Difference between revisions of "Innovation" - New World Encyclopedia

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[[Image:Innovation.JPG|right|thumb|250px|A personification of innovation as represented by a [[statue]] in [[The American Adventure]] in the World Showcase pavilion of [[Walt Disney World]]'s [[Epcot]].]]
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The term '''innovation''' means “the introduction of something new,” or “a new idea, method or device.” Innovation characteristically involves [[creativity]], but is not synonymous with it. Innovation is distinct from invention and involves the actual implementation of a new idea or process in society. Innovation is an important topic in the study of [[economics]], [[history]], [[business]], [[technology]], [[sociology]], [[policy making]] and [[engineering]]. Historians, sociologists and anthropologists study the events and circumstances leading up to innovations and the changes they bring about in human society. Social and economic innovations often occur spontaneously, as human beings respond in a natural way to new circumstances. Since innovation is believed to drive economic growth, knowledge of the factors that lead to innovation is critical to [[policy]] makers.
  
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{{otheruses}}
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In organizations and businesses, innovation is linked to performance and growth through improvements in efficiency, [[productivity]], [[quality]], and [[competitive positioning]].
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{{Nofootnotes|date=November 2007}}
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Businesses actively seek to innovate in order to increase their market share and ensure their growth. A successful innovation does not always bring about the desired results and may have negative consequences. A number of economic theories, mathematical formulas, management strategies and computer business models are used to forecast the outcome of an innovation. Innovation leading to increased productivity is the fundamental source of increasing wealth in an economy. Various indices, such as expenditure on research, and factors such as  availability of capital, human capacity, infrastructure, and technological sophistication are used to measure how conducive a nation is to fostering innovation.  
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[[Image:Innovation.JPG|right|thumb|250px|A personification of innovation as represented by a [[statue]] in [[The American Adventure]] in the World Showcase pavilion of [[Walt Disney World]]'s [[Epcot]].]]
 
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The term '''innovation''' means a new way of doing something. It may refer to incremental, radical, and revolutionary changes in thinking, products, processes, or organizations. A distinction is typically made between Invention, an idea made manifest, and innovation, ideas applied successfully. {{Harv|Mckeown|2008}} In many fields, something new must be substantially different to be innovative, not an insignificant change, e.g., in the arts, economics, business and government policy. In economics the change must increase value, customer value, or producer value. The goal of innovation is positive change, to make someone or something better. Innovation leading to increased productivity is the fundamental source of increasing wealth in an economy.
 
  
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Innovation is an important topic in the study of [[economics]], [[business]], [[technology]], [[sociology]], and [[engineering]].  Colloquially, the word "innovation" is often synonymous with the output of the process.  However, economists tend to focus on the process itself, from the origination of an idea to its transformation into something useful, to its implementation; and on the system within which the process of innovation unfolds.  Since innovation is also considered a major driver of the economy, especially when it leads to increasing productivity, the factors that lead to innovation are also considered to be critical to [[policy]] makers.  
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==The concept of innovation==
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The term “innovation” dates from the 15th century and means “the introduction of something new,” or “a new idea, method or device.”<ref>[http://www.merriam-webster.com/dictionary/innovation “innovation”] Merriam Webster. Retrieved February 9, 2009.</ref>. In its modern usage, a distinction is typically made between an idea, an invention (an idea made manifest), and innovation (ideas applied successfully). <ref>Max Mckeown,  The Truth About Innovation. Pearson / Financial Times. 2008.  ISBN 0273719122 </ref>. Innovation is an important topic in the study of [[economics]], [[business]], [[technology]], [[sociology]], [[policy making]] and [[engineering]].  In each of these fields “innovation” connotes something slightly different.
  
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Those who are directly responsible for application of the innovation are often called pioneers in their field, whether they are individuals or organisations.
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Innovation has been studied in a variety of contexts, and scholars have developed a wide range of approaches to defining and measuring innovation. A consistent theme in discussions of innovation is the understanding that it is the successful ''introduction'' of something ''new'' and ''useful'', for example introducing new methods, techniques, or practices or new or altered products and services.<ref name=fag> Jan Fagerberg, "Innovation: A Guide to the Literature" in Fagerberg, Jan, David C. Mowery and Richard R. Nelson. The Oxford Handbook of Innovations. Oxford University Press.  2004. pp. 1–26. ISBN 0–19–926455–4.</ref> Though innovation is frequently associated with improvement and thought of as being positive and beneficial, the successful introduction of a “new” and “useful” method, practice or product may have negative consequences for an organization or society, such as the disruption of traditional social relationships or the obsolescence of certain labor skills. A “useful” new product may have a negative impact on the environment, or may bring about the depletion of natural resources.  
  
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== Introduction ==
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==Innovation, creativity and invention==
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In the organizational context, innovation may be linked to performance and growth through improvements in efficiency, [[productivity]], [[quality]], [[competitive positioning]], [[market share]], etc. All organizations can innovate, including for example hospitals, universities, and local governments.  
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[[Invention]], the creation of new forms, compositions of matter, or processes, is often confused with innovation. An invention is the first occurrence of an idea for a new product or process, while innovation involves implementing its use in society. <ref name=fag/>The electric light bulb did not become an innovation until Thomas Edison established power plants to furnish electricity to streetlamps and houses so that the light bulbs could be used. In an organization, an idea, a change or an improvement is only an innovation when it is implemented and effectively causes a social or commercial reorganization.
  
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While innovation typically adds value, innovation may also have a negative or destructive effect as new developments clear away or change old organizational forms and practices. Organizations that do not innovate effectively may be destroyed by those that do. Hence innovation typically involves risk. A key challenge in innovation is maintaining a balance between process and product innovations where process innovations tend to involve a [[business model]] which may develop shareholder satisfaction through improved efficiencies while product innovations develop customer support however at the risk of costly [[R&D]] that can erode shareholder return.
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Innovation characteristically involves [[creativity]], but is not synonymous with it. A creative idea or insight is only the beginning of innovation; innovation involves acting on the creative idea to bring about some specific and tangible difference. For example, in a business or organization, innovation does not occur until a creative insight or idea results in new or altered business processes within the organization, or changes in the products and services provided.
  
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== Conceptualizing innovation ==
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==Sociology, history, behavioral sciences==
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Historians, sociologists and anthropologists study the events and circumstances leading up to innovations and the changes they bring about in human society. One of the greatest innovations in human history was the Industrial Revolution, which ended feudalism, led to the establishment of huge urban centers, and put power in the hands of businessmen. The concentration of large numbers of people in cities and towns and the rise of a middle class resulted in innovations in housing, public health, education, and the arts and entertainment. The Industrial Revolution itself was the result of myriads of innovations in technology, social organization, and banking and finance. The establishment of a democratic government in the United States in 1776 was an innovation that had far-reaching consequences for European countries and eventually for the rest of the world.
  
