many of the companies are using new technologies in their operations such as RFID tags are used by big brands like Walmart and IKEA to facilitate automation in different operational areas and spaces. Tallman, Luo and Buckley (2018) also stated that any business driven by the desire of its customers can contest as per the new technologies and the pace of innovation.
Innovation and Technology Impact on Next Plc.
Innovation and Technology Impact on Next Plc.
About Company and New technologies and how they are being used by Next Plc.
Next plc was founded by Joseph Hepworth in 1864 and it is one of the high street staple brands for fashion having its presence in 70 countries (nextplc.co, 2021). The company is one of the innovative retailer like recently as per Simpson (2020), the company altering the way it sells its beauty products with introducing a new beauty hall idea and bring important conversion in 5 former Debenhams beauty stores. Ã¢â‚¬Â¯As a multichannel retailer, Next sells its fashion lines in store locations and online and in 2020, the company generated a revenue of nearly 4.3 billion British pounds, which is an improvement on past few years’ data (Sabanoglu, 2020).
Next Plc. further seeks cost saving and growth through innovation and technology adaption like the company has bought Oracle HCM cloud, Unit4 Travel and Expenses, Kronos Workforce Central and integrate them with their enterprise system as a part of discovering new suppliers in contexts with its overall Digital and IT transformation projects to stay competitive, reduce down threats from disruptive forces, or meet the terms with internal instructions to enhance overall organisation efficiency (appsruntheworld.com, 2021). Next Plc. started to develop its online platform through making progression in webpages, adopting digital marketing tools, and make collaborate with third-party brand acquaintances (nextplc.co, 2020). This has increase Next Plc. capability to be agile in the competitive business environment.
Impact on Sales and Profit of Next Plc.
In relation with Next Plc., the company identifies how shoppers are more incline towards online shopping and how they now good turn retail parks over other types of factory. The company believes that its online buyers favour its retail park stores and there has been further development in the sales figure of their provisions which was not opened since years. Wolfson, the CEO of company said that Next Plc. has made a low profit though the most important aspect is that the company did it in the turbulent time of the Covid-19 pandemic (Eley, 2021). This shows that despite the influence of Covid-19, the company started to develop new opportunities while opening future growth perspectives and making itself competitive to be gain in the changing market structures. However, this also depends upon corporate perception which aids overall in quick decision making and systematic process.
Next also gain benefit with innovation and technology to gain higher success in the retail market though the company always act in a proactive way with shifting from small high street shops to out-of-town departmental stores. Next Plc. organisation structure is must flexible to integrate to the fluctuation environmental factors than most like being more careful in introducing in stores rather than capitalising approximately 6.6 million annually for the coming 5 years advancing current stores. In association with growth by geographical location, the majority of company operations are situated in the UK, where revenue further have been reached to 3.7 billion British Pounds in 2020 as seen in the below statists (statista.com, 2020).
Impact on Sales and Profit of Next Plc.
With considering Next unique business model, the sales of Next Plc. increases due to an increase in the number of stores in the United Kingdom together with scaling up the online network sales and further pursue the development of a strong platform for selling homeware and clothing in the country. For the Next Plc. Group, one of the most profitable segment is Next Online aiding 48 per cent of revenue. The next is followed by Next Retail contributing 29 per cent of revenue (nextplc.co, 2019). There has been significant growth in the sales of NEXT branded product progressing strongly and collaborating with their global websites and native aggregators. Next Plc. online sales internationally go over £350m in 2019 and with international sourcing, the company also involves in 500 third-party brands selling via LABEL online and a grouping of business and other branded products providing customers with all covering product ranges, all as a part of a progressive buying experience.
(Source: nextplc.co, 2019)
Together with a comprehensive offering and multi-brand strategy, the company endeavours to raise its volume of sales and revenue with moving to a progressive ecosystem of innovation and technology adaption. Next Plc. provides a credit facility for its online buyers also known as Nextpay and now it is made over as a distinct offer where it enables to offer consumers with access to a credit ability for buying accredited to Nextpay (nextplc.co, 2019). Next Plc. pursues to increase its profit of retail selling range and hence, practising all the approaches to innovation that strengthen the Group financial position and structure. This aids the company to progressively revolutionize its website during 10 years, from a single brand website to an online aggregator of footwear, clothing and home products.
Corporate Governance and Corporate Social Responsibility
Corporate Social Responsibility is a management concept whereby firms integrate environmental and social concerns in their business operations and interactions with their stakeholders. In current business environment, there is rising pressure to dress up CSR policies as a business discipline and accordingly deliver business results while brining coherence and discipline to CSR approach. According to Jamali, El Dirani and Harwood (2015), a effectively executed CSR concept can carry along a variety of competitive advantages, like improved access to markets and capital, increased sales and profits, operational cost savings, developed productivity and quality, efficient human resource base, improved brand goodwill and status, heightened customer loyalty, greater decision making and risk management procedures.
