"Innovation" is as big of a buzzword as "big data" -- and just as hard to define. Blame it on the very nature of innovation: to innovate means to create change, which, by necessity, implies breaking rules, making mistakes and upsetting the status quo. So how do you define change … and, more importantly, why should you bother?
Canyons of Manhattan/Photo by Asa Aarons
You can't look at a conference agenda without stumbling on something related to innovation. Go ahead. Glance at the bios of the keynote speakers at Eloqua Experience North America in San Francisco this week. Or scan our coverage from FutureM in Boston or the DEMO 2013 Conference in Santa Clara, CA last week.
All of them focus on new ideas, methods and products … on doing things differently, uniquely, innovatively. " Innovation," as business consultant Tom Peters so appropriately explains, "is a messy business."
It doesn't often fit neatly among the objectives employees develop as part of their annual performance reviews -- and only a small number of companies officially allow employees to set aside time to innovate during their normal workdays.
In fact, innovation often happens in the process of doing something else. "Around here, we try things first, fix 'em fast, try again, talk about it later, when we've got something to talk about," Peters writes.
The big question: What exactly does a company that encourages innovation want to accomplish -- and how does it want to reach its objectives? Is innovation more than a buzzword?
Hard to Define
There is no standard definition for innovation, even though many corporate executives describe it as a key corporate value. However, one of the broadest definitions is "A change in a product offering, service, business model or operations that significantly improves the experience of a large number of stakeholders."
"Innovation, unlike audits or reengineering, is not given to systems, formulas and blueprints," noted Mitchell Ditkoff, co-founder and president of Idea Champions, a management consulting and training company. It is given to people -- restless, inspired, fascinated individuals with an almost cellular need to change. And while it can be supported by systems, it can never be reduced to systems.
Because innovation is chaotic, unplanned and serendipitous, companies should be careful about how much order, discipline and oversight to impose on individuals who bring urgency and initiative, warned Michael Schrage, a research fellow at MIT Sloan School's Center for Digital Business, and the author of "Serious Play" and "Who Do You Want Your Customers to Become?" He thinks innovative organizations need to be innovative about how they innovate.
Rewarding Out-of-the-Box Thinking
His suggestion: Senior management should quietly recognize and reward informal and bootleg efforts that unambiguously contribute to positive outcomes. Encourage intrapreneurs and project teams to identify the one non-compliant or outside-of-the-box informal innovation effort that worked best for them. "Don't think of informal innovation as inappropriate or illegal. Treat it as undocumented," Schrage suggests.
Any tools, technologies, techniques or toys that let people improve how they play with uncertainty improved the quality of innovation. And he adds, “The ability to align those improvements cost-effectively with the needs of customers, clients and markets dramatically boosts the odds for competitive success."
Gifford Pinchot, author of "Intrapreneuring," defines intrapreneurs as in-house entrepreneurs. They're the "dreamers who do" in a corporation, and can increase the speed and cost-effectiveness of technology transfer from R&D to the marketplace.
In most organizations people are thought to be either dreamers or doers. Both talents are not generally required in one job. But the trouble with telling the doers not to bother about their dreams is that they dream anyway. When they are blocked from implementing dreams of how to help your company, they're dreaming dreams of revenge."
Almost everyone agrees that the successful businesses of the future will be complex, adaptive, agile, proactive and creative. They won't wait for market demands to change them, but will instead continuously reinvent their companies, anticipate future demands and make strategic, risky, value-creating investments and decisions.
Winston J. Brill, an innovator turned business consultant, said it's important for corporations to understand the innovation process. Very few innovative ideas, for example, originate in meetings.
Brill won several international awards, including the Eli Lilly Award for outstanding work in microbiology and immunology and the Alexander von Humboldt Foundation Award, one of the most prestigious awards for agricultural research in the United States, before forming a consulting firm in 1989. Since then, he's focused on the role of innovation in the workplace.
He found that people working independently create the majority of ideas that lead to successful product introductions: 43 percent of ideas occurred while the person was alone, 18 percent during informal discussions with several people, and just 2 percent during scheduled meetings.
However, initiation only refers to the initial spark of invention. It’s rare that a single original idea becomes the master plan for a successful new product or service. Raw ideas need to be developed, expanded upon, analyzed and tested in order to extract high quality, implementable concepts -- and that process takes place most effectively through collaboration, even though the original concepts may have been created by a single person.
But are companies taking advantage of the talent on their teams? Nigel Colin, an Australian creativity coach, thinks not. He estimates as many as 75 percent of business leaders fail to utilize the talents of their creative people to the fullest, which means lost opportunities and poor innovation.
Step Out of the Shower
The real challenge facing businesses is not in finding creative people or teaching your people how to be more creative. It's in knowing how to lead your creative people and innovative thinkers. It is knowing how to tap into their talents, harness their genius and direct it towards viable commercial results, Colin said.
To innovate is to embrace calculated risk, with the understanding that very few ideas succeed. Many more ideas fail, as even successful innovators like Nolan Bushnell best known as the inventor of Pong, will concede.
Bushnell once remarked, "Everyone who has ever taken a shower has had an idea. It's the person who gets out of the shower, dries off and does something about it that makes a difference."
How can companies encourage employees to “do something" -- and transform ideas to useful, marketable products and services?