Monday
Apr212008
The Management of Innovation
Monday, April 21, 2008 at 10:49PM
Innovation is a large and important topic, and there are many different perspectives and definitions of it. It is important to understand the factors which lead to Innovation, since it is considered to be a major driver of economic growth. In the Evidence Based Management course that I'm teaching at UCT, we take the perspective that Innovation only occurs when tangible economic value is realized from the application of new ideas, inventions, or processes.My perspective on this has been informed by my interactions with Prof. Eddie Obeng, Christof Gillet and Jon Foster-Pedley from Pentacle, a virtual business-school that teaches Innovation to business executives around the world. Their perspective of Innovation as a management process that yields economic value (i.e. Money!) has informed the way I approach it in all my endeavors.
The most innovative companies in the world, such as Google, Nokia, P&G, and Johnson & Johnson, don't leave Innovation to chance. They all have systems and management processes to take lots new ideas, reduce them to what can be implemented, and then set-about developing, testing, and launching the new products, processes, and services.
An innovator needn't be a Creative, nor an Inventor. In fact, many innovators simply have systems and processes to apply the creativity and invention of other people to solving problems. This, of course, can be highly profitable.
Edison, for example, is often cited as the inventor of the lightbulb. This however, is inaccurate, as Edison did not invent the light-bulb. He did, however, tackle the problem of disintegrating filaments in electric powered light-bulbs, a problem encountered by people for decades prior to his breakthrough. To achieve his desired result of a long-lasting and inexpensive light filament, he applied a painstaking process of trial and error, working with numerous collaborators and scientists, many of whom contributed their creative ideas for little or no credit. The result of their work was an inexpensive carbon filament, bent into a horse-shoe shape, which lasted longer due to a more efficient vacuum which he obtained. This made the old light-bulb invention usable in cities, and thus elevated it from the realm of invention to Innovation.
We therefore draw the distinction between Creativity, Invention, and Innovation so that we can prioritize the value-creation aspect of Innovation. This allows more people, creative or not, to engage with the subject.
Creativity and Innovation
While creativity often plays a part in the process of innovation, it is not the end in itself. Creative ideas are not always relevant to the market, nor are they necessarily practical. So, in the process of Innovation, creative constraints are drawn to help focus creative ideas on solving a problem.
Invention and Innovation
Invention is probably one-step closer than Creativity to Innovation. A creative idea may spark the design and development of an invention. An invention, in turn, can be applied in the market to create value or change- thus becoming an Innovation.
Innovation and Action
A quote which comes to mind:
(I'm not sure who said this, some sources say Einstein, but it might as well be Mastercard).
This perspective on Innovation take it out of the conceptual realm, and into the action and implementation space. The most innovative companies, then will have the most effective systems (or Heuristics) for determining which ideas are relevant (perhaps among many ideas submitted by the crowd), and then rapidly prototyping ideas, and testing and developing them in the market profitably.
If I achieve anything in this part of the course it should be that the students realize that Innovation doesn't always come in a lightning flash of insight, but it can be managed as a business process to yield consistent results and value over time.
The most innovative companies in the world, such as Google, Nokia, P&G, and Johnson & Johnson, don't leave Innovation to chance. They all have systems and management processes to take lots new ideas, reduce them to what can be implemented, and then set-about developing, testing, and launching the new products, processes, and services.
An innovator needn't be a Creative, nor an Inventor. In fact, many innovators simply have systems and processes to apply the creativity and invention of other people to solving problems. This, of course, can be highly profitable.
Edison, for example, is often cited as the inventor of the lightbulb. This however, is inaccurate, as Edison did not invent the light-bulb. He did, however, tackle the problem of disintegrating filaments in electric powered light-bulbs, a problem encountered by people for decades prior to his breakthrough. To achieve his desired result of a long-lasting and inexpensive light filament, he applied a painstaking process of trial and error, working with numerous collaborators and scientists, many of whom contributed their creative ideas for little or no credit. The result of their work was an inexpensive carbon filament, bent into a horse-shoe shape, which lasted longer due to a more efficient vacuum which he obtained. This made the old light-bulb invention usable in cities, and thus elevated it from the realm of invention to Innovation.
We therefore draw the distinction between Creativity, Invention, and Innovation so that we can prioritize the value-creation aspect of Innovation. This allows more people, creative or not, to engage with the subject.
Creativity and Innovation
While creativity often plays a part in the process of innovation, it is not the end in itself. Creative ideas are not always relevant to the market, nor are they necessarily practical. So, in the process of Innovation, creative constraints are drawn to help focus creative ideas on solving a problem.
Invention and Innovation
Invention is probably one-step closer than Creativity to Innovation. A creative idea may spark the design and development of an invention. An invention, in turn, can be applied in the market to create value or change- thus becoming an Innovation.
"An important distinction is normally made between invention and innovation. Invention is the first occurrence of an idea for a new product or process, while innovation is the first attempt to carry it out into practice" (Fagerberg, 2004: 4)
Innovation and Action
A quote which comes to mind:
"Ideas are a dime a dozen, people who put them into action are priceless".
(I'm not sure who said this, some sources say Einstein, but it might as well be Mastercard).
This perspective on Innovation take it out of the conceptual realm, and into the action and implementation space. The most innovative companies, then will have the most effective systems (or Heuristics) for determining which ideas are relevant (perhaps among many ideas submitted by the crowd), and then rapidly prototyping ideas, and testing and developing them in the market profitably.
If I achieve anything in this part of the course it should be that the students realize that Innovation doesn't always come in a lightning flash of insight, but it can be managed as a business process to yield consistent results and value over time.
Reader Comments (24)
brilliant piece of work dave.
ps. love the new site design.
Thanks G:)
[...] But perhaps a little intro to the basic tenets on the business of innovation: [Covered more extensively here] [...]
Yo D,
Absolutely impressed by your way of thinking man!
1
Thanks Marvin:)
[...] more so has there been such an urgent need for clarity on how to initiate, manage & implement innovation with accelerated competition and tightening resources on a crowded planet. Companies that realise [...]
Certainly gives me a bit more hope when looking at all the ideas I have floating around on my desk or stuck to various walls as post-its.
Personally, I've found that the right Creative coupled with the right Implementer can be unstoppable. At work I had colleague who was brilliant at bringing my ideas in to the real world. And the better she got at actualization, the better I got at conceptualization - she was sort of a creative enabler.
Lester, you're so right - I've experienced the same thing. Put me together with someone who strong on operations and we're both more successful.
i respect your way of thinking,it is motivational
I completely agree on the idea that innovation is not the idea alone; that it is only when the idea is implemented effectively and commercialized.
Einstein's 'stolen' invention and ultimate innovation is an amazing example to explain it!
Do companies that use heuristics as systematic innovation method employ software, does such a software exist yet? and if so, what is it and how does it achieve the objectives?
Hi Sianna,
Thanks for your comment. There is software that guides decision-making in innovation and leadership practices.
There's a new tool coming out of South Africa soon to guide decision-making, it's called Cognician http://cognician.ning.com/
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[...] The Management of Innovation | Dave Duarte 21 Apr 2008. Invention is the first occurrence of an idea for a new product or process, while innovation. Pingback on Apr 26th, 2008 at 1:24 pm. December 2006, November 2006, October 2006, September 2006, August 2006, July 2006.daveduarte.co.za/the-management-of-innovation/2008/.../21/ - The Management of Innovation | Dave Duarte [...]
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