Corporate governance refers to the way in which a business chooses to govern itself, and is complemented by an organisation set of rules that offers direction and control toward attaining its goals. Sarbah and Xiao (2015) stated that good governance implies that the company processes are aimed at creating results that fulfil the needs of society and business prosperity while making strategic use of its existing resources. Meanwhile, it has become the main focus area for businesses to locate themselves positively so that to withstand in a challenging economic environment. According to Salvioni, Gennari and Bosetti (2016), corporate governance leads to several benefits including developing morale, goodwill and legacy, increase the success rate for financial performance and improved sustainability. Most importantly, it develops an effective framework aimed at achieving corporate objectives.
In relation with corporate governance in the UK, Financial Report Council (FRC) sets the UK corporate governance currently with taking actions to promote the quality of corporate reporting with operating independent enforcement arrangements for accountants and actuaries. Considering the history, the first version of the UK Corporate Governance Code (the Code) was published in 1992 by the Cadbury Committee (frc.org, 2018). Over the time the Code has been reviewed and expanded to take account of the rising demands on the country corporate governance framework. For example, the suggestion that FTSE 350 businesses should voluntarily issue details of the number of women on the executive committee in their yearly reports or on webpages (lexology.com, 2018).
Considering the significance of CSR, it is known to be one of the vital factor in developing the brand public image and goodwill and according to Golob and Podnar (2014), firms that have a strong reputation founded on their CSR initiatives have markedly stronger stakeholder provision. In contexts with Next Plc., the company is clearly aware about its CSR accountabilities and further includes the new 2018 Financial Reporting Council where the board committee also looks during 2018-19 like how to develop upon and further firming of the current strong governance framework to meet the new CSR goals and objectives (nextplc.co, 2019). Next Plc. board committee strengthening their corporate governance to make sure of strong commitment directed towards stakeholder interest and the Group motive of providing competitive long term value. It also strengthens and leverages the company risk appetite and risk management policies for the implementing of different policies towards the managerial operations. As one of the prominent retailer in the United Kingdom, the company also involves keenly with their vital stakeholder's group and further consider their perceptions, requirements and notions.
Conceived to carry higher responsibility in all spheres of corporate functioning, and mainly to embrace CSR practices, many companies are strengthening and bringing transparency in the corporate structure to show their commitment towards sustainability and contribution to society. Various CSR programmes steered under the CSR assortment enables the company to create benefit for society on a larger scale and also increasing trust among employees as well as customers (Teck et al, 2018). In relation with Next, CSR goals aid the brand in gaining higher trust among different customers groups, raise employee motivation and level of engagement so as to drive long term sustainable value.
Carrol’s also highlighted CSR model that can be applied on the organisation different applications in range with its key objectives and responsibilities. According to Lu et al (2020), CSR pyramid involves the conduct of an organisation so that it is economically profitable for undertaking other responsibilities later on.
Source: (thomasnet.com, 2019)
From the scenario of above framework, it is important for an organisation to be profitable to fulfil its economic and it also assists as one of the crucial factors for existence and growth. In addition, gaining a considerable level of profit help the organisation to practice other responsibilities too in this model. The changing business environment limiting business with several barriers and this impact the organisation to facilitate with innovative ideas to gain higher level of revenue (Bocken et al, 2014). In association with Next, the organisation is restructuring its business model to make it adaptable with innovation with leveraging its resources to create a strong mass Platform in the country.
After fulfilment of the economic responsibilities, the next level comes up with legal responsibilities which let it essential for the brand to come across the fundamental legal guidelines and create a strong link with the dissimilar government authorities to attain a long term competitive advantage. The essential laws can be linked with any of the rivalry, employees, workplace safety and so forth. The next legal department makes sure to take on common updates on a different problem significant to the Group’s business, comprising legal, directing and authority developments (nextplc.co, 2019). The company also does not embrace on any need towards policy updation or future proceedings or else, except to the level further does not take on any requirement to update publicly or revise forward looking statements, whether as an outcome of new facts, future proceedings or else, excluding to the level lawfully mandatory.
The next upper phase of pyramid is associated with ethical responsibilities, it discusses about the company moral behaviour and practices which also various times requires to go beyond the contracted legal necessity so that to meet the various stakeholder's requirements. For instance, Next corporation provides training to significant personnel’s and share its view with different suppliers for the expectations is linkage with sustainable sourcing, human rights, anti-bribery and so forth. Every year, the Next Audit Committee also obtain viable updates and code of practices provisions from the executive management. The uppermost level in the pyramid link with the philanthropic responsibilities, which according to Pintea (2015), is not mandatory for the companies though achieving the same offers a higher competitive advantage to the company in respective industry. It could be also evaluated with the positive consumer response, inspired personnel’s and social support and with moving to achieve this responsibility, the company undertakes different charity programs and financial assistance to make a difference. For instance, Next Plc. supports more than 400 registered charities and over 330 tonnes of furniture diverted for reuse with Doncaster Refurnish. It helps the company to drive better and positively visibility in the eyes of government and community.
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