Innovation defined
June 24th, 2009
The word innovation is pervasive in business today. So pervasive, in fact, that the Wall Street Journal has identified something called innovation fatigue, which IBM lampooned with its Innovation Man Ad. But most of us know that real competitive advantage is the de facto product of some form of innovation. So which is it - lampoon or savior? The problem is that innovation as a business discipline has come with its share of hucksters and snake-oil salesman who define innovation as “facilitating a culture of out-of-the-box, goal oriented, value added, disruptive, web 3.0″ thinking. For all of us in the business of innovation who are not selling snake oil, I propose the following basic definition:
Business Innovation (biz’-nis in’-e-va‘-shen) n. a significant change to an existing business process, program, product or service that leads to profit growth
Note that under this definition innovation is well beyond “product” and, above all, it must lead to profit growth. Lampoon or savior? Profit growth sounds much more like savior to me.
Craig Malmstrom
October 23rd, 2009 at 8:42 am
Brad,
I like the definition of innovation; I agree, if a company is going to talk innovation - they must make significant change. My company preaches innovation but, when our LEAN Master black belts state this slogan in the kaizen and green belt training ‘Creativity before capital’. I believe that stiffles creativity by 50% because that is telling employees do not een think about spending money. You cannot save you way to prosperity … thoughts?
Brad White
October 23rd, 2009 at 3:08 pm
Craig:
I agree that you can’t save your way to long-term prosperity. But you may be able to achieve short-term success through cost savings.
Six sigma certainly has its place. Process innovation can lead to significant, sustainable cost savings. But only when it leads to significant, sustainable change to the processes that account for cost.
Innovation as a comprehensive business discipline should be applied not only to processes but also to create significant changes in products and business models. No company has truly embraced innovation as a business discipline if it only adopts one form of innovation.
Check out http://www.doblin.com/AboutInno/innotypes.html for a decent articulation of the different types of innovation.