• Research conducted by the National Science Foundation shows that R&D is integral to innovation; 66% of all companies that funded R&D were product innovators and 52% were process innovators. Compared to the non-R&D average of 9% for product as well as process innovation, these numbers are incredible.
• The Organisation for Economic Co-Operation and Development shows that R&D costs in the United States in (2007 and 2008) are 124% greater than yearly the average of the last decade (12,754,223,000)
• “Only 25% of all new products that established companies introduce in their markets succeed. Seventy-five percent fail.”
• The United States is ranked the 4th most innovative country in the world.
• The United States’ improvement in innovation is second to last out of 44 countries surveyed.

Leading companies gain success through their ability to creatively solve problems and provide cutting edge products or services. The most innovative companies have been those whose practices and processes have shaped their surroundings. Finding the balance between innovation and practicality is a constant struggle. Looking into creative approaches towards business provides insight into how to achieve this balance.

Innovation and Apple culture

Though you may be sick of hearing about Apple in terms of innovation, it is too difficult not to mention. Well known for its stylized technology, Apple has moved beyond simply being a company and has become its own culture. It has created a loyal following through its clean aesthetic and highly interconnected network. Inventing the iPhone, iPad and having recently come out with Lion OS X, Apple continues to change the way we use technology. Most recently, Apple’s unveiling of its iCloud technology shows that it does not plan on ending its dominance of the technology market any time soon. Perhaps more important to the success of Apple is its innovation in shaping systems for technology and marketing.

Creating a series of cross-reliant systems, different Apple products perpetuate their metaphorical closed circuit. ZDNet writer Andrew Nusca comments on Apple’s marketing innovations in Through cloud, Apple circles wagons on ecosystem: 10 proof point. With every update and new piece of equipment, Apple enforces means through which it can “far more effectively police its network.” The company has achieved an almost unprecedented amount of control over user behavior and activity. Simultaneously, it has also managed to create an extremely large customer base, not just for technology, but for software and digital products. This sort of stranglehold shows that ”the company is circling the wagons on its computing ecosystem, shutting out outsiders unless they play by strict rules.“ Through requiring users to rely only on certain programs and being highly involved in determining user behavior, Apple is able to ensure that their highly connected network is preserved. Beyond this incestuous perpetuation, Steve Jobs, clearly shows that in order to be at the top, you must take risks.

Lead Don’t Follow

Learn from Apple, but don’t copy their approach. In an interview with Businessweek, Jonathon Ive discusses innovation as Apple’s key to success. The leader of the design team at Apple, Ive, promotes the idea that companies need to “define their own clear, high-minded raison d’être.” Though Apple’s approach worked very well for Apple, he warns against following any business model or process too closely.  He goes on to explain that true innovation reaches beyond what is “different and new” and rather, aims for something that is significantly better.

Benchmarking may be preventing you from realizing your company’s potential. As Myra White explains in her post Is Your Company Playing Follow the Leader? , expertise, independent thinking and creativity are what make companies great. Relying on the work of others, instead of maintaining innovative approaches will limit your possibilities. In order to succeed, it is essential to realistically assess your company and determine best practices that are unique to your assets. Leading companies such as Microsoft realized that in order to stay at the top, they had to create an approach that worked for them. The individual strengths, weaknesses and attitudes of employees contribute to unique work environments and determine the effectiveness of different work processes.

Innovation Does Not Always Mean Invention

Innovation does not necessarily mean invention. Before you reinvent the wheel, understand your market context.  A recent article on BNET titled The Art of Riding Apple’s Coattails provides a case study of innovative success through a company called DODOcase, which makes covers for the iPad. Perhaps most important is remaining aware of current developments in the market. Jen Haley comments “the challenges in this industry are many, chief among them staying ahead of new products and innovations (iPad 3, anyone?), and it’s not like Apple is any help in that department.” Even when your product relies upon existing technology, keeping your ears to the ground can help your business survive. It is possible to approach the market through existing channels and add to what is already available, but be prepared to handle curve-balls that come your way.

