Innovation is one of the most misused words in the business vocabulary. There is widespread confusion between innovation and invention. Invention is the creation and development of new ideas. Innovation by contrast is the development and successful commercialisation of new ideas. Thomas Edison was an inventor with hundreds of patents to his name; the light bulb was an innovation because the idea was successfully commercialised. Thus, while innovation is dependent on invention it is the business activities to deliver application of the invention and the full scale commercialisation that are important.
Innovation is widely regarded as a key driver
of growth in the economy and critically in individual businesses. Businesses supplying innovative products and
services have the unique selling point which create a market, encourages growth
and support sustainable sales.
Innovation is a success and is therefore likely to be subject to
imitation. This fact has two corollaries:
there is a need to protect the underlying invention from imitation, theft and
other competitor actions with patents, copyrights, trade marks etc.; and one
innovation is unlikely to be the enduring basis of a successful and growing
business, not least because the patent monopoly expires opening the market to
competition – an innovation portfolio needs to be developed, managed and
exploited to keep your business ahead of the game. As demonstrated by Edison
who had a range of innovations around his light bulb.
Innovation is a critical business process for
ambitious enterprises. An invention may be the foundation of the business;
initial growth will be dependent on successful business development based on
this idea: innovation. Subsequent
growth, will require further innovations, some of which may be large – the
development of entirely new products, others may be small – further critical
refinements of the initial product in response to market feedback. Whatever the case, innovation needs to become
an established process within the business to ensure sustained growth. Innovative companies can cease to innovate
and die, as demonstrated by swathes of manufacturing industry in the UK.
Established, even traditional businesses can
be innovative; indeed in a crowded and competitive market place innovation is
vital. Flag carrier airlines fly between
major cities paying significant landing fees at major airports and struggle to
be profitable; what chance would there be for a small independent player to
enter the market? Low cost airlines fly
to regional airports, where regional development agencies subsidise landing
fees allowing these service innovators to charge significantly lower fares and
drive the growth of their businesses.
Innovation is for all and certainly for all who want to be successful.
Innovations may be made in product, process,
service or management; wherever the innovation is made it gives commercial
advantage. Having secured advantage a
high growth business will maximise exploitation of its position and seek
further innovations to reinforce its long term prospects. One has only to look to the likes of
Microsoft and Apple to see this process at work and to appreciate the impact on
the business if innovation is put at the very core of the business.
An Extract from the Oxford Innovation book: "One Hundred Ways to Grow your Business"
Edited by Dr Huw Edwards and Geoff Ribbens
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