Innovation: definitions

While writing a dissertation on Taiwanese firms' innovation strategies in international markets, I collected over 20 definitions of innovation from various books and journals (this took me forever). As you would expect, innovation means different things to different people.

Here are eight formal definitions of innovation from various sources (I haven't included the page numbers here):

1. " . . . introducing new commodities or qualitatively better versions of existing ones; finding new markets; new methods of production and distribution; or new sources of production for existing commodities; or introducing new forms of economic organization." (Schumpeter, 1942)

2. "An innovation is an idea, practice or object that is perceived as new by an individual or other unit of adoption." (Rogers, 1995)

3. "The intersection of invention and insight, leading to the creation of economic value." (U.S. National Innovation Initiative, 2005)

4. "An innovation is anything new that is actually used (enters the market place) - whether major or minor." (von Hippel, 2005)

5. "The adoption of an internally generated or purchased device, system, policy, program, process, product, or service that is new to the adopting organization." (Damanpour, 1991)

6. "Creating new and better ways of doing things that your customers value and that create value for your shareholders." (George et al., 2005)

7. "A new way of doing things . . . that is commercialized." (Porter, 1990)

8. "The successful exploitation of new ideas." (U.K. Department of Trade and Industry, 2003)

"I never could believe that Providence had sent a few men into the world, ready booted and spurred to ride, and millions ready saddled and bridled to be ridden."

- Richard Rumbold (1685)

To be perfectly honest, I think the theory of innovation is quite well developed in 2008. What is often missing is the will. What do you think, is there anything that we still don't know about innovation? What areas need further exploration?

The primitive brain

There are many lateral thinking puzzles out there and I'm sure many of them are familiar to people interested in innovation management. Here's one that I have used quite a lot from the founder of the Destination-Innovation Web site:

"A man has a business where he buys chairs for $5 and sells them for $4 and becomes a millionaire. How come?" (This one always produces come interesting solutions. If you want one possible answer, go to the bottom of this post.)

This type of question reminded me of a couple of sentences that I saw years ago to show how schema can affect our reading comprehension. Read these sentences. Who's speaking? What are you imagining? You can get the endings at the bottom of the page:

A: "She was your typical blonde, she kept her nails . . . "
B: "Barrabus came by sea . . . "

So what's the point of using stuff like this? They can illustrate very clearly that our existing mental models/assumptions can be way off the mark -- miles off, and prevent us from solving today's complex problems. Another danger is equating experience and expertise with being right. And worse, equating confidence with being right. Have you ever noticed that all those talking heads on financial news channels talk with such confidence and, yet, at the end of the day, they don't really know what the hell is going on any better than the next man. Suit, loud voice, MBA and you've got it all figured out.

This is why I like Richard Branson so much: long hair, soft spoken, a little bit scruffy and not taking himself too seriously.

There's one more. Ignoring the lessons of history. Together, we have the toxic three: 1) confidence in lieu of substance 2) over emphasis on expertise and 3) an aversion to the lessons of history.

Answers:
The man had previously been a billionaire. [We assume that becoming a millionaire is a bottom-up process.] Of course, with today's stock markets being so low, a top-down path to having a million makes perfect sense.

A: ". . . all neatly lined up in jars in her basement."
B: ". . . his feathers were so dirty and ruffled after the long trip." [The text was taken from a young girl's diary about her canary arriving at the new family home in another country.]

Got any other good lateral thinking puzzles?

[Link]: The Economist writes about America and innovation.

Two become one: content and ads

Do you remember when the line between a movie or television show and the ads was quite clear? Not so nowadays. Ads guised as content are widespread on the Web (check out some of the stuff on Yahoo's home page, for example). It's also evident on YouTube: "I used a [insert brand name] to take this video. Cool." And Blogs, too: I was asked recently to write a "review" of a company's new product by some marketing outfit. I declined not because I thought it is wrong, I just wasn't that interested in pretending to like something that I knew nothing about.

Last night I watched Run Fatboy Run with my wife. This film was quite enjoyable, but I started to notice that the "theme" of the movie and the brand represented frequently in the movie, through placement of the logo, were one and the same. The movie plot was highly formulaic in the sense that it contained many of the elements discussed by Joseph Campbell. There was the hero, the bad guy etc. etc. The plot was basically about a guy (the hero) who ran away from his pregnant girlfriend at the alter (separation) only to get jealous when he learns she has a new lover (the bad guy). The new guy is an avid marathon runner and with a race coming up, you can guess what happens next. The hero decided to train for and run in the marathon. During the marathon, the hero was tripped up by the bad guy but still manages to break through "the wall" (transformation) and finishes the race -- winning his girlfriend back in the process (return). Which sportswear brand does this storyline suggest to you?

Now there's nothing wrong with formula in storytelling. Most stories contain similar key elements and motifs, but the question I had when I watched this move was: which came first? Were the Nike placement ads built around the movie plot or was the movie plot built around the story embodied in the Nike brand? One thing I would bet on is that this movie involved close collaboration between the movie makers and the Nike marketing team.