Today, the challenge is taking corporate organizations built for efficiency and rewiring them for creativity and growth. This is not only attainable through technological innovation. Vijay Govindarajan, a professor at Dartmouth’s School of Business states, “there are a lot of different things that fall under the rubric of innovation… innovation does not have to have anything to do with technology.” Often, people fail to consider the many types of innovation that exist outside of invention.

Though innovation does not necessarily mean technological invention, the two interact in meaningful ways. Olof Söderblom, inventor of the token-ring network protocol, explains the relationship between invention and innovation. In his essay titled “Thoughts on Innovation,” he
states, “an innovation results from an invention and can also be the result of employing existing inventions in new applications.” He sees innovation as following invention, but stresses that both result from the need to solve a problem.

Resources for Creative Mindsets

• The CEO of Bharti Group, Sunil Mittal began his business in the 1970s working with bicycle parts. In the 1980s he entered the burgeoning telephone business and eventually moved into mobile phones in the mid-1990s. Mittal’s success is partially due to his ability to broker deals internationally. and even managed to snag deals with international giants Wal-Mart, Vodafone and SingTel. Today, his company is worth over $8.3 billion and serves over 190 million customers in 19 countries. Through a highly innovative business model and unorthodox approach to negotiating, he became one of the greatest living success stories in business around the world.
• An all or nothing approach may be frightening, but it can pay off big. Sometimes you have to gamble to succeed. Innovation requires an almost unhealthy obsession with your ideas. Innovations are risky because they are different, but incremental change is not enough.
• Apple has enjoyed amazing financial gains for the last four and a half years. Continually exceeding market estimates and expectations, the company’s success is unbelievable. Just in 2011, Apple has risen by 25%. With a $400 share price, Apple is close on the heels of Exxon to become the most valuable company in the world.
• Out of PC World’s top 100 technology products list, there are 3 Apple products in the top 25. The iPad, iPhone, and Apple TV were all able to make it near the top of the list, further proving Apple’s presence in the market.
• The New York Times reports on what makes apples iCloud service special. The online storage service will allow users to sync their music, photos and software across multiple platforms. Such interoperability is aimed at simplifying the user experience.
• Businessweek discusses some of the world’s most innovative companies and what makes them so innovative. IBM, Research in Motion, Virgin, and Apple are all among the many included in this round up of creative organizations.

Okay, so, we know that innovation is good. Given that, how do we go about increasing it? What can be done to foster an innovative environment? What sorts of approaches are more conducive to innovative results? Employing diverse work groups, utilizing open innovation and applying co-creative methods are among the most beneficial tools to increase innovation.

One of the greatest examples of improving development is Proctor and Gamble.  Rather than relying on their in-house team to come up with and develop all of their ideas, they established systems that collected ideas from the outside. Known as open innovation, this approach is defined by Andrea Meyer as relying on participation. She explains that “attracting participants and encouraging activity is a key success factor in obtaining and vetting new product, service and process innovation ideas.” Open innovation can make or break your creative efforts, and may be just what you need to further development.

Systems based on open innovation include networks of people from many sectors. Encouraging interaction between those in diverse sectors such as university, government, and private labs, means higher innovation. For P&G this can be seen through NineSigma, YourEncore Inc., and yet2.com. All of these platforms addressed different stages of development through collaboration. By increasing interactivity and communication among technical professionals, P&G was able to greatly increase innovation. Allowing diverse individuals with specialized skills to openly interact resulted in unique approaches to problems encountered.

Renowned innovation expert Stephen Shapiro also argues for the importance of diversity in innovation. He explains, “If you are working on an aerospace engineering challenge, and you have 100 engineers, adding another engineer to make it 101 won’t increase your likelihood of solving the problem. But if you add a biologist, a musician, a nanotechnologist or someone from the movie business, you might find some different solutions.” Outside perspectives will result in different approaches. If you are stuck trying to find ways to increase innovation, employ the help of some outside sources.

A firm believer in open innovation, Shapiro claims that utilizing this approach will “speed time-to-market, reduce costs, and minimize risk.” A highly consumer oriented approach provides strongly indicative market performance information.