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Innovation has been studied in a variety of contexts, including in relation to technology, commerce, social systems, economic development, and policy construction. There are, therefore, naturally a wide range of approaches to conceptualizing innovation in the scholarly literature. See, e.g., Fagerberg et al. (2004).
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The development of modern forms of transportation, the train, automobile, and airplane, also altered the way in which people live and conduct business. Innovations in weaponry, such as the cannon and musket, and more recently, guided missiles and nuclear bombs, gave the nations who implemented them dominance over other nations.  
  
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Fortunately, however, a consistent theme may be identified: innovation is typically understood as the successful ''introduction'' of something ''new'' and ''useful'', for example introducing new methods, techniques, or practices or new or altered products and services.
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During the last decade of the 20th century and the first decade of the 21st century, technological innovations like the cell phone, internet and wireless technology transformed the way in which people communicate with each other and gain access to information.  Cell phones have made it possible for people in developing countries, who previously did not have access to an efficient telephone system, to communicate freely and easily, facilitating business transactions and social relationships. The internet allows people in countries where governmental control or inadequate economic resources limit access to information, to circumvent those restrictions and disseminate knowledge internationally. Individuals now have immediate access to information about the stock market, their bank accounts, current events, the weather, and consumer products.
  
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{{POV|date=May 2008}}
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==Policy making==
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===Distinguishing from Invention and other concepts===
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Social and economic innovations often occur spontaneously, as human beings respond in a natural way to new circumstances. Governments, legislators, urban planners and administrators are concerned with bringing about deliberate innovation through creating and implementing effective public policies to achieve certain goals. The cost of enforcing a new public policy must be weighed against the expected benefits. A policy change may have unforeseen, and sometimes unwanted, consequences.
  
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"An important distinction is normally made between invention and innovation. Invention is the first occurrence of an idea for a new product or process, while innovation is the first attempt to carry it out into practice" (Fagerberg, 2004: 4)
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Examples of public policies that have brought about positive social innovations are the granting of property rights to women, universal suffrage, welfare and unemployment compensation and mandatory education for children. Examples of  public policy that resulted in harmful innovation are the Cultural Revolution initiated in 1966 by Mao Zedong, which closed universities and suppressed education for several years in China; the collectivization of agriculture in the U.S.S.R. by Joseph Stalin <ref>Alan Bullock, Hitler and Stalin: Parallel Lives. London: HarperCollins, 1991 (hardcover, ISBN 0002154943); New York: Vintage Books, 1993 (paperback, ISBN 0679729941). p. 269</ref> which caused millions to die of starvation during 1931 and 1932; and the efforts of Pol Pot (Saloth Sar) in the 1970s to evacuate all urban dwellers to the countryside and return to an agricultural barter economy, which cost the lives of approximately 26 percent of Cambodia’s population. <ref name = yale>{{cite web|url=http://www.yale.edu/cgp/ |title=The Cambodian Genocide Program |accessdate= Retrieved February 10, 2009|date= 1994-2008 |work= Genocide Studies Program |publisher= [[Yale University]] }}</ref>
  
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It is useful, when conceptualising innovation, to consider whether other words suffice.  [[Invention]] – the creation of new forms, compositions of matter, or processes – is often confused with innovation.  An improvement on an existing form, composition or processes might be an invention, an innovation, both or neither if it is not substantial enough.  It can be difficult to differentiate change from innovation.  According to business literature, an idea, a change or an improvement is only an innovation when it is put to use and effectively causes a social or commercial reorganization.
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== Organizations ==
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In the context of an organization such as a corporation, local government, hospital, university, or non-profit organization, innovation is linked to performance and growth through improvements in efficiency, [[productivity]], [[quality]], and [[competitive positioning]].  A new management procedure, organizational structure, method of operation, communications device or product may be introduced in an effort to make the organization more efficient and productive. Successful innovation requires the definition of goals, knowledge of the materials and processes involved, financial and human resources, and effective management. A certain amount of experimentation is also necessary to adjust the new processes so that they produce the desired result.
  
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Innovation occurs when someone uses an invention or an idea to change how the world works, how people organize themselves, or how they conduct their lives. In this view innovation occurs whether or not the act of innovating succeeds in generating value for its champions. Innovation is distinct from improvement in that it permeates society and can cause reorganization. It is distinct from problem solving and may cause problems. Thus, in this view, innovation occurs whether it has positive or negative results.
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Deliberate innovation involves risk. Organizations that do not innovate effectively may be destroyed by those that do. While innovation typically adds value, it may also have a negative or destructive effect as new developments clear away or change old organizational forms and practices. If the changes undermine employee morale, the new system may be less efficient than the old. Innovation can also be costly. The expense of purchasing and installing new equipment, computers and software, or of re-organizing, hiring and training staff is substantial, and may leave an organization without sufficient resources to continue its operations effectively. Organizations attempt to minimize risk by studying and analyzing innovations carried out by other organizations, by employing experts and consultants to carry out the innovation, and by following a number of formulas and management strategies.
  
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=== Innovation in organizations ===
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The introduction of computers during the second half of the 20th century necessitated innovation in almost every type of organization. The productivity of individual workers was increased, and many clerical jobs were eliminated. Organizations made large investments in technology and created entire departments to maintain and manage computers and information, giving rise to a number of new professions. Paper documents were translated into electronic data. The workforce acquired new skills, and those who could not adapt dropped behind younger workers who were more familiar with technology and changed the dynamics of the workplace. Networks and internet connections allowed frequent and rapid communication within an organization. The centralization of information such as inventory, financial accounts and medical records made new types of analysis and measurement possible.  While organizations benefited in many ways from the new technology, the expense and risk of innovating also increased.
  
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A convenient definition of innovation from an organizational perspective is given by Luecke and Katz (2003), who wrote:
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== Economics and business ==
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The study and understanding of innovation is particularly important in the fields of business and economics because it is believed that innovation directly drives economic growth. The ability to innovate translates into new goods and services and entry into new markets, and results in increased sales. An increase in sales contributes to the prosperity of the workforce and increases its purchasing power, leading to a steady expansion of the economy. 
  
