At the recent E2.0 Forum, I described a particular dynamic I’ve found: there is no set definition of innovation. It’s a concept where everyone has an intuitive sense of what innovation is, but would have a hard time formalizing a definition. Much like the way U.S. Supreme Court Justice Potter Stewart described pornography:
I shall not today attempt further to define the kinds of material I understand to be embraced within that shorthand description ["hard-core pornography"]; and perhaps I could never succeed in intelligibly doing so. But I know it when I see it.
Sure there are dictionary definitions. Merriam Webster defines innovation as: “the introduction of something new.” But that’s really not satisfying. Just because something is new, is it really an innovation? If everything new is an innovation, nothing is.
On the flipside, in popular culture and the business press there is a common view that innovation is all-disruption, all-the-time. Radical technologies and overthrowing incumbents with new business models are the primary definition of innovation. Makes for great articles, but has the effect of excluding many other types of innovation.
Not satisfied with either approach, I wanted to develop a good working definition of innovation. Care must be taken to keep the definition narrow enough to be valuable, while leaving enough margin in the definition to handle various forms of innovation.
Definition of Innovation
Innovation: A change in a product offering, service, business model or operations which meaningfully improves the experience of a large number of stakeholders
Each part of the definition reflects a specific aspect of innovation, described more fully below.
Change: Rather than use the word “new”, I prefer “change”. The word new has connotations of Greenfield development. A change reflects that there was a way people were doing something before, and now there’s a different way. It also allows for an existing practice or technology in another sector to be applied to your sector. The practice or technology may not be new per se, but its application to a different vertical is a change.
Product offering, service, business model or operations: These areas widen the scope of innovation beyond the popular culture sense of it. Innovation can relate to a product offering, be it a brand new product built on a radical technology, or a new feature. Service changes can certainly be innovations. Business model innovations are a favorite, and are powerful types of innovations. Operational innovations can be quite valuable, such as WalMart’s work to improve its fleet efficiency by 25%.
Meaningfully improves the experience: If a company redesigns its packaging, that’s a change. It’s new. But does it meaningfully improve the experience of consuming or using the product? Likely, no. There are many types of changes that can be made, but the question of whether it’s an innovation rests on how significantly it improves the experience. This aspect of the definition raises the bar to avoid classifying too-small changes as innovations. What is meaningful is contextual on a per innovation basis.
Large number of stakeholders: This qualifier separates invention from innovation. By that, I mean that creativity that results in an invention may not actually be an innovation. If an invention satisfies just one person’s interests – likely the inventor – then it really hasn’t crossed the threshold into innovation. The diagram below illustrates the concept:
Not all inventions are innovations, nor are all innovations inventions. But for an invention to be more than something new and creative, it should have broader impact. The term “stakeholders” acknowledges that the beneficiaries of an innovation can vary widely – consumers, shareholders, employees and any subset thereof.
What do you think? Fit your definition of innovation? Feel free to add your thoughts.
(Cross-posted @ Spigit )
Well I think you missed one main part in the
phalanx of innovations. Cultural Innovation are
improvements which affects individuals and
relations between them. This is what Enterprise
2.0 and Social Software movement is about. Hence
it should be mentioned here.
To your separation of invention and innovation. I
don’t agree with you that a small count of
stakeholders define the boarder between them.
Isn’t it also an innovation if a medicine can
help a few people to live at least 12 months
longer?! An additional definition from Bergemann
defines it as follows: „ Innovations are ideas,
which are recognized and accepted as new and
useful by the stakeholders.”
I think more important is the process to create
more satisfying inventions/innovations. Isn’t it?!
Nice. Getting away from innovations as discrete units is key to generating a clearer picture of innovation. Like that. You may want to add STEM Compression (measurable increases in Space, Time, Energy and Matter efficiency) to the efficiency section, and add clear metrics for what constitutes meaningful experience (polling, qualitative analysis, etc). I want to know how an innovation would be scored using this model.
This is a great article. I’m actually working with a client now on some internal comms materials to help employees understand what exactly innovation is. I’d love to read more about the article you link to on WalMart’s accomplishment of increasing fleet efficiency by 25% but your link is broken.
Innovation is the creation of anything new….that creates economic value.
This is the definition I start out with people. What most people don’t focus on is an innovation process. The process gets from insights to ideas to market. The process interacts with strategy, culture, organization, and external market drivers.
People get hung up on the nuances of the varying degrees of innovation, i.e. radical, disruptive, incremental, etc. What matters to each company individually is what is needed for their firm to achieve competitive advantage.
Remember that innovation is a result. It is the combination of research, discovery, invention, experimentation, business planning, engineering.
Just another definition
Innovation is the creation of anything new, that creates change to achieve competitive advantage and economic growth.