Customer interaction can result in beneficial co-creation that leads to customer oriented innovation. Gaining a first-hand perspective of what customers want from your business can better help you innovate for their needs. Cherly Perkins of InnovationEdge explains in her post How Customers Drive Co-Creation that value in the contemporary economic environment is being created differently. Nowadays, small and large companies alike use co-creating as a mutually beneficial way to “redefine traditional business models and even redesign many aspects of their business- not just product design.” Such involvement may prove invaluable in meeting consumer needs as well as developing appropriate processes. By making the consumer part of the creation process, you are ensuring that your product or service will be well received.

Using car companies as an example, Francis Gouillart of the Co-Creation Effect writes, “what is needed is a broad-based engagement platform that attracts car customers and their social partners and gives them tools and structure to interact effectively with car company designers, their automotive parts, and software suppliers.” Co-creation is much more than simply receiving customer advice, it involves their active involvement in shaping innovation. Beyond logistical issues, co-creative approaches to innovation must include meaningful interaction and opportunities to cooperate. Furthermore, Gouillart explains that, “this platform will need to include the ability to discuss abstract items… provide the ability to exchange conceptual designs…and supply the capability to co-design concrete objects.” On the consumer end, high levels of involvement on significant developmental processes is needed for true co-creation. Such approaches to development may be the future of business and a better alternative to the old ways of creating products in isolation.

Disruptive innovation is another tool in the innovation toolbox. Creating an entirely new market or value network that disrupts an already existing market, can shift business in your direction. In some cases where growth doesn’t seem to be happening, innovations in delivery rather than product characteristics can make the difference. Take Go-GURT, for instance, General Mills’ unique approach to marketing yogurt towards children. Instead of changing or improving flavor, changing the packaging resulted in a dramatic increase to sales. By creating a new niche, General Mills created new desires in consumers and led to the formation of a new market. Improving a product or service in unexpected ways can allow you to carve out space for your business that consumers didn’t even know was there.

Though it is accepted by many, there are still those who don’t agree with the theory behind disruptive technology. They maintain that there is no such thing as disruptive innovation and that it is simply a buzzword meant to sucker investors. John C. Dvorak claims that, “there is no such thing as a disruptive technology. There are inventions and new ideas, many of which fail while others succeed. That’s it.” This criticism applies specifically to the low cost disruption model, but it is nonetheless a valid perspective. If you adhere to Dvorak’s refutation, disruptive technology is simply another term for an innovative idea.

Increasing Innovation Resources

• Is lack of innovation keeping you stuck? Lisa McLeod of Huffpost Business considers which factors influence innovation and provides some guidelines for improving innovation. Some of the recommendations she makes include training yourself to ask more appropriate questions and seeking out those who are unlike you.
• In The Myth of Technology, John C. Dvorak expounds on disruptive innovation, which he calls “the biggest crock of the millennium.” Oft cited examples of such technologies, are rarely, if ever disruptive, according to Dvorak.
• Francis Gouillart expresses the need for companies to introduce customers and other outside sources to their work. Opening up the lab and engineering department for consumer oriented mediation is an important step towards the future of product development. His article Engagement Platforms Must Enable Co-Creation further explains why this is so.
• Chris Anderson, editor in chief of Wired magazine is interviewed at some length regarding disruptive technology and the impact of new technology on the traditional business world.

At varying stages during your quest to innovate, you will inevitably run into some difficulties. Don’t fret, this is entirely common. What is important, however, is knowing how to respond to these challenges. Your approach to problem solving will determine your ability to continue on your path to innovation glory.

Edward de Bono has created an effective method of problem solving that embraces multiple aspects of any given issue called the six thinking hats. By separating components of an issue, it is possible to examine many different characteristics in a harmonious way. Rather than having a meeting pulled apart by combative egos and emotions, this method asks participants to focus their discussion on different stages.

Paul Sloane explains that traditional thinking is based on adversarial arguments, which result in the involvement of emotion and ego. The six hats thinking system is a parallel approach to thought that utilizes multiple facets. Each hat represents specific aspects of a situation and results in a holistic understanding of that situation. Yes I know what you are thinking and no, you don’t have to actually wear little colored hats. Representing information, emotion, optimism, caution, creativity, and control through different symbolically colored hats, you can run meetings more efficiently. A good starting place is the white hat.

