What is Innovation? - A look into the world of Innovating.

When a person is asked to define innovation, it is very rare that they will have one single answer that defines innovation perfectly, as it is such a broad and varied concept. Trott makes an excellent point in stating that despite the fact that the term innovation is ‘widely accepted’, it is ‘unknown to what extent the understanding of innovation is shared’ (p4, 2002). This is an interesting statement as it has highlighted the fact that innovation may be seen differently by people in different situations, for example; a scientist and an artist’s view on innovation will most likely be vastly different. So for the sake of personal relevance, I am going to explore the theory behind innovation in terms of Business.    

Innovation is the use of knew knowledge to offer a new product of service that customers want (Afauh, 1998, p13). Westland describes innovation to be a ‘product of service with a bundle of features that is new in the market’ (p6, 2008), or a product that is ‘commercialised in a new way that opens up new uses and consumer groups’ (p6,2008). These definitions are essentially saying the same thing, that innovation in some way brings new ideas and turns them into something that the customers and the market want. Conway and Steward extend these statements by saying that innovation ‘is not a single action’ (p10, 2009). They state that it is ‘a total process of interrelated sub processes, that eventually leads to successful exploitation of ideas’ (Conway and Steward, p10,2009).

Afuah states that innovation takes two forms within a Business. Firstly there is Radical innovation; an innovation is said to be radical if ‘the technology required to exploit it is different to existing technology, rendering existing technology obsolete’ (1998, p14). An example of this may be the likes of AOL’s instant messenger. AOL was the first to launch an internet wide GUI based messenger service in May 1997. For many internet users this provided a revolutionary new way to communicate in real time between two or more computers / electronic devices (innovation-creativity.com).

The second for of innovation is incremental innovation. The knowledge required for this ‘builds on existing knowledge’ (Afuah, 1998, p14). And example of an incremental innovation is Intel’s Pentium 4. Intel introduced the Pentium 4 computer processor chip as an incremental improvement to the Pentium 3 chip. Both chips had the same basic technology but the Pentium 4 introduced new design improvements and additional features to improve the chips overall performance (innovation-creativity.com).  

These innovations suggest that the product created is ‘so superior that that existing products are rendered non competitive’ (Afuah, 1998, p15), this is an example of the professed ‘economic competitiveness view, and is displayed in the diagram below (Afuah, 1998, p15)

References

 

Afuah, A. (1998). Innovation Management: Strategies, Implementation and Profits. New York: Oxford Press University Inc.

Drucker, P F. (1985). Innovation and Entrepreneurship. Oxford: Butterworth-Heineman. 

Conway, S. Steward, F. (2009). Managing and Shaping Innovation. Oxford: Oxford University Press.

Trott, P. (2008). Innovation Management and New Product Development. Fourth Edition. Harlow: Pearson Education Ltd.

Westland, J C. (2008). Global Innovation Management. Hampshire: Palgrave Macmillan.

Innovation Creativity. (2010) Radical Innovations. [online]. Accessed from: http://www.innovation-creativity.com/radical-innovation.html [Accessed: 27 October 2011].

Innovation Creativity. (2010) Incremental Innovations. [online]. Accessed from: http://www.innovation-creativity.com/incremental-innovation.html Accessed: 27 October 2011].