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:''"Innovation . . . is generally understood as the successful introduction of a new thing or method . . . Innovation is the embodiment, combination, or synthesis of knowledge in original, relevant, valued new products, processes, or services.''
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In 1934, the European economist [[Joseph Schumpeter]] (1883 – 1955) defined economic innovation as:
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#The introduction of a new good — that is one with which consumers are not yet familiar — or of a new quality of a good.  
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#The introduction of a new method of production, which need by no means be founded upon a discovery scientifically new, and can also exist in a new way of handling a commodity commercially.
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#The opening of a new market, that is a market into which the particular branch of manufacture of the country in question has not previously entered, whether or not this market has existed before.
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#The conquest of a new source of supply of raw materials or half-manufactured goods, again irrespective of whether this source already exists or whether it has first to be created. 
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#The carrying out of the new organization of any industry, like the creation of a monopoly position (for example through trustification) or the breaking up of a monopoly position'':.<ref>{{cite book
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| last = Schumpeter
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| first = Joseph
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| authorlink = Joseph Schumpete
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| year = 1934
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| title = The Theory of Economic Development
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| publisher = Harvard University Press, Boston
  
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Innovation typically involves [[creativity]], but is not identical to it: innovation involves acting on the creative ideas to make some specific and tangible difference in the domain in which the innovation occurs. For example, Amabile et al. (1996) propose: 
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}}</ref>
  
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:''"All innovation begins with creative ideas . . . We define innovation as the successful implementation of creative ideas within an organization. In this view, creativity by individuals and teams is a starting point for innovation; the first is necessary but not sufficient condition for the second".
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Businesses recognize that innovation is essential for their survival, and seek to create a business model that fosters innovation while controlling costs<ref> Davila, Tony; Marc J. Epstein and Robert Shelton Making Innovation Work: How to Manage It, Measure It, and Profit from It''. Upper Saddle River: Wharton School Publishing. 2006. ISBN 0–13–149786–3 p. 6</ref>. Managers use mathematical formulas, behavioral studies and forecasting models to create strategies for implementing innovation. Business organizations spend between ½ of a percent (for organizations with a low rate of change) to more than 20 percent of their annual revenue on making changes to their established products, processes and services. The average investment across all types of organizations is four percent, spread across functions including marketing, product design, information systems, manufacturing systems and quality assurance.  
  
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For innovation to occur, something more than the generation of a creative idea or insight is required: the insight must be put into action to make a genuine difference, resulting for example in new or altered business processes within the organization, or changes in the products and services provided.
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Much of the innovation carried out by business organizations is not directed towards development of new products, but towards other goals such as reduction of materials and labor costs, improvement of quality, expansion of existing product lines, creation of new markets, reduction of energy consumption and lessening of environmental impact.  
  
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A further characterization of innovation is as an organizational or management process. For example, Davila et al. (2006), write:
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Many "breakthrough innovations" are the result of formal [[research and development]], but innovations may be developed by less formal on-the-job modifications of practice, or through the exchange and combination of professional experience.
  
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:''"Innovation, like many business functions, is a management process that requires specific tools, rules, and discipline."''
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The traditionally recognized source of innovation is ''manufacturer innovation,'' where a person or business innovates in order to sell the innovation. Another important source of innovation is ''end-user innovation,'' in which a person or company develops an innovation for their own use because existing products do not meet their needs. <ref>{{cite book
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| last = von Hippel
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| first = Eric
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| authorlink = Eric von Hippel
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| year = 1988
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| title = [http://web.mit.edu/evhippel/www/books/sources/SofI.pdf The Sources of Innovation] Retrieved February 10, 2009
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| publisher = Oxford University Press
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| id = ISBN 0–19–509422–0
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}}</ref> User innovators may become [[entrepreneur]]s selling their product, or more commonly, trade their innovation in exchange for other innovations or services. In the case of computer software, they may choose to freely share their innovations, using methods like [[open source]]. In such [[Networks of Innovation|networks of innovation]] the creativity of the users or communities of users can further develop technologies and their use.
  
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From this point of view the   emphasis is moved from the introduction of specific novel and useful ideas to the general organizational processes and procedures for generating, considering, and acting on such insights leading to significant organizational improvements in terms of improved or new business products, services, or internal processes.
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Analysts debate whether innovation is mainly [[supply-pushed]] (based on new technological possibilities) or [[demand-led]] (based on social needs and market requirements).  They also continue to discuss what exactly drives innovation in organizations and economies. Recent studies have revealed that innovation does not just happen within the industrial supply-side, or as a result of the articulation of user demand, but through a complex set of processes that links input from not only developers and users, but a wide variety of intermediary organizations such as consultancies and standards associations. Examination of social networks suggests that much successful innovation occurs at the boundaries of organizations and industries where the problems and needs of users, and the potential of technologies are together in a creative process.  
  
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Through these varieties of viewpoints, creativity is typically seen as the basis for innovation, and innovation as the successful implementation of creative ideas within an organization (c.f. Amabile et al. 1996 p.1155). From this point of view, creativity may be displayed by individuals, but innovation occurs in the organizational context only.
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== Diffusion of innovations ==
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[[Image:InnovationLifeCycle.jpg|300px|right]]
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It should be noted, however, that the term 'innovation' is used by many authors rather interchangeably with the term 'creativity' when discussing individual and organizational creative activity. As Davila et al. (2006) comment,
 
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:''"Often, in common parlance, the words ''creativity'' and ''innovation'' are used interchangeably. They shouldn't be, because while creativity implies coming up with ideas, it's the "bringing ideas to life" . . . that makes innovation the distinct undertaking it is."''
 
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The distinctions between creativity and innovation discussed above are by no means fixed or universal in the innovation literature. They are however observed by a considerable number of scholars in innovation studies.
 
  
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=== Innovation as a behavior ===
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Once innovation occurs, innovations may be spread from the innovator to other individuals and groups. In 1962, [[Everett Rogers]] proposed that the life cycle of innovations can be described using the ‘s-curve’ or [[Diffusion of innovations|diffusion curve]]. The s-curve maps growth of revenue or productivity against time. In the early stage of a particular innovation, growth is relatively slow as the new product establishes itself. At some point consumer demand increases and product sales expand more rapidly. New incremental innovations or changes to the product allow growth to continue. Towards the end of its life cycle growth slows and may even begin to decline. In the later stages, no amount of new investment in that product will yield a normal rate of return.  
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Some in depth work on innovation in organisations, teams and individuals has been carried out by J. L. Byrd<ref>The Innovation Equation</ref>, PhD who is co-author of "The Innovation Equation."  Dr Jacqueline Byrd is the brain behind the Creatrix Inventory which can be used to look at innovation and what is behind it. The Innovation Equation she developed is:
 
  
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'''Innovation = Creativity * Risk Taking'''
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Innovative companies will typically be constantly working on new innovations that will eventually replace older ones. Successive s-curves will come along to replace older ones and continue to drive growth upwards. In the figure above the first curve shows a current technology. The second shows an [[emerging technologies|emerging technology]] that currently yields lower growth but will eventually overtake the  current technology and lead to even greater levels of growth. The length of life will depend on many factors.
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<ref>Rogers, Everett M. (2003).''Diffusion of Innovations'', 5th ed.. New York, NY: Free Press.</ref> 
  
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Using this inventory it is possible to plot on axis where individuals fit on their Risk Taking and Creativity.
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[[image:Bass diffusion model.gif|right]]
  
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=== Economic conceptions of innovation ===
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The ''Bass diffusion model'' developed by [[Frank Bass]] in 1969 illustrates the process by which a new innovative product is adopted  by new users, then is overtaken by products imitating the innovation. The model is widely used in [[forecasting]], especially [[product forecasting]] and [[technology forecasting]]. 
  
