Innovation Models Of Argosy Property Limited †MyAssignmenthelp.com

Question: Discuss about the Innovation Models Of Argosy Property Limited. Answer: Introduction Argosy property limited is a company located in New Zealand and it does concentrate its operations in the retail industry. The company does invest and manage properties in different parts of New Zealand. The company has three major focus which are industrial, retail and offices. Its major operations are clustered within Auckland and Wellington. The company has 64 investment properties in their portfolio that amount to a total of NZ$ 1.41billion. The property industry is widely changing with the advent of technology and innovation. The aspect has necessitated the company to employ different innovation models to ensure they maintain a strong business stride in their industry (Argosy property limited | Forsyth Barr Investment, 2017). According to (Goffin Mitchell, 2016, p. 6) innovation refers to the quest for and the discovery, creation, advancement, implementation and the commercialization of new goods, organization structures, processes, and methods. In the business sector innovations are the key strategies that ensure that organize is able to maintain a competitive edge against their competitors. The implementation of various innovation models often lead to effective utilization of resources, agility, flexibility in the culture delivery that does provide a firm support to the various forms of collaboration that an organization partakes in. to achieve their growth. In the context of Argosy property limited the company has engaged in a number of innovation models which are process which focuses in the improvement of the internal organization structures to create a formidable organization culture that can withstand external changes. The second model is the incremental innovation that focuses on inherent input improvement with an aim of achieving a higher organization output in the property limited. Finally, the open closed innovation model which will be the main focus of this paper. Organization structures in the New Zealand Context Based on (Chesbrough, 2006) does refer to the process of combining inflows and outflow of creative ideas with an aim of speeding up the innovation taking place internally and facilitating its expansion to the external markets. The process of open innovation in New Zealand especially in the properties industry has been facilitated by the increase in the number of educated personnel and their desire to venture into new territories that challenge their creativity. A high number of people graduate on a yearly basis in the properties industry in New Zealand. Furthermore, the employee turnover in organization does result in them taking the knowledge they have acquired into another firm. The aspect facilitates the inflow and outflow of creative ideas between firms hence facilitating the improvement of their organization structures(Van de Vrande, De Jong, Vanhaverbeke, De Rochemont, 2009). Secondly, in the case of Argosy property limited the company has venture capital available that provides them with the need to implement various innovative technological ideas. Moreover, the company has entered into various collaborations and relationship building with their investors and supplies an aspect that has been integral in the adoption of the open innovation model (Argosy.com, 2017). Argosy property limited has strategically positioned itself in Auckland and Wellington an area that is thriving within the property field. The aspect ensures that despite the fact that the company is extending its operations its physically close to the regional area of excellence. The presence facilitates the acceleration of the companys ability to absorb capacity not only from the graduates but also from the employees in the companies around. The company has a favorable employee policy that reduces its employee turnover and attracts the best brains in the industry. This ensures that there is a constant flow of knowledge that helps the achievement of their organizations objectives. On the structural perspective of the organization structure, Argosy property limited has segregated work divisions that are industrial, retail and offices. Each of the three work division is united by one aim that is ensuring that there is cost reduction in their operations by employing technology. The technology employed is geared towards ensuring effective use of resources to match the needs of the market with the properties in their portfolio. The company does incorporate the aspect of outsourcing and partnership to reduce their inventory levels and ensure that they are able to effectively focus on the short and long term needs of their operations. The third perspective in open innovation is the users. Argosy property limited has clear identified its target market and divided them into three divisions retail, offices and industries. Their customers are integrated in the process of innovation in the early phases to ensure that the architectural designs adopted meet their needs. The incorporation of the customers leads to mass customization of the properties in the long run(Franke Piller, 2003, p. 580). Furthermore, it increases the knowledge of the company on the peculiar needs that their customers want in the properties that they require. Also, it does break down the autocratic nature of innovation by introducing a sense of democracy; user innovation is one of key areas that form the basis of open innovation model(Von, 2005). The other perspective that contributes to the organization structures development within the open innovation model is the supplier perspective. Suppliers position in the property industry has often been relegated to delivering the supplies needed only. Open innovation model, does introduce the relationship aspect that facilitates knowledge sharing ensuring continuous improvements of operations(Chiang Hung, 2010, p. 294). Argosy property limited has acknowledged this aspect by involving their key suppliers in various training programs and encouraging their input by having an open relation that enables them to comment on the various operations. The company was listed in 2002 and the management team encouraged their key suppliers to purchase shares an aspect that ties them together to achieve a common objective geared towards the growth of the company (Argosy property limited | Forsyth Barr Investment, 2017). The fifth perspective, deals with the introduction of a leveraging aspect. Based on (Chan Kim Mauborgne, 2004), the open innovation model plays a vital role in the introduction of intellectual property multiplication into the present business and market arena. The infusion of intellectual in the property field coupled with technology provides a viable environment for the advancement in property commercialization. Argosy property limited has a research and development center that serves as the umbrella for all the three divisions that the company operates. The research and development works closely with the other departments ensuring a seamless flow of information within the organization structure. The department shares their discoveries which have ensured that the company is able to maintain a progressive stride in the property limited despite the harsh global