What Does “Innovation” Mean? Many Things.Reply
A friend recently said he didn’t know that when I talk about innovation I am referring to improvements in processes, workflows, and efficiency, in addition to new product and service development. So, let me set the record straight.
According to The American Heritage Dictionary (2006), “innovation” is defined as:
n. 1. The act of introducing something new. 2. Something newly introduced.
In Oxford American, it’s:
Change, alteration, revolution, upheaval, transformation, metamorphosis, breakthrough; new measures, new methods, modernization, creativity, ingenuity, inspiration….
So, as the terms "new methods" and “new measures" don’t exactly indicate radical marketing breakthroughs or revolutionary unique products, being innovative can simply mean applying ideas to doing routine procedures in somewhat more efficient or more effective ways.
Making Improvements in Processes vs. "Process Improvement":
The term "process improvement," for some, brings a system like “Six Sigma”* to mind. Although there is resounding evidence that formal programs such as Sigma have made significant contributions toward achieving greater efficiency and eliminating waste, this sort of system has been found to be detrimental to the creative process in research and development departments, such as the one at innovative 3M, as reviewed in an interesting Business Week article.
Many of us would agree that it's a matter of balance, and one solution certainly does not fit all situations. Of course, R&D programs should discipline themselves to be as efficient as possible in their planning, collaboration and communication processes, in vetting ideas, and rapid prototyping, without being hindered by some of the Six Sigma-type constraints.
K.I.S.S. (Keep It Simple, Silly!): For some of us, the term “process improvement” simply means what it always has: modest improvements in how we do things. Such as, “Let’s start writing the dates completed on the boxes that we’ve sorted through so no one wastes time going back through them.” It can be any “new method” that’s never been done before that helps us to achieve greater efficiency in our workflows or improve quality – like the 100+ ideas that each Toyota employee is encouraged to contribute to their company every year.
Most of us have numerous process and work-flow improvement ideas pop into our heads at work all the time. As Langdon Morris has written, part of innovation involves the creative tension of “seeing things as they are and things as they could be.” Unfortunately, many people are not empowered by their employers to share their suggestions, let alone see them discussed or implemented. This all too common situation is a tremendous waste of brainpower and resources, frustrates employees, and contributes to low moral and higher turnover.
Many Forms of Innovation:
At a conference on innovation, Brownell Langdrum of Draw Success (www.DrawSuccess.com) supplemented her own list of types of innovation with ideas generated by a group of chief innovation officers from companies such as Google, Mattel, and Hewlett-Packard. A few of these are included below. If you go to her full document, you will find that some of the descriptions are, fittingly, quite original. Actually, the list itself could be a very useful tool for generating ideas!!
Efficiency innovation delivers ways to improve efficiency and the speed of effectiveness. It can include internal systems and processes or ways to expedite the customer/client experience.
This form of innovation conveys ways to increase sales, reduce costs, improve tracking of expenses, and reduce accounts receivable, along with other ways of managing finances to enhance profitability. It also includes ideas to improve tax/audit compliance.
Process Innovation encompasses the implementation of a new or significantly improved production or delivery method.
Note: I’m a big fan of efficiency, so I believed that process improvements imply greater efficiency. But, it was pointed out to me that changes that improve quality do not always result in greater “efficiency,” in that these can slow speed of operations down. I think the argument can be made that improvements in quality are ultimately more efficient uses of time and effort, but for now, I yield to these as being two distinct forms of innovation.
This form of innovation includes introducing a new infrastructure or system, which could produce new sectors, and induce major change across several areas of business.
Breakthrough, disruptive or radical innovation:
These forms of innovation involve launching entirely novel products or services rather than providing improved products and services along the same lines as currently marketed. Breakthrough innovations are rare because of the risk and uncertainty, but they can deliver tremendous rewards. They require large leaps of thought and a high-risk tolerance.
Business Model Innovation:
Business model innovation involves changing the way business is done, whether in terms of sales and distribution, marketing, pricing or any other core business strategy.
This is when one adds something extra to a product or service that the competition doesn't have or isn't doing. Or, when one makes something last longer, more convenient or faster.
This involves development of new marketing methods with improvement in product design or packaging, product promotion, communication or advertising, pricing or distribution.
Product innovation is the introduction of a good or service that is new or substantially improved, which may include improvements in functional characteristics, technical abilities, ease of use, or any other dimension.
Service Innovation, compared to goods or product innovation or process innovation, delivers ways to improve the delivery of a service or expertise and is both interactive and information-intensive.
This may include coming up with new technologies to solve a problem or new uses for existing technologies. Solutions may be high-tech (i.e. computer systems) or low-tech (a better mouse trap).
In summary, when I use the term “innovation,” I mean a range of ways of putting good, new ideas into action within operations, workflows, and processes as well as in the marketplace and in solving social, environmental, and economic issues. The organizations that will survive and thrive in this rapidly changing environment welcome and apply ideas on a wide range of topics – the more the merrier!
* Wikipedia: Six Sigma is a business mangement strategy originally developed by Motorola, USA in 1986. As of 2010, it is widely used in many sectors of industry, although its use is not without controversy. It seeks to improve the quality of process outputs by identifying and removing the causes of defects (errors) and minimizing variability in manufacturing and business processes.
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