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[[Joseph Schumpeter]] defined economic innovation in The Theory of Economic Development, 1934, Harvard University Press, Boston.<ref>{{cite book
 
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| last = Schumpeter
 
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| first = Joseph
 
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| authorlink = Joseph Schumpete
 
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| year = 1934
 
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| title = The Theory of Economic Development
 
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| publisher = Harvard University Press, Boston
 
  
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}}</ref>
 
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#The introduction of a new good — that is one with which consumers are not yet familiar — or of a new quality of a good.
 
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#The introduction of a new method of production, which need by no means be founded upon a discovery scientifically new, and can also exist in a new way of handling a commodity commercially. 
 
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#The opening of a new market, that is a market into which the particular branch of manufacture of the country in question has not previously entered, whether or not this market has existed before.
 
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#The conquest of a new source of supply of raw materials or half-manufactured goods, again irrespective of whether this source already exists or whether it has first to be created. 
 
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#The carrying out of the new organization of any industry, like the creation of a monopoly position (for example through trustification) or the breaking up of a monopoly position''
 
  
 
Schumpeter's focus on innovation is reflected in Neo-Schumpeterian economics, developed by such scholars as [[Christopher Freeman]]<ref>{{cite book
 
Schumpeter's focus on innovation is reflected in Neo-Schumpeterian economics, developed by such scholars as [[Christopher Freeman]]<ref>{{cite book
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=== [[Transaction cost]] and [[network theory]] perspectives ===
 
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According to Regis Cabral (1998, 2003):
 
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:''"Innovation is a new element introduced in the network which changes, even if momentarily, the costs of transactions between at least two actors, elements or nodes, in the network."
 
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== Innovation and market outcome ==
 
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Market outcome from innovation can be studied from different lenses.
 
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The industrial organizational approach of market characterization according to the degree of competitive pressure and the consequent modelling of firm behavior often using sophisticated game theoretic tools, while permitting mathematical modelling, has shifted the ground away from an intuitive understanding of markets. The earlier visual framework in economics, of market demand and supply along price and quantity dimensions, has given way to powerful mathematical models which though intellectually satisfying has led policy makers and managers groping for more intuitive and less theoretical analyses to which they can relate to at a practical level. Non quantifiable variables find little place in these models, and when they do, mathematical gymnastics (such as the use of different demand elasticities for differentiated products) embrace many of these qualitative variables, but in an intuitively unsatisfactory way.
 
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In the management (strategy) literature on the other hand, there is a vast array of relatively simple and intuitive models for both managers and consultants to choose from. Most of these models provide insights to the manager which help in crafting a strategic plan consistent with the desired aims. Indeed most strategy models are generally simple, wherein lie their virtue. In the process however, these models often fail to offer insights into situations beyond that for which they are designed, often due to the adoption of frameworks seldom analytical, seldom rigorous. The situational analyses of these models often tend to be descriptive and seldom robust and rarely present behavioral relationship between variables under study.
 
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From an academic point of view, there is often a divorce between industrial organisation theory and strategic management models. While many economists view management models as being too simplistic, strategic management consultants perceive academic economists as being too theoretical, and the analytical tools that they devise as too complex for managers to understand.
 
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Innovation literature while rich in typologies and descriptions of innovation dynamics is mostly technology focused. Most research on innovation has been devoted to the process (technological) of innovation, or has otherwise taken a how to (innovate) approach. The integrated innovation model of  [[Soumodip Sarkar]] goes some way to providing the academic, the manager and the consultant an intuitive understanding of the innovation – market linkages in a simple yet rigorous framework in his book, ''Innovation, Market Archetypes and Outcome- An Integrated Framework''.<ref>{{cite book
 
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| last = Sarkar
 
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| first = Soumodip
 
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| authorlink = Soumodip Sarkar
 
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| year = 2007
 
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| title = Innovation, Market Archetypes and Outcome- An Integrated Framework
 
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| publisher = Springer Verlag
 
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| id = ISBN 379081945X
 
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}}</ref>
 
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The integrated model presents a new framework for understanding firm and market dynamics, as it relates to innovation. The model is enriched by the different strands of literature – industrial organization, management and innovation. The integrated approach that allows the academic, the management consultant and the manager alike to understand where a product (or a single product firm) is located in an integrated innovation space, why it is so located and which then provides valuable clues as to what to do while designing strategy. The integration of the important determinant variables in one visual framework with a robust and an internally consistent theoretical basis is an important step towards devising comprehensive firm strategy. The integrated framework provides vital clues towards framing a what to guide for managers and consultants. Furthermore, the model permits metrics and consequently diagnostics of both the firm and the sector and this set of assessment tools provide a valuable guide for devising strategy.
 
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== Sources of innovation ==
 
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There are several sources of innovation. In the [[linear model]] the traditionally recognized source is ''manufacturer innovation''. This is where an agent (person or business) innovates in order to sell the innovation. Another source of innovation, only now becoming widely recognized, is ''end-user innovation''. This is where an agent (person or company) develops an innovation for their own (personal or in-house) use because existing products do not meet their needs. [[Eric von Hippel]] has identified end-user innovation as, by far, the most important and critical in his classic book on the subject, ''Sources of Innovation''.<ref>{{cite book
 
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| last = von Hippel
 
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| first = Eric
 
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| authorlink = Eric von Hippel
 
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| year = 1988
 
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| title = [http://web.mit.edu/evhippel/www/books/sources/SofI.pdf The Sources of Innovation]
 
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| publisher = Oxford University Press
 
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| id = ISBN 0–19–509422–0
 
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}}</ref>
 
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Innovation by businesses is achieved in many ways, with much attention now given to formal [[research and development]] for "breakthrough innovations." But innovations may be developed by less formal on-the-job modifications of practice, through exchange and combination of professional experience and by many other routes.  The more radical and revolutionary innovations tend to emerge from R&D, while more incremental innovations may emerge from practice – but there are many exceptions to each of these trends.
 
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Regarding [[user innovation]], rarely user innovators may become [[entrepreneur]]s, selling their product, or more often they may choose to trade their innovation in exchange for other innovations. Nowadays, they may also choose to freely reveal their innovations, using methods like [[open source]]. In such [[Networks of Innovation|networks of innovation]] the creativity of the users or communities of users can further develop technologies and their use.
 