economy. A good example is the different non-core assets that the company has in its possession which they plan to transform into quality developments (Argosy property limited | Forsyth Barr Investment, 2017). The other perspective integrated within the open innovation model is the cultural perspective. The culture of an organization is vital in ensuring innovation processes are promptly embraced. Culture is influenced by the values of the organizations, streamlined communication process, management information system, supplier list of evaluation and criteria in project selection(Gassman, Enkel, Chesbrough, 2010). Argosy property limited organization strategies has been geared towards ensuring that they retain competitiveness and respect in their operations. The culture is focused on excellence, integrity and relationship building an aspect that has propelled its success (Argosy property limited | Forsyth Barr Investment, 2017). Barriers to Argosy property limited open innovation strategy According to (Mortara, Napp, Slaicik, Minshall, 2009), there are four open innovation barriers which are culture, motivation, skills, and procedures. The other barriers include potential risk, organization strategies that do not support open innovation, trust centered on people, and technology(Huizing, 2011, p. 6). Argosy property limited is facing the perceived risk especially in integrating external technologies in their operations. The fear is mainly among the employees andmanagement team who perceive it as a way of them losing their jobs (Argosy property limited | Forsyth Barr Investment, 2017). Secondly, the company does have a culture centered in maintain the progression of the organization internal. The strategy does limit the trust among people hence limiting the support required in open innovation with respect to integrating collaborators with the company. Thirdly, the organization has a defined set of procedures that direct its operation. The introduction of open innovation model will result in an overhaul of their procedures an aspect that themanagement team is quite resistance. Lastly, the transaction cost incurred in adopting open innovation is huge an aspect that forces, the property limited to reduce its drive in adopting the model (Argosy.com). Key processes of open innovation models There are two facets that dictate the process of open innovation model they are inbound in the aspect of internal ideas and the outbound that focuses on the external ideas that inflow into the company. The approaches are essential in the decision making process adopted by any organization in every single stage of the process (Chesbrough, 2011). Inbound innovation Internal innovations are used to add value to the operations of the organization through taking the continuous present operations of the company and introducing technology. Technology takes different forms in the property industry it often deals with means to ensure that the properties create value to the end consumer and ensure the continuous operations of the company. Technology involves using software that consolidates the information flowing within the organization(Linchtenthaler, 2011). Synchronizing information flow makes it easier for Argosy property limited to be able to make profits despite the global economic downturn. The second aspect deals with licensing or selling the internal technologies that do not benefit the organization. Business structures often alter with the introduction of new technologies within their operations. Open innovation encourages the sharing of the technology to foster growth. This deals with offering it to another company that has a similar business model as the one offered by the company.(Chiang Hung, 2010) The last aspect deals with coming up with new strategies that will play a role in integrating the new technology within the operations of the firm. The integration for a company in the property sector often takes place through an internal venture, an acquisition or a joint venture. Argosy property limited carried out a takeover of the Urbus properties and carried out an internal re-organization of their operations to ensure they consolidate a business model that will facilitate their growth (Argosy property limited | Forsyth Barr Investment, 2017). Outbound innovation External innovation often arises from the corporation of organizations with institutions of higher learning, creation of alliances, joint ventures of carrying out a lead user innovation. The startups play a vital role in facilitating the progression of technology where the blue chips company monitors the progression(Chesbrough, 2006). The monitoring is done through offering financial support and when an opportunity arises the technology is launched into the market. The decision making process often does stem from selecting a particular area for the company to offer financial support as a start-up and await the development of the technology. On the other hand, the company can wait for the innovation to be developed and being among the first companies to acquire it in a bid to maintain a competitive edge in the industry(Vanhaverbeke, 2006). Financial Results In 2017, the company made total revenue of 64.92 million and they reported a dividend of 0.06 NZD. As indicated in the report the company is listed and they managed to record 0.028 earnings per share in the first quarter of the year (Argosy Property Ltd, ARG: NZC forecasts-FT.com, 2017). The company had a gross margin 80.65%, net profit margin 83.55% and the operating margin totaled to 117.07%. The companys cash reserves dropped to 56.77 million and managed to accrue 13.67 million in cash flows. On the aspect of investing the company spent 43.26 million an aspect that has been pertinent in contributing to a growth rate of 1.24%. Finally, on the aspect of debt to total ratio the company has a 37.66% on its assets (Argosy property limited | Forsyth Barr Investment, 2017). Conclusion In conclusion, based on the analysis open innovation is a new concept that is trickling down from the technological to other industries like the property industry. Open innovation is now being adopted not only by the large firms but also small and medium enterprises. As discussed, in the paper it provides the companies with chances to reshuffle their operations for success. Argosy property limited has managed to embrace the opyen innovation but in smaller strides due to the barriers discussed in the report. The company through its management needs to work harder to fully adopt the innovation model. References Argosy Property Limited | Forsyth Barr Investment Advice. (2017). Forsythbarr.co.nz. Retrieved 23 July 2017, from https://www.forsythbarr.co.nz/markets-and-research/companies/NZX/ARG/ Argosy Property Ltd, ARG:NZC forecasts - FT.com. (2017). Markets.ft.com. Retrieved 23 July 2017, from https://markets.ft.com/data/equities/tearsheet/forecasts?s=ARG:NZC Chan Kim, W., Mauborgne, R. (2004). Value innovation: The strategic logic of high growth. Harvard business review, 82(7-8), 172-180. Chesbrough, H. W. (2006). Open innovation: The new imperative for creating and profiting from technology. Harvard Business Press. Chesbrough,H,. (2011). Everything You Need to Know About Open Innovation.Forbes.com. 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