White Hat

At this stage, facts and information are presented. In a business context this might include total sales numbers, legislation, company policies, or possibly what facts you wish to discover. Further, this provides an outline or skeleton of whatever topic you are discussing.

Red Hat

In order to prevent emotion from being a distracting force, discussing it openly in a controlled manner can help you get a feel for the emotional impacts. This validates participants feelings, while helping to identify favorable options.

Black Hat

Caution and apprehensions are voiced at this stage. The possible negative repercussions or  obstacles faced are considered. An example would be something like,  “the market we are interested in entering is not viable,” or “competition will be too strong to overcome.”

Yellow Hat

Using this hat, positive qualities are explored. What are the benefits of an idea or issue? Though it deals with optimism, it remains situated in judgment. An example might be something like, “We would improve our operations’ efficiency.“

Green Hat

Representing creativity, this hat involves adapting, considering alternatives and generating new ideas. At this point, new ideas will be posited. Incorporating findings from other stages, participants review the substantial black or yellow hat findings.

Blue Hat

The blue hat manages the thinking process and asserts control over the discussion. It is the means through which guidelines are enforced.

Such an approach is powerful for running meetings and reaching decisions. By maintaining focus, not allowing arguments to form, and thinking in a parallel manner, participants can better understand different approaches to a problem. Ultimately, it makes meetings quicker and results in better decision-making.

Resources

• Problem solving and creativity Creative and constructive thinking are often left out of classifications of problem solving. So many concepts surrounding problem solving are extremely vague, even to the point where almost any activity could be considered problem solving. Edward de Bono defines what exactly the problem in problem solving is, while also commenting on methods of thought important to the act.

IBM CEO Samuel J. Palmisano states: “The way you will thrive in this environment is by innovating — innovating in technologies, innovating in strategies, innovating in business models.” Innovation is necessary in succeeding in an especially difficult economic environment, but before it is possible, you must learn to develop your ideas.

While it is difficult to come up with plans for innovation, realizing those plans may prove even more challenging. Once you have some innovative seedlings, how can you make sure that they are properly cared for so that they fully develop? In a blog post titled Getting open innovation participation, Andrea Meyer of Working Knowledge addresses how to evaluate these early ideas through personnel; “The solution is to recruit and reward a crowd that helps curate, moderate, vote, and refine ideas even if those participants aren’t idea submitters.” Once you have a collection of plans and ideas, combing through and further refining them will allow for higher level development. What will also help this effort is to make involvement simple and make the progression of ideas easy to check in on. A more inclusive environment may be highly beneficial to your process.

While still developing your ideas, be mindful of what you will need to do during execution. Guy Kawasaki’s The Art of Execution covers what you need to take into account. First of all, ask yourself if what you are developing is meaningful. In other words, is this a needs driven project, or does it address a gap in the market? It’ll be much more difficult to develop a low quality product than one with great implications. As Kawasaki says, “it’s hard to stay motivated and excited about executing crap. It’s easy if you’re changing the world.” Beyond being easier to develop, creating a useful product is much more marketable. The most important quality of innovation is utility.

As you continue to develop, make sure to set concrete goals. Kawasaki points out four characteristics that are necessary for good goals (that they be): measurable, achievable, relevant, and rathole-resistant. Results oriented approaches make it easier to track progress and let you know if you are succeeding or not. Without measure, not only is it impossible to gauge progress, it is more difficult to conceptualize your development. Though it is common to set unrealistic goals in hopes of encouraging greater achievement, setting standards that are conservative can serve as a huge morale boost.

Beyond setting goals for your own reasons, providing tangible results to investors or sponsors will improve their confidence in your project and prevent them from withdrawing funding. If you are unable to show that you have made any progress, it may be difficult for investors to simply ‘take your word for it.’ Setting quality goals is important in achieving good results and honestly developing your ideas.

Resources for Developing Your Ideas

• In How not to implement change in your organization, Skip Reardon of Sixdisciplines.com illustrates processes that are not beneficial for implementing innovation. Too often, organizations don’t involve different types of employees in innovation decision making and the result is a superficial attempt at change.
• Having worked with highly established academic facilities such as MIT and Harvard Business School as well as some industry leading companies such as McGraw-Hill, Andrea Meyer is familiar with shaping effective cutting-edge approaches. Looking outside of the office may prove helpful in coming up with fresh ideas. Diverse concepts are the result of diverse perspectives.

