Meaning of Innovation

Innovation can be observed as an implementation of ideas that originate from creative processes. Innovation is the embodiment, combination, and/or synthesis of knowledge in original, relevant, valued new products, processes, or services. It can be defined as the process of translating a novel and creative ideas or invention into a good or service that creates value or for which customers will pay. Creativity is a process you employ to improve your problem-solving. So you're not done until your creative efforts have produced a product, service, or process that answers the original need or solves the problem you identified at the outset. It relates to the commercialization of creative invention which occurs if someone improves on or makes a significant contribution to existing products, processes, or services.

Most successful innovation is the result of a conscious, purposeful search. Some areas represent more fertile ground than others. Innovation is thus the oxygen and core process of entrepreneurship.

Different ways in which innovation can be described:

Innovation Described in Words:

• Original
• Unexpected
• Fresh
• Thinking Differently
• Never been thought of before
• Never been seen before
• Creative
• New
• Useful

Innovation Described in Reactions:

• Isn't that clever
• What a great idea
• I'll actually buy this thing
• Why didn't anyone ever think of doing if before?
• Challenging conventional notions of how things have been done before
• Bringing ideas from one industry to another, or from one geographic region to another
• Creating meaningful points of difference for products and services vs. current alternatives
• Fulfilling unmet consumer needs, by offering new ways to accomplish goals;
• Making lives or jobs easier, better, happier, more exciting, satisfying, or more productive
• Enabling brands to compete in new markets or category segments
• Delighting/ engaging/capturing imaginations of consumers to increase loyalty

Types of Innovation

Innovation motivates improvements in the functioning of an organization/business and contributes to its success.

Different types of innovation are recognized depending upon the criteria of classification. For example, when the classification is based on the object of innovation, then the types may include product/service innovation, business model innovation, process innovation, technology innovation, etc. When the extent of change is the basis of classification, then the types may be radical innovations and incremental innovation.

Whatever the classification basis, the four core innovation types are briefly discussed below:

1. Invention:

The invention can be defined as the creation of a new product or new services or the introduction of a new process for the first time. An invention is a unique or novel device, method, composition, or process. So from an organizational standpoint, it’s always important to think five years and ten years out and to be continuing to try to push that envelope even though there may not be a customer today. Innovations that may not benefit customers today could meet their needs tomorrow.

Examples: Wright Brothers-Airplane; Thomas Edison- Light bulb; Alexander Graham Bell-Telephone, Steve Jobs starting to develop the smartphone world with the iPad, Marie Curie made great researches on radioactivity, etc.

2. Extension:

The extension can be defined as new use or a different application of an already existing product, service, or process.  In extension, you are no longer trying to figure out problems but helping people solve new problems and coming up with new ways of doing things. Most innovation happens here, because most of the time we are seeking to get better at what we’re already doing. We want to improve existing capabilities in existing markets, and we have a pretty clear idea of what problems need to be solved and what skill domains are required to solve them. A possible downside is that incremental innovations do not necessarily make a huge impact because they’re often just slightly better than what is already out there.

Examples: The development from the mainframe computer to the desktop, then the laptop, and more recently the notebook computer. Companies such as Amazon have become masters at this, with continuous experimentation of their web interface resulting in daily optimization of the user experience.

3. Duplication:

Innovation is the outcome of creativity and manifests itself as the fresh changes that are implemented in products, processes, or services. Duplication can be defined as the creative replication of an existing concept. It utilizes your existing technology and increases the value to the customer (features, design changes, etc.) within your existing market.  Almost all companies engage in incremental innovation in one form or another.

Examples: The application of the franchise model of business worldwide, from the fast-food industry to the education sector.

4. Synthesis:

It can be defined as a combination of existing concepts and factors into a new formulation or use. Most innovations are the result of a conscious, purposeful search, not sudden illumination. Most innovations are not so much the product of sudden insights as they are the result of a conscious process that often goes through multiple stages. This innovation is amazing at increasing new customers as long as the new market is receptive.   Most of the time, the risk involved in synthesis is low due to the reliance and reintroduction of proven technology. Though most of the time it requires tweaking to match the requirements of the new market.

Examples: The fax machine, which is a combination of existing technologies giving rise to a new product technique (telephone+ photocopiers= fax)