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Whether innovation is mainly [[supply-pushed]] (based on new technological possibilities) or [[demand-led]] (based on social needs and market requirements) has been a hotly debated topic. Similarly, what exactly drives innovation in organizations and economies remains an open question.
 
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More recent theoretical work moves beyond this simple dualistic problem, and through empirical work shows that innovation does not just happen within the industrial supply-side, or as a result of the articulation of user demand, but through a complex set of processes that links many different players together – not only developers and users, but a wide variety of intermediary organisations such as consultancies, standards bodies etc. Work on social networks suggests that much of the most successful innovation occurs at the boundaries of organisations and industries where the problems and needs of users, and the potential of technologies can be linked together in a creative process that challenges both.
 
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== Value of experimentation in innovation ==
 
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When an innovative idea requires a new business model, or radically redesigns the delivery of value to focus on the customer, a real world experimentation approach increases the chances of market success. New business models and customer experiences can’t be tested through traditional market research methods. Pilot programs for new innovations set the path in stone too early thus increasing the costs of failure.
 
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Stefan Thomke of Harvard Business School has written a definitive book on the importance of experimentation. Experimentation Matters argues that every company’s ability to innovate depends on a series of experiments [successful or not], that help create new products and services or improve old ones. That period between the earliest point in the design cycle and the final release should be filled with experimentation, failure, analysis, and yet another round of experimentation. “[[Lather, rinse, repeat]],” Thomke says. Unfortunately, uncertainty often causes the most able innovators to bypass the experimental stage.
 
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In his book, Thomke outlines six principles companies can follow to unlock their innovative potential.
 
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# Anticipate and Exploit Early Information Through ‘Front-Loaded’ Innovation Processes
 
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# Experiment Frequently but Do Not Overload Your Organization.
 
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# Integrate New and Traditional Technologies to Unlock Performance.
 
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# Organize for Rapid Experimentation.
 
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# Fail Early and Often but Avoid ‘Mistakes’.
 
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# Manage Projects as Experiments.<ref>Thomke, Stefan H. (2003) ''Experimentation Matters: Unlocking the Potential of New Technologies for Innovation.'' Harvard Business School Press. ISBN 1578517508.  [http://books.google.com/books?id=nM-5IWBGhoEC&pg=PA163&dq=Anticipate+and+Exploit+Early+Information+Through+%E2%80%98Front-Loaded%E2%80%99+Innovation+Processes&sig=F6hTllVtx3j3kkX_tOoWBF8Br5Q#PPA163,M1]</ref>
 
−
 
−
Thomke further explores what would happen if the principles outlined above were used beyond the confines of the individual organization.  For instance, in the state of Rhode Island, innovators are collaboratively leveraging the state's compact geography, economic and demographic diversity and close-knit networks to quickly and cost-effectively test new business models through a real-world experimentation lab. {{Fact|date=October 2007}}
 
−
 
−
== Diffusion of innovations ==
 
−
[[Image:InnovationLifeCycle.jpg|300px|right]]
 
−
{{main|diffusion of innovations}}
 
−
Once innovation occurs, innovations may be spread from the innovator to other individuals and groups. This process has been  proposed that the life cycle of innovations can be described using the ‘s-curve’ or [[Diffusion of innovations|diffusion curve]]. The s-curve maps growth of revenue or productivity against time. In the early stage of a particular innovation, growth is relatively slow as the new product establishes itself. At some point customers begin to demand and the product growth increases more rapidly. New incremental innovations or changes to the product allow growth to continue. Towards the end of its life cycle growth slows and may even begin to decline. In the later stages, no amount of new investment in that product will yield a normal rate of return.
 
−
 
−
The s-curve is derived from half of a normal distribution curve.  There is an assumption that new products are likely to have "product Life". i.e. a start-up phase, a rapid increase in revenue and eventual decline. In fact the great majority of innovations never get off the bottom of the curve, and never produce normal returns.
 
−
 
−
Innovative companies will typically be working on new innovations that will eventually replace older ones. Successive s-curves will come along to replace older ones and continue to drive growth upwards. In the figure above the first curve shows a current technology. The second shows an [[emerging technologies|emerging technology]] that current yields lower growth but will eventually overtake current technology and lead to even greater levels of growth. The length of life will depend on many factors.
 
−
 
−
== Goals of innovation ==
 
−
 
−
Programs of organizational innovation are typically tightly linked to organizational goals and objectives, to the business plan, and to market competitive positioning.
 
−
 
−
For example, one driver for innovation programs in corporations is to achieve growth objectives. As Davila et al. (2006) note,
 
−
 
−
:"Companies cannot grow through cost reduction and reengineering alone . . . Innovation is the key element in providing aggressive top-line growth, and for increasing bottom-line results" (p.6)
 
−
 
−
In general, business organisations spend a significant amount of their turnover on innovation i.e. making changes to their established products, processes and services. The amount of investment can vary from as low as a half a percent of turnover for organisations with a low rate of change to anything over twenty percent of turnover for organisations with a high rate of change.
 
−
 
−
The average investment across all types of organizations is four percent. For an organisation with a turnover of say one billion currency units, this represents an investment of forty million units. This budget will typically be spread across various functions including marketing, product design, information systems, manufacturing systems and quality assurance.
 
−
 
−
The investment may vary by industry and by market positioning.
 
−
 
−
One survey {{Fact|date=December 2008}} across a large number of manufacturing and services organisations found, ranked in decreasing order of popularity, that systematic programs of organizational innovation are most frequently driven by:
 
−
 
−
#Improved quality
 
−
#Creation of new markets
 
−
#Extension of the product range
 
−
#Reduced labour costs
 
−
#Improved production processes
 
−
#Reduced materials
 
−
#Reduced environmental damage
 
−
#Replacement of products/services
 
−
#Reduced energy consumption
 
−
#Conformance to regulations
 
−
 
−
These goals vary between improvements to products, processes and services and dispel a popular myth that innovation deals mainly with new product development. Most of the goals could apply to any organisation be it a manufacturing facility, marketing firm, hospital or local government.
 