The increased complexity of the modern business world requires that those who take part actively collaborate. It is too difficult to be a master of all and you will find yourself quickly overwhelmed trying to be self-reliant. Inside and outside of the firewall, collaboration is more important than ever before. Social media and internet 2.0 technologies result in a constant state of interconnectedness that will benefit internal and external collaboration efforts.

IBM’s Lotus Connections project is a business oriented social networking platform intended to take advantage of this interconnectedness. In an article titled “Professionals are social too” Vineetha Menon interrogates Jeffrey Schick, VP of IBM’s social software division. The growth of this product is immense, said to be the fastest growing software of any in IBM’s history. Clearly, the need for collaboration is driving business. As Schick states, “I think now people are really looking at it because they understand that if I use these sort of collaboration technologies I can connect people with people, and people with information, easier than before.” Efficient functioning is all about communicating and in order to deal with the complexity of the new normal, social networking applications may be the tool you need.

Mark Fidelman further contributes to the conversation in his Business Insider article, “Why IBM Represents the Future of Social Business.” Beyond their Lotus Connections application, IBM actively promotes the use of social media in supporting sales, communication and recruiting efforts. What’s more important, is that IBM is able to use such platforms in innovative ways. For instance, they recently saved millions by encouraging employees from around the world to translate product manuals. Fidelman summarizes, “IBM was able to significantly reduce the expense and increase accuracy by awarding points to employees who helped translate the documents.  Employees with the highest point totals earned money for their charities.“ A definite win-win scenario, employees raised money for charity, while the company saved a huge chunk of cash. Innovative approaches to collaboration is the future of social media.

When companies are composed of thousands of people in a number of different countries, an online meeting place can inspire collaboration. Another example of utilizing new technologies in order to collaborate can be seen in the global architecture firm Kohn Pedersen Fox Associated (KPF). Spread across six offices around the world, KPF relies on collaboration technology to effectively communicate. Teams separated by thousands of miles can freely work together at anytime. Not only is it possible to work together, newer technologies allow for face-to-face communication. This approach retains the human component of interacting across the internet; people and ideas are not limited to flat text. An interoperable architecture allows for great flexibility, while allowing employees to utilize mobile devices of their choosing. KPF shows us what a technology driven approach to collaboration looks like.

Through innovative appropriations, Web 2.0 and technology based tools achieve much. The goal of such application is to achieve more efficient collaboration. Creating a solid social online presence and remaining socially active can increase business prospects and higher transparency. Internally, it can improve coordination and team cohesion.

Resources for Collaborating

• Sea of cubicles – Heightened levels of interconnectedness and constant availability change the collaborative environment. Though social media has many rewarding qualities, it may be too easy to get distracted and miss the big picture. Finding the balance between information saturation and sharing important details is one of the many obstacles to overcome in the social media arena.
• Better understand the depth of IBM’s internal use of social software through this article written for Informationweek. David Carr explores more of the functions and innovative applications used by Big Blue. By eating their own dog food, or, as Schick puts it, drinking their own champagne, IBM displays its confidence in its systems.
• Cisco’s collaboration blog explains its involvement in KPFs technology intensive approach to sharing information. In a post titled, The workplace of the future is here, their communication technologies are showcased. Beyond the use of social media, availability and interoperability are emphasized. A similar example is made of a small (25 people) firm called Issues Central, which relies on Cisco for its collaborative technologies. What is also interesting is this company’s use of the technology. Their application of such technology varies depending on culture and stage of negotiation.
• The new hotness in the social media and collaboration world, Google+, is juxtaposed with today’s dominant social force, Facebook. SMCAllen compares chatting, posting, and collaborative possibilities for both platforms. How does Google+ meet challenges that Facebook has not?

Determining whether an idea is good or bad (easier said than done) is a necessary process. It is important to accurately assess your ideas, taking into account cost and available resources plausibility as well as consumer needs. Generally speaking, good ideas are those which are: meaningful (ie: arise from a clear need in the market), beneficial (ie: have value) and can be realistically implemented (in most cases). At the same time, differing perceptions and interpretations of these qualities and their necessity are highly debated.

