Innovation Corner: What is innovation?

A dictionary definition is a change or alteration by the introduction of something new.  By definition, innovation includes the introduction of a new product, a new process, or a new way of doing things.  The common word is the word new. This means something more than a modification. For example, providing the first escalator in a hotel or store I take to be innovation. Modifying the operation of that escalator so that it was activated only by someone stepping on it is arguably not innovation but improvement, in terms of operating cost.  The demarcation line between innovation and improvement is sometimes a grey area, however, we neednt lose any sleep over it. 

Another explanation of innovation is that it is the successful exploitation of new ideas.  The use of the word successful is important because an invention that is not commercialised is not considered to be innovation, since innovation implies the generation of economic value, of wealth for the innovator. 

Whilst there is a lot written on the subject of innovation, there is much less written on any benchmarks to depict an innovative organisation.   

Something had to be done about this so that some way of measuring the level of innovativeness reached by an organisation could be devised. In this way, a yardstick of achievement could be established against which organisations could measure themselves. Here commenced my study of innovation, leading eventually to a PhD in that subject.

I established several characteristics that depicted the innovative organisation, by research and company analysis carried out in several organisations deemed to be innovative. I shall deal with these various characteristics of innovation progressively in these newsletters.

Link between culture and innovation.

There is a strong link between corporate culture and innovation. To go further, whilst current benchmarks for being innovative include high investment in R & D and quantity of patents registered, these can be argued to be outcomes of prior factors.  For example, R & D stems from a decision to have innovation as a goal and from having an availability of resources.  Successful patents arise from investment in R & D.  The question then becomes: Where did being innovative begin?  It began with the right culture for innovation.  Where did the right culture for innovation begin?  The right culture for innovation begins with expectations, where goals and measures for innovation are set.   READ More
 
 In an innovative organisation, decisions are based on having clear goals. Setting these goals in the first place is the top function of senior management.  One clear goal is to be innovative. It is not enough to get on with inventing things and think: Gee, were innovative.  Innovation is a goal in its own right which is the number one goal in an innovative company.

Innovative Behaviour

Innovative organisations strongly encourage an innovation orientation. In some, staff are encouraged to send their ideas directly to the CEO by way of email or hard copy.  They receive a written acknowledgement within a few days and a full written reply within a few weeks.  n some types of organisation this may not be necessary. For example, a management consulting company with a thin hierarchical structure where the CEO interfaces readily and regularly with consultants lends itself to get-togethers where ideas can be thrown on the table without too much formality.

Innovation Processes

The infrastructure in place for innovation to occur has been labelled as:

- Suggestion schemes
- Reward schemes
- Organisational systems and procedures
- Resources to enhance co-operation and collaboration

These have been called hard innovation. Soft innovation arises from organisational culture, leadership, people. Innovation will arise more easily in a corporate culture where staff are encouraged to reflect on their jobs and how they add value to the overall operation of producing good products or services, and where both soft and hard innovation factors are present.

Product vs Process Innovation

Traditionally, product innovation has been regarded as more important than process innovation. However, some managers are becoming aware that product and process innovation are strategically equal, and require the same commitment to research and development. Process innovation should be considered and implemented with current customers in mind, but product innovation that is of a radical type may be inhibited by current customers. This could happen if current customers believe that certain standards that they value and that apply currently will be lowered by the  introduction of the proposed new product. Current customers may not appreciate radical change. Therefore, current customer focus needs to be managed so as not to inhibit innovation. 

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