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Sunday
Jun302013

A modest proposal: A new definition of innovation.

Innovation is a one the great Rorschach words.  Nearly everyone defines it a bit differently.  It has been overused, (293,000,000 results on a single Google Search) over-hyped, and often misunderstood.

At Solution People in Chicago, leading innovation coach Gerald Haman defined it as simply as “ideas that create value.”  Behind that verbal tip of the iceberg was a lifetime of teaching the creation and implementation of ideas and an even deeper understanding of what value means the consumer and social marketplace.

Why is defining the word "innovation" so important to innovation teachers and purveyors of the gospel of innovation?

There are a handful of Fortune 500 companies who have elevated innovation to an art form (Apple) and other Fortune 500 companies who have been seriously burned by failed innovation efforts.  So imagine standing up in front of both groups and saying the word “innovation” and you’ve already divided your audience. 

It’s the Rorschach effect.

So innovation teachers try to define it precisely to get buy in to talk about process.

For example, Larry Keeley and his co-authors (Ryan Pikkel, Brian Quinn, and Helen Walters) have written an excellent book Ten Types of Innovation.  Their definition: “Innovation is the creation of a viable new offering.”  This seemingly simple definition has an additional four call outs to further explain what they mean behind each of these words.

It’s simple and if you do even a modest deep dive in the book, it’s an excellent working definition. In fact, it shineswhen discussing the first six of the innovations which are focused on the innermost workings of a business. (i.e. profit model, network, structure, process, product performance and product system.)  

Do we really need to add yet another definition to the lexicon?

In my seminars, I have used a definition of innovation that I have evolved over the years.   In 2007, I was inspired by Jim Kilts’ book, Doing What Matters:  How to Get Results That Make A Difference.

It’s easy to describe Kilts’ book (as articulated by Wally Bock) “what goes on in an experienced CEO's head when he takes over a company that needs to turn around."

Jim Kilts was a successful CEO at Kraft and led turnarounds at Nabisco and Gillette.

My innovation definition:  Creating what matters.

Like Keeley et al, it needs a deeper dive or context.  The difference?  “Innovation as a viable new offering” and “creating what matters.”

Keeley would argue that viability means “returning value to you or your enterprise.”  The definition is based on two criteria:  “the innovation must be able to sustain itself and return its weighted cost of capital.”

As good a definition as it is, I see it as company or entrepreneur centric.  My definition is customer centric.

The innovation must matter to the customer – somewhere along its evolution from idea to product or service. 

Take Pixar for instance.  They pioneered many advances in CGI animation. But would they be considered an innovation in 1979 when the original company was founded? Or when they released Toy Story in 1995?  In a span of over a decade it neither returned a value or cost of capital. Keeley, et al, did not put a time limit on when an innovation is sufficiently anointed, but it is easy to see how limiting that definition can be.

Creating what matters (audience centric) is also limiting, but I feel it offers a slightly more flexible approach to thinking about innovation. 

In the Keeley definition, Pixar would not technically be an innovation until Toy Story.  In my definition, the audience of advertisers (through commercials) and the audience of one (Investor Steve Jobs) was technically an innovation earlier in its evolution.

Another compelling case.  Eienstein's Theory's.  Most of his theories were published in 1905.  They did not meet any of the criteria of Keeley's definition. So these ideas were not innovations until nuclear power was advanced in the 1940s.  But I do believe that these innovations of thought were accepted much earlier by an audience of physicists.  

Both definitions are worthy of discussion and improvement. And Ten Types of Innovation is one of the best books on innovation you'll find today.

I welcome your feedback at inotivity@gmail.com

Happy innovating.

 

 

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    Creativity Central - Creativity Central - A modest proposal: A new definition of innovation.
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    The measure of innovation at the hierarchical level identifies with people, group level evaluations, and privately owned businesses from the smallest to the largest.
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