Arguably, good innovation is any innovation that is marketable or generates revenue. If there is money to be made in it, it must be beneficial to someone, right? Maybe not. Though many tout money as the end-all, most recent innovations and inventions are available for free. The internet has resulted in all sorts of practical and valuable products with relatively little pay-off. As Scott Sumner of The Money Illusion states in response to Tyler Cowen’s The Great Stagnation, “the internet might produce all sorts of neat applications that give us endless pleasure and amusement, but without generating much revenue.” While some (like Tyler Cowen) feel that such innovation cannot be good due to its inability to result in revenue. Sumner goes on to argue that many such innovations result in increased consumption. Furthermore such innovation, anchored in meaningful bases, results in progress and “progress will benefit society whether it generates revenue or not.” Depending on how you look at it, progress or economic viability may determine which ideas are good and which are bad.

Policies for achieving innovation are as prone to analysis as innovations themselves. There are a few key misunderstandings that result in bad (read damaging) innovation policies. One of the most prominent (as outlined by Stephen Ezell and Robert D. Atkinson) is enacting policies that undermine the international trading system, ultimately resulting in a negatively influenced global GDP. Despite the prevalence of win-win innovation strategies, Ezell and Atkinson argue, “many countries have embraced mercantilist strategies seeking to realize innovation-based growth through a negative-sum, beggar-thy-neighbor, export-led approach.” Though such strategies result in increased revenue for that specific country, they also result in a distorted global economic system. The implications of such practices are greatly damaging as they create an imbalanced economic environment; “neglecting the opportunity to spur growth by raising the productivity of the non-trade sectors of their economy.” An intense focus on manufacturing for sectors that are based on export often prevents meaningful large-scale development. Raising productivity in all sectors is key in creating sustainable innovation. Innovating responsibly may go hand-in-hand with achieving lasting growth. Limiting zero-sum strategies while favoring well-rounded win-win strategies results in stable economic environments and means not having to deal with a “new” new normal.

Innovation can turn a good company into a great one. In 2001, Jim Collins tracked the innovative approaches of 11 companies that resulted in their rise to success. Though they were able to catapult to prominence, today many of them are where they used to be. From this, it is important to remember that continued success relies on continued innovation.

Resources

• A good idea may be separated by a bad one through an understanding of market context. Even in the face of some exceedingly popular trends, success is not guaranteed. For instance, the fact that Electric cars are catching on but electric carmakers aren’t demonstrates how it can take more than innovation to succeed. If your competition is too great, as seen in the case of independent car makers in the face of Goliaths (such as Toyota and General Motors), attempting to fully develop a “good idea” may be a bad idea.
• The executive summary of Stephen Ezell and Robert Atkinson’s study “The Good, the Bad, and the Ugly of Innovation Policy” is available online. An easy and to the point assessment of their findings allows for a grounding in international innovation policies and their implications. A more detailed understanding can be gained through reviewing the full text of the document.

 

The Prerequisites for Innovation - Shirley Ann Jackson discusses the necessary requirements for innovation to occur. She believes four key components are necessary for innovation.

1. Strategic focus – A strategic focus towards a goal, or enacting innovative processes. This focus can be within a number of different contexts (national, industry, company department) and is responsible for encouraging innovation.
2. Trans-formative ideas – Research, information and developing creative solutions. “A ha” moments.
3. Actualizing ideas – Further developing/refining ideas and introducing them to the real-world.
4. Capital – Of course, capital plays an important role in leading to innovation. Financial capital is not the only important type of capital, though it is a key element. Human capital (human labor and thought) and infrastructural capital (resources for achieving actualization) are necessary.

The Myths of Innovation Carnegie Mellon University hosts this Scott Berkun talk that details innovation through mythological analogies. This video explores the truths of innovation through well-known and amusing examples. Further, creative thinking and innovation can be fostered through habits.