  
 
== Failure of innovation ==
 
== Failure of innovation ==
  
−
Research findings vary, ranging from fifty to ninety percent of innovation projects judged to have made little or no contribution to organizational goals. One survey regarding product innovation quotes that out of three thousand ideas for new products, only one becomes a success in the marketplace. {{Fact|date=October 2007}} Failure is an inevitable part of the innovation process, and most successful organisations factor in an appropriate level of risk. Perhaps it is because all organisations experience failure that many choose not to monitor the level of failure very closely. The impact of failure goes beyond the simple loss of investment. Failure can also lead to loss of morale among employees, an increase in cynicism and even higher resistance to change in the future.
+
Success in implementing an innovation does not guarantee a beneficial outcome. Research shows that from fifty to ninety percent of innovation projects are judged to have made little or no contribution to the goals of the innovating organization. Innovations that fail are often potentially ‘good’ ideas but do not achieve desired results because of budgetary constraints, lack of skills, poor leadership, lack of knowledge, lack of motivation, or poor fit with current goals. The impact of failure goes beyond the simple loss of investment. Failure can also lead to loss of morale among employees, an increase in cynicism and even higher resistance to change in the future. Most companies allow for the possibility of failure when planning an innovation, and include processes for detecting problems before they consume too many resources and threaten the organization’s future.
−
 
 
−
Innovations that fail are often potentially ‘good’ ideas but have been rejected or ‘shelved’ due to budgetary constraints, lack of skills or poor fit with current goals.  Failures should be identified and screened out as early in the process as possible.  Early screening avoids unsuitable ideas devouring scarce resources that are needed to progress more beneficial ones.  Organizations can learn how to avoid failure when it is openly discussed and debated. The lessons learned from failure often reside longer in the organisational consciousness than lessons learned from success.  While learning is important, high failure rates throughout the innovation process are wasteful and a threat to the organisation's future.
 
−
 
 
−
The causes of failure have been widely researched and can vary considerably. Some causes will be external to the organisation and outside its influence of control. Others will be internal and ultimately within the control of the organisation. Internal causes of failure can be divided into causes associated with the cultural infrastructure and causes associated with the innovation process itself. Failure in the cultural infrastructure varies between organizations but the following are common across all organisations at some stage in their life cycle (O'Sullivan, 2002):
 
−
#Poor Leadership
 
−
#Poor Organization
 
−
#Poor Communication
 
−
#Poor Empowerment
 
−
#Poor Knowledge Management
 
−
 
 
−
Common causes of failure within the innovation process in most organisations can be distilled into five types:
 
−
#Poor goal definition
 
−
#Poor alignment of actions to goals
 
−
#Poor participation in teams
 
−
#Poor monitoring of results
 
−
#Poor communication and access to information
 
−
 
 
−
Effective goal definition requires that organisations state explicitly what their goals are in terms understandable to everyone involved in the innovation process. This often involves stating goals in a number of ways. Effective alignment of actions to goals should link explicit actions such as ideas and projects to specific goals. It also implies effective management of action portfolios. Participation in teams refers to the behaviour of individuals in and of teams, and each individual should have an explicitly allocated responsibility regarding their role in goals and actions and the payment and rewards systems that link them to goal attainment. Finally, effective monitoring of results requires the monitoring of all goals, actions and teams involved in the innovation process.
 
−
 
 
−
Innovation can fail if seen as an organisational process whose success stems from a mechanistic approach i.e. 'pull lever obtain result'. While 'driving' change has an emphasis on control, enforcement and structure it is only a partial truth in achieving innovation. Organisational gatekeepers frame the organisational environment that "Enables" innovation; however innovation is "Enacted" – recognised, developed, applied and adopted – through individuals.
 
−
 
 
−
Individuals are the 'atom' of the organisation close to the minutiae of daily activities. Within individuals gritty appreciation of the small detail combines with a sense of desired organisational objectives to deliver (and innovate for) a product/service offer.
 
−
 
 
−
From this perspective innovation succeeds from strategic structures that engage the individual to the organisation's benefit. Innovation pivots on intrinsically motivated individuals, within a supportive culture, informed by a broad sense of the future.
 
  
−
Innovation, implies change, and can be counter to an organisation's orthodoxy. Space for fair hearing of innovative ideas is required to balance the potential autoimmune exclusion that quells an infant innovative culture.
+
Early detection of problems and adjustment of the innovation process contribute to the success of the final outcome. The lessons learned from failure often reside longer in the organizational consciousness than lessons learned from success.
  
 
== Measures of innovation ==  
 
== Measures of innovation ==  
−
There are two fundamentally different types of measures for innovation: the organisational level and the political level.  
+
Attempts to measure innovation take place on two levels: the organizational level and the political level. Within an organization, innovation can be evaluated by conducting surveys and workshops, consulting outside experts, or using internal benchmarks. There is no measure of organizational innovation. Corporate measurements generally utilize scorecards which cover several aspects of innovation such as financial data, innovation process efficiency, employees' contribution and motivation, and benefits for customers. The elements selected for these evaluations vary widely from company to company and may include new product revenue, amount spent on research and development, time to market, customer and employee perception and satisfaction, number of patents, and additional sales resulting from past innovations.  
−
The measure of innovation at the organisational level relates to individuals, team-level assessments, private companies from the smallest to the largest. Measure of innovation for organisations can be conducted by surveys, workshops, consultants or internal benchmarking. There is today no established general way to measure organisational innovation. Corporate measurements are generally structured around balanced scorecards which cover several aspects of innovation such as business measures related to finances, innovation process efficiency, employees' contribution and motivation, as well benefits for customers. Measured values will vary widely between businesses, covering for example new product revenue, spending in R&D, time to market, customer and employee perception & satisfaction, number of patents, additional sales resulting from past innovations.
 
−
For the political level, measures of innovation are more focussing on a country or region competitive advantage through innovation. In this context, organizational capabilities can be evaluated through various evaluation frameworks e.g. '''efqm''' (European foundation for quality management). The OECD Oslo Manual from 1995 suggests standard guidelines on measuring technological product and process innovation. Some people consider the [[Oslo Manual]] complementary to the [[Frascati Manual]] from 1963. The new Oslo manual from 2005 takes a wider perspective to innovation, and includes marketing and organizational innovation. Other ways of measuring innovation have traditionally been expenditure, for example, investment in R&D (Research and Development) as percentage of GNP (Gross National Product). Whether this is a good measurement of Innovation has been widely discussed and the Oslo Manual has incorporated some of the critique against earlier methods of measuring. This being said, the traditional methods of measuring still inform many policy decisions. The EU [[Lisbon Strategy]] has set as a goal that their average expenditure on R&D should be 3 % of GNP.
 
  
−
The Oslo Manual is focused on North America, Europe, and other rich economies. In 2001 for Latin America and the Caribbean countries it was created the [[Bogota Manual]]
+
On a political level, measures of innovation are used to compare one country or region with another.  The OECD (Organisation for Economic Co-operation and Development ) Oslo Manual of 1995 suggested standard guidelines for measuring technological product and process innovation. The new Oslo Manual of 2005 added marketing and organizational innovation. The [[Bogota Manual]] was created in 2001 for Latin America and the Caribbean countries. A traditional indicator used to measure innovation is expenditure, for example, investment in R&D (Research and Development) as a percentage of GNP (Gross National Product).
  
