By Craig Malmloff,
The popularity of innovating and inventing has caused many to attempt to do both with limited success and often significant costly failure.
Better understanding of what innovation is as well as the challenges associated with it will greatly help potential success.
There are many definitions for innovation, the following are the ones I have found to be the most accurate.
"Innovation is starting with a market need and then creating something to meet it. Inventing is starting with the idea and then looking for someone who will get excited about it." -G. Michael Maddock
Innovation = creativity + implementation, developing or finding a great idea is useless if you can't implement it or sell it to someone who believes they can. -Bob Sutton; Stanford Organizational Psychologist
With this definition there are several main areas of innovation:
Financial – Business Model (How we make money), Network (Structure or Value Chain)
Process – Enabling (Assembled capabilities needed), Core (Proprietary or current processes)
Offering – Product Performance (Features and function), Product System (Extended system around the product) and Service (How the customer is serviced)
Delivery – Channel (How the customer is connected to the offering), Brand (How the benefit is expressed) and Customer Experience (All aspects of customer interaction with the company)1
When many think of inventing they mainly think of the offering or specifically the product only. Innovation captures more than just the product. Because of this it is disruptive and many challenges emerge. Innovation challenges paradigms, has higher execution risk, threatens existing competencies as well as requires time and effort to be realized. Yet, when executed correctly innovation can double sales and EBITA.2
To get started executing innovation develop the following skill set:
Associating— Drawing connections between questions, problems, or ideas from unrelated fields
Questioning— Posing queries that challenge common wisdom
Observing— Scrutinizing the behavior of customers, suppliers, and competitors to identify new ways of doing things
Networking— Meeting people with different ideas and perspectives
Experimenting— Constructing interactive experiences and provoking unorthodox responses3
1 Doblin Research. "The Ten Types of Innovation". Doblin. 2010 .
2 Nilsson, Per I . "Pathways to Innovation Excellence". Arthur D Little. 2010 .
3 Dyer, Jeff, Hal Gregersen, and Clayton Christensen. The Innovator's DNA: Mastering the Five Skills of Disruptive Innovators. 1. Boston: Harvard Business Press, 2011. Print.