What really is innovation?

29 September 2016

What really is innovation?

Innovation SuperNetwork CEO, Simon Green shares his thoughts on what innovation is really about. 

I’ve spent most of my adult life working on innovation projects. Like anything you do all the time, it’s easy to become so immersed in what you’re doing that you don’t always see how it fits with the wider world. One of our partner organisations, the North East England Chamber of Commerce, commented recently that many of their member businesses don’t see themselves as innovative despite the fact that they are constantly looking to improve their products and services and grow into new markets. This got me thinking: what is innovation really? When does the day-to-day problem solving which happens in every business become innovation? What’s the difference between innovation and invention?

First of all, I should explain why I think this matters. There is a raft of academic studies indicating that businesses that are more innovative tend to be more successful. They also tend to be more able to respond to external change, which means that they survive through difficult times that might kill their competitors. So, assuming that ambitious businesses want to be more successful, we should be helping them to be more innovative. This means we have to know what ‘innovative’ means.

Innovation is not invention. As Hans Möller (Innovation Director at the North East LEP) has argued in the past, Google Glass is not innovative. It is an invention that has not led to commercial success or social good, so isn’t an innovation. By contrast, the windscreen wiper (arguably invented by Capt. Gladstone Adams of Whitley Bay) is a lot less clever than Google Glass but is a true innovation; it has sold in its billions whilst improving road safety. I think this is a useful criteria; has the new product, service or process you’ve invented changed something for the benefit of an individual, business or society? If so, it could truly be thought of as innovative.

Even great innovators can miss out from time to time. Thomas Edison was involved in the development of hugely successful products (leading to the global giant that is General Electric) but famously invented many things that didn’t make it to commercial success, such as a concrete piano.

Innovation is a specific type of problem solving. One of the comments from the Chamber was that their members see themselves as simply doing their day jobs in solving problems. Innovation can quite helpfully be seen as problem solving. It is about coming up with new (or improved versions of current) products, services and processes that offer an advantage over what already exists. The improvement could be in cost, in functionality, in speed or anything else. Developing such an improvement means overcoming issues with current systems, essentially it means solving problems.

There is though a difference between the sort of day-to-day problem solving every business has to do and innovation. Take the example of an architect. They will be working every day on adapting design ideas to unusual spaces, planning restrictions and client desires. This type of problem solving is their day job and I wouldn’t describe it as innovation; it is following a well-trodden path to reach an outcome using tools and knowledge that the architect already possesses. Innovation is a specific type of problem solving that requires a new path, new tools or new knowledge and where the solution can’t be predicted from the start.

Innovation doesn’t have to be ground-breaking to be successful. Sometimes there is a perception that only businesses undertaking radical innovation are really innovative. Radical innovation is where new technology and new business models combine to create something that disrupts an entire market. Most businesses though don’t work in this way, but rather develop incremental improvements to current products. They may occasionally develop refinements to their business model or technical base to achieve an advantage versus competition but it’s very rare to successfully change business model and technology at the same time.

In fact, attempting radical innovation in a small business is a very high risk approach. Incrementally improving current products, processes and services is likely to be more successful for most businesses than betting everything on the next big thing.

Taken together, I think these points help to demonstrate what we can do to help North East businesses innovate. We don’t have to massively change what they do, given that innovation is closely related to the problem solving businesses already do day-to-day. And we don’t need to push businesses to be at the forefront of new invention, as they may be better focused on incremental improvements anyway. Instead we should focus on encouraging businesses to always look to improve their offer (even by a little), to be open to new ways of doing things and emphasise the commercial (social) impact of what they do.

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