Bus Adm 600 - Innovation

Innovation

The key to a firm’s profitability and survival is the ability to continually generate innovations. This is specifically true with a company like Facebook. The New York Times article, “The Future of Facebook May Not Say ‘Facebook’,” discusses the innovation strategy of Facebook. Since the company went public a couple of years ago, Facebook have had strong showings in their statements. Most of the companies’ revenue comes from advertisement. However, Facebook’s strategy involves to continually seeking new ways of innovation. The effort, which was begun discussing this year, is called Creative labs. Mark Zuckerberg described Creative Labs as basically unbundling the big blue app. “In the past, he said, Facebook was one big thing, a website or mobile app that let you indulge all of your online social needs. Now, on mobile phones especially, Facebook will begin to splinter into many smaller, more narrowly focused services, some of which won’t even carry Facebook’s branding, and may not require a Facebook account to use.” The multi-app strategy is meant to adapt Facebook to the way people use mobile phones. For example, Facebook has found that people get messaging replies 20 percent faster through Messenger than through the Facebook app.” For software companies, one of the perils of success is becoming shackled to your customers; the more users you have, the harder it is to innovate, because most will be averse to any change.” By filtering innovations into new apps that doesn’t have an established user base, engineers and designers can take creative leaps that may not have worked if they’d simply been adding features to Facebook’s primary app.

The innovation strategy of Facebook is quite interesting. With more than 82% of their revenue coming from Ads, click rates on Ads, and other forms of marketing, the Creative Labs innovation is different. I believe this is a great strategy as Advertisements will always not be their biggest form of revenue. Creative...