Innovating on a shoestring Harvard Business Publishing offers this interview with Scott Anthony, president of Innosight, that investigates innovation as a necessity. Part 1 of an 8 part series that examines innovation in today’s market, it illustrates that innovation is a manageable process and that can be predicted with some work. Further, in order to make significant progress, it is important to stop low benefit projects in lieu of furthering large scale innovation. Other topics discussed include fostering a culture that is supportive of innovation, innovating by making the world a better place, and how to spot disruptive innovation. (Part 2 Creating a Culture of Innovation)

Fred Hassan, the CEO of Schering-Plough explains that innovation is essential to growth and  vitality in business. Customer focus is especially important to innovation in the future market. Further, he discusses the engines of innovation and what factors promote it. Finally, Hassan explains how to sustain innovation and ensure long-term innovation. He remarks upon the importance of applying technologies and approaches in innovative ways, rather than relying on invention itself.

• Measuring Innovation: A New Perspective – The Organisation for Economic Co-Operation and Development details the broader context and significant factors of innovation. It describes the state of innovation today through the scientific landscape and considers forces that act upon it. Further, this text considers the geographical and financial indicators of innovation as well as its basis in education.
• The Silver Lining – Scott Anthony explores some ways of coping with the “new normal” environment that resulted from the 2008 economic shock. Many approaches to business in such an environment are overly conservative or misguided. In this book, Anthony explains how innovation can be a beneficial opportunity. Beyond simply innovating, innovating in the right way can mean improved resilience.
• Ten Rules for Strategic Innovators: From Idea to Execution – Fundamental principles for overseeing innovative projects are discussed by Vijay Govindarajan and Chris Trimble of Dartmouth’s Business School. Fostering a genuinely experimental environment and knowing when to innovate and when to adopt new practices are among the most important rules for running an innovative project. Making use of case studies from different industries, the authors show how innovation works in different environments.
• The Innovator’s DNA is a microscopic look into innovation and its necessary factors.  It challenges concepts of innovation and argues for behavior and habits that can consistently improve development. Jeffrey Dyer and Hal Gregersen author this text along with the creator of disruptive innovation theory, Clayton Christensen.
• Innovation to the Core – Written by Peter Skarzynski and Rowan Gibson, Innovation to the Core seeks to provide an outline for organization leaders and innovators to build an innovation capable environment. It demystifies concepts of innovation and offers a practical look at its realization. Profitable, sustainable growth can be achieved through consistent innovation.

How is innovation defined? What characterizes it?

Though it is one of the most widely used words in business, its meaning seems to be wide-ranging. What is (or are) the definition(s) of innovation? While some seem content with simple definitions such as Vijay Vaitheeswaran’s “fresh thinking that creates value,” others such as CEO of Urban Mapping, Ian White, are not. In a post titled Defining Innovation on The Economist, he defines innovations as “products, services, solutions or processes that have no logical antecedent and are value-creating to a core audience.” This definition takes into account that innovations are not always new, per se. They can be (and often are) centered on context and timing.

With well over one-hundred significantly different ways of defining innovation, here are a select few:

BusinessDictionary.com: “To be called an innovation, an idea must be replicable at an economical cost and must satisfy a specific need. Innovation involves deliberate application of information, imagination, and initiative in deriving greater or different value from resources, and encompasses all processes by which new ideas are generated and converted into useful products.”

Jeffrey Phillips of Innovate on Purpose: “a set of tools and techniques to help increase growth and differentiation in a market that is rapidly changing.”

According to Businessweek, “innovation is about reinventing business processes and building entirely new markets.” Technological invention is not the standard of innovation.

Cloud Ave: “A change in a product offering, service, business model or operations which meaningfully improves the experience of a large number of stakeholders.”

The OECD: “There are essentially four types of innovation identified in the Oslo Manual for measuring innovation: product innovation; process innovation; marketing innovation and organisational innovation.”

Which practices deter from innovation?

Company policies may significantly influence your company’s ability or inability to innovate. Loss of talent may result from aggressive tactics such as non-compete agreements. Kimberly Weisul examines the negative impacts of non-competes on the retention of innovators in her BNET article Want Your Innovators to Leave?.  Greater strictness often results in un-happy employees who take their creative minds elsewhere.