−
Many scholars claim that there is a great bias towards the "science and technology mode" (S&T-mode or STI-mode), while the "learning by doing, using and interacting mode" (DUI-mode) is widely ignored. For an example, that means you can have the better high tech or software, but there are also crucial learning tasks important for innovation. But these measurements and research are rarely done.
+
Economists Christopher Freeman''' (born 1921) and Bengt-Åke Lundvall developed the National Innovation System (NIS) to explain the flow of technology and information which is key to the innovative process on the national level. According to [[innovation system|innovation system theory]], [[innovation]] and technology development are results of a complex set of relationships among people, enterprises, universities and government research institutes.
  
−
===2008-2009 Global Innovation Index===
+
The 2008-2009 Global Innovation Index created by Soumitra Dutta, a professor at French business school INSEAD, along with New Delhi based non-profit organization The Confederation of Indian Industry <ref>[http://www.fastcompany.com/blog/saabira-chaudhuri/itinerant-mind/united-states-worlds-number-one-innovator United States The World's Number One Innovator?] Saabira Chaudhuri, Fast Company (January 7, 2009) Retrieved February 9, 2009.</ref> ranks nations based on indices such as the number of internet users in a nation, the ease of doing business and the stability of banks. Every factor is then categorized as either an input or an output. Inputs indicate how conducive countries are to fostering innovation, and include institutions and policies, human capacity, infrastructure, technological sophistication, business markets and capital. The outputs indicate how effectively countries translate innovation into benefits such as knowledge, competitiveness and wealth. The top ten countries are listed below:
−
 
 
−
In January 2009, the 2008-2009 Global Innovation Index was published.<ref>http://www.fastcompany.com/blog/saabira-chaudhuri/itinerant-mind/united-states-worlds-number-one-innovator</ref> It was created by Soumitra Dutta, a professor at French business school INSEAD, along with New Delhi based non-profit organization The Confederation of Indian Industry. The ranking is based on indices such as the number of internet users in a nation, the ease of doing business and the stability of banks (that score alone makes surprising that the U.S. tops the list). Every factor is then categorized as either an input or an output, with inputs indicating how conducive countries are to stimulating innovation (these include institutions and policies, human capacity, infrastructure, technological sophistication, business markets and capital). The outputs indicate how effectively countries translate innovation into benefits - like knowledge, competitiveness and wealth. The top ten countries are listed below:
 
  
 
{| class="sortable wikitable"
 
{| class="sortable wikitable"
Line 274: Line 151:
 
| 10 || {{flag|Netherlands}} || [[Europe]]
 
| 10 || {{flag|Netherlands}} || [[Europe]]
 
|}
 
|}
−
 
−
== Public awareness ==
 
−
Public awareness of innovation is an important part of the innovation process. This is further discussed in the emerging fields of [[innovation journalism]] and [[innovation communication]].
 
  
 
== See also ==
 
== See also ==
Line 282: Line 156:
 
* [[Creative problem solving]]
 
* [[Creative problem solving]]
 
* [[Theories of technology]]
 
* [[Theories of technology]]
−
* [[Wikt:deployment|Deployment]]
 
 
* [[Diffusion (anthropology)]]
 
* [[Diffusion (anthropology)]]
 
* [[Ecoinnovation]]
 
* [[Ecoinnovation]]
 
* [[Emerging technologies]]
 
* [[Emerging technologies]]
−
* [[List of emerging technologies]]
 
 
* [[Hype cycle]]
 
* [[Hype cycle]]
 
* [[Individual capital]]
 
* [[Individual capital]]
−
* [[Induced innovation]]
 
 
* [[Information revolution]]
 
* [[Information revolution]]
 
* [[Ingenuity]]
 
* [[Ingenuity]]
 
* [[Invention]]
 
* [[Invention]]
−
* [[Innovitation]]- 2% for 100%
 
 
* [[Innovation Economics]]
 
* [[Innovation Economics]]
 
* [[Open Innovation]]
 
* [[Open Innovation]]
Line 300: Line 170:
 
* [[Research]]
 
* [[Research]]
 
* [[Timeline of invention]]
 
* [[Timeline of invention]]
−
* [[Toolkits for User Innovation]]
 
 
* [[User innovation]]
 
* [[User innovation]]
 
* [[Value network]]
 
* [[Value network]]
 +
==Notes==
 +
<references />
  
 
== References ==
 
== References ==
−
*{{cite journal
+
*Barras, R. "Towards a theory of innovation in services". Research Policy 15: 161–73. 1984.
−
| last = Barras
+
*Cabral, Regis. "Development, Science and". in Heilbron, J.. The Oxford Companion to The History of Modern Science. New York: Oxford University Press. 2003. pp. 205–207.
−
| first = R.
+
*Chakravorti, Bhaskar. The Slow Pace of Fast Change: Bringing Innovations to Market in a Connected World. Boston, MA: Harvard Business School Press. 2003.
−
| year = 1984
+
*Byrd, Jacqueline. The Innovation Equation - Building Creativity & Risk Taking in your Organization. San Francisco, CA: Jossey-Bass/Pfeiffer - Aprint. 2003. ISBN 0-7879-6250-3.
−
| title = Towards a theory of innovation in services
+
*Chesbrough, Henry William. Open Innovation: The New Imperative for Creating and Profiting from Technology. Boston, MA: Harvard Business School Press. 2003. ISBN 1–57851–837–7.
−
| journal = Research Policy
+
*Christensen, Clayton M. . The Innovator's Dilemma. Boston, MA: Harvard Business School Press. 1997. ISBN 0–06–052199–6.
−
| volume = 15
+
*Davila, Tony; Marc J. Epstein and Robert Shelton. Making Innovation Work: How to Manage It, Measure It, and Profit from It''. Upper Saddle River: Wharton School Publishing. 2006. ISBN 0–13–149786–3.
−
| pages = 161–73
+
*Ettlie, John. Managing Innovation, Second Edition. Butterworth-Heineman, an imprint of Elsevier. 2006. ISBN 0–7506–7895-X.
−
}}
+
*Fagerberg, Jan. "Innovation: A Guide to the Literature". in Fagerberg, Jan, David C. Mowery and Richard R. Nelson. The Oxford Handbook of Innovations. Oxford University Press. 2004. pp. 1–26. ISBN 0–19–926455–4.
−
*{{cite book
+
*Freeman, Chris. The Economics of Industrial Innovation. Frances Pinter, London.  1982.
−
| last = Cabral
+
*Hesselbein, Frances, Marshall Goldsmith, and Iain Sommerville, ed (2002). Leading for Innovation: And organizing for results. Jossey-Bass. ISBN 0–7879–5359–8.
−
| first = Regis
+
*Hitcher, Waldo. Innovation Paradigm Replaced. Wiley. 2006.
−
| year = 2003
+
*Luecke, Richard; Ralph Katz. Managing Creativity and Innovation. Boston, MA: Harvard Business School Press. 2003. ISBN 1–59139–112–1.
−
| title = [http://www.oxfordreference.com/pages/Subjects_and_titles__t132.html The Oxford Companion to The History of Modern Science]
+
*Mckeown, Max. The Truth About Innovation. Pearson / Financial Times. 2008. ISBN 0273719122.
−
| editor = Heilbron, J.
+
*Miles, Ian. "Innovation in Services". in Fagerberg, Jan, David C. Mowery and Richard R. Nelson. The Oxford Handbook of Innovations. Oxford University Press. 2004. pp. 433–458. ISBN 0–19–926455–4.
−
| publisher = Oxford University Press
+
*OECD The Measurement of Scientific and Technological Activities. Proposed Guidelines for Collecting and Interpreting Technological Innovation Data. Oslo Manual. 2nd edition, DSTI, OECD / European Commission Eurostat, Paris 31 Dec 1995.
−
| location = New York
+
*Rogers, Everett M. Diffusion of Innovation. New York, NY: Free Press. 1962.
−
| pages = 205–207
+
*Rosenberg, Nathan Perspectives on Technology. Cambridge, London and N.Y.: Cambridge University Press. 1975.
−
| chapter = Development, Science and
+
*Schumpeter, Joseph. The Theory of Economic Development. Cambridge, MA: Harvard University Press. 1934.
−
}}
+
*Scotchmer, Suzanne. Innovation and Incentives. Cambridge, MA: MIT Press. 2004.
−
*{{cite journal
+
*Stein, Morris. Stimulating creativity. New York: Academic Press. 1974.
−
| last = Cabral
+
*von Hippel, Eric . Democratizing Innovation. 2005. MIT Press. ISBN 0–262–22074–1.
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| first = Regis
 
