Innovation is one of the keystones of progress. It can be defined as the “lifting of current limitations” by “re-designing or redesigning existing procedures or processes in order to achieve new effects or results”. Innovation is frequently misunderstood by many individuals and businesses as something negative. However, innovation can be positive in that it can sometimes mean the difference between success and failure. In other cases, innovation can also cause great economic and social harm.
The need for innovation is often recognized when one company makes an effort to be a leader in a particular industry category, while at the same time relying on imports or foreign markets for many of its products. Companies that recognize the need for innovation, but are unable to identify or develop the true innovation strategy are often at a disadvantage in the marketplace. Unfortunately, because innovation is difficult to define, senior management rarely receives the regular feedback necessary to properly plan for, oversee and adjust innovations. This inability to plan leads to a situation in which innovation becomes a focus for ongoing discussion between management and marketing with little or no effort on the part of the actual innovator.
Companies must be able to define what innovation means to them and how they plan to create new value. Creating new value means capturing existing value by introducing something new or modifying an existing product, process or technology. Sometimes companies have an obvious need for an innovation, but are unable to articulate it. Other times, there may not be an obvious need for innovation but a clear need for something more.
For example, many companies focus on creating new ways to market the company’s products. This may include launching new advertisements, redesigning the company logo or developing a more effective website. While these efforts may provide some short term benefits, they do not create long-term value creation through innovation. In order to create long-term value, an innovative company needs to translate its advertising or promotional efforts into innovations, processes or technologies that make the advertising more effective and more appealing.
Just as marketing is more than just the promotion of products, it is important to recognize that innovation should be viewed in much the same way. The difference between marketing and innovation is that innovation is not a product or process that solves a problem or provides a solution for a problem but rather an activity that creates a new market for a product or secure a new market for a technology. If true innovation is to be understood, it should be thought of as a set of activities rather than as a single solution. The definition of true innovation should include activities like creating new market segments for a technology, securing a place in the market for a technology or building a better, more efficient process or product. These activities are all facets of an overall solution or goal.
Inventors and senior management should always be thinking about how their activities impact the company’s future. They must be willing to define innovation and how they fit into the company’s overall strategy. Otherwise, they will be doing more harm than good. The more they engage in “making do” with the old ideas that can be improved or redone, the more innovation there will be, but the less innovation there will be.