Carmen Nobel discusses how these contracts dissuade the best and brightest in Non-competes Push Talent Away. Inventors and innovators have little reason to stay in states that enforce such agreements, especially when businesses elsewhere are doing so well. California is among a few of the states that make non-competes unenforceable, which may be partially responsible for such consistent innovation. Professionals, such as Lee Fleming from Harvard Business School, believe that “brain drain” is a result of scaring off highly creative individuals. The co-author of a paper on the subject, Fleming’s research team found that, “the brain drain was especially pronounced among inventors who held multiple and high-impact patents, and among inventors who also collaborated widely—in other words, those who were considered most valuable to innovation in their firms.” Not only do such agreements deter innovation for your business, they could potentially limit your greatest innovation assets.

In the new normal market place, innovation is a necessary characteristic. Outdated conservative or overly stable approaches to business should be avoided. Edward de Bono, an authority in the arena of creative thinking, ruminates on innovation in the contemporary business in his post titled Innovation and the readiness to do something new.  There are many reasons for companies not following creative approaches, and these should be avoided. In order to innovate, it is necessary to be willing to take a risk. In the past, creativity and such willingness were not necessary for success. As de Bono states, “Executives reach senior positions through being good at continuity and problem-solving. You do what you are supposed to do and solve problems that interfere with that doing. The readiness to try new things is not usually a factor in an executive’s success and promotion.” Having been trained in stable approaches to business, established members in senior positions may be especially reluctant to take risks. Continuity is no longer so highly valued; creativity and a readiness to make new approaches are necessary for success.

Why are creativity and innovation so important to business? What challenges do they address?

An IBM survey of 1,541 chief executives marked creativity as being the most important quality to leadership. In order to run a creative company, having a CEO who actively pursues creative solutions is significant. Faced with a poor economy and overwhelmingly complex challenges, many companies feel under-prepared to deal with the current business environment. Frank Kern, the senior vice president of IBM Global Business Services states:

“Coming out of the worst economic downturn in our professional lifetimes — and facing a new normal that is distinctly different … CEOs identify creativity as the number one leadership competency of the successful enterprise of the future… this is entirely consistent with the other top finding in our Study — the biggest challenge facing enterprises from here on will be the accelerating complexity and the velocity of a world that is operating as a massively interconnected system.”

While previously businesses had considered overcoming change to be their greatest obstacle, today, dealing with the extreme complexities of the global market is paramount. A perfect storm of government regulations, shifts in global economic hotspots, continued technological advancement and an ever-changing consumer market drives this need for innovation. Business is continuing to lean towards creativity in all areas in order to address increasing complexity, not excluding their chief execs.

Dealing with the new normal, an experience marked by economic challenge, forces us to do more with less. Steve Ballmer, CEO of Microsoft, discusses how to approach business in such an environment through his post titled Innovation and Recovery at Forbes.com.  He says that, “the answer lies in a renewed commitment to innovation–particularly information technology innovation–from both the public and private sectors.” Innovating allows for a new kind of efficiency that is much needed in order to cope with the drastic changes in our business environments. Information technology is a potential avenue to realize the need for innovation. Facing economic uncertainty, we are required to be more conservative while achieving more.

Is innovation a fad?

Some see “innovation” as nothing more than a buzzword, used by modern snake-oil salesmen to hawk their wares and services. Is such a perspective legitimate? Certainly, following the hype of innovation, there are cases where the trend towards innovation is seen as a niche market to take advantage of. On the whole, is this push towards creativity and innovation a gimmick or business revolution?

In his post titled When will the innovation fad end? Jeffrey Phillips of Innovate on Purpose establishes innovation as a fad. Comparing it to the Pet Rock, Phillips explains that management circles are just as susceptible to fads as popular culture. Even as a fad, however, he concedes that this trend does something others don’t, “unlike Cabbage Patch dolls, Pet Rocks or bell bottoms, innovation does something that many fads don’t:  add value.” The bottom-line is that factors that are responsible for the creation of this fad, “growing consumer demand, an expectation of new products and services, rising global trade and the increasing knowledge of consumers,” are quickly accelerating. What’s more, is that all of these qualities increase competition. In this way, innovation is the means to “sustain the new normal,” through responding to increased demand and consumer needs. Those who ignore innovation will be surpassed by their competitors.