−
| year = 1998
 
−
| title = Refining the Cabral-Dahab Science Park Management Paradigm
 
−
| journal = Int. J. Technology Management
 
−
| volume = 16
 
−
| issue = 8
 
−
| pages = 813–818
 
−
| doi =10.1504/IJTM.1998.002694
 
−
}}.
 
−
*{{cite book
 
−
| last = Chakravorti
 
−
| first = Bhaskar
 
−
| year = 2003
 
−
| title = The Slow Pace of Fast Change: Bringing Innovations to Market in a Connected World
 
−
| publisher = Harvard Business School Press
 
−
| location = Boston, MA
 
−
}}
 
−
*{{cite book
 
−
| last = Byrd
 
−
| first = jacqueline
 
−
| year = 2003
 
−
| title = The Innovation Equation - Building Creativity & Risk Taking in your Organization
 
−
| publisher = Jossey-Bass/Pfeiffer - Aprint
 
−
| location = San Francisco, CA
 
−
| isbn = 0-7879-6250-3
 
−
}}
 
−
 
 
−
*{{cite book
 
−
| last = Chesbrough
 
−
| first = Henry William
 
−
| year = 2003
 
−
| title = Open Innovation: The New Imperative for Creating and Profiting from Technology
 
−
| publisher = Harvard Business School Press.
 
−
| location = Boston, MA
 
−
| id = ISBN 1–57851–837–7
 
−
}}
 
−
*{{cite book
 
−
| last = Christensen
 
−
| first = Clayton M.
 
−
| authorlink = Clayton M. Christensen
 
−
| year = 1997
 
−
| title = The Innovator's Dilemma
 
−
| publisher = Harvard Business School Press
 
−
| location = Boston, MA
 
−
| id = ISBN 0–06–052199–6
 
−
}}
 
−
*{{cite book
 
−
| last = Davila
 
−
| first = Tony
 
−
| coauthors = Marc J. Epstein and Robert Shelton
 
−
| year = 2006
 
−
| title = Making Innovation Work: How to Manage It, Measure It, and Profit from It''
 
−
| publisher = Wharton School Publishing
 
−
| location = Upper Saddle River
 
−
| id = ISBN 0–13–149786–3
 
−
}}
 
−
*{{cite journal
 
−
| last = Dosi
 
−
| first = Giovanni
 
−
| authorlink = Dosi
 
−
| year = 1982
 
−
| title = Technological paradigms and technological trajectories
 
−
| journal = Research Policy
 
−
| volume = 11
 
−
| issue = 3
 
−
| pages = 147–162
 
−
}}
 
−
*{{cite book
 
−
| last = Ettlie
 
−
| first = John
 
−
| authorlink = John E. Ettlie
 
−
| year = 2006
 
−
| title = Managing Innovation, Second Edition
 
−
| publisher = Butterworth-Heineman, an imprint of Elsevier
 
−
| id = ISBN 0–7506–7895-X
 
−
}}
 
−
*{{cite journal
 
−
| last = Evangelista
 
−
| first = Rinaldo
 
−
| year = 2000
 
−
| title = Sectoral patterns of technological change in services, economics of innovation
 
−
| journal = Economics of Innovation and New Technology
 
−
| volume = 9
 
−
| pages = 183–221
 
−
| doi = 10.1080/10438590000000008
 
−
}}
 
−
*{{cite book
 
−
| last = Fagerberg
 
−
| first = Jan
 
−
| editor = Fagerberg, Jan, David C. Mowery and Richard R. Nelson
 
−
| year = 2004
 
−
| title = The Oxford Handbook of Innovations
 
−
| publisher = Oxford University Press
 
−
  | id = ISBN 0–19–926455–4
 
−
| pages = 1–26
 
−
| chapter = Innovation: A Guide to the Literature
 
−
}}
 
−
*{{cite journal
 
−
| last = Freeman
 
−
| first = Chris
 
−
| authorlink = Christopher Freeman
 
−
| year = 1984
 
−
| title= Prometheus Unbound
 
−
| journal = Futures
 
−
| volume = 16
 
−
| issue = 5
 
−
| pages = 494–507.
 
−
| doi= 10.1016/0016-3287(84)90080-6
 
−
}}
 
−
*{{cite book
 
−
| last = Freeman
 
−
| first = Chris
 
−
| authorlink = Christopher Freeman
 
−
| year = 1982
 
−
| title=  The Economics of Industrial Innovation
 
−
| publisher = Frances Pinter, London
 
−
}}
 
−
 
 
−
*{{cite book
 
−
| editor =Hesselbein, Frances, Marshall Goldsmith, and Iain Sommerville
 
−
| year = 2002
 
−
| title = Leading for Innovation: And organizing for results
 
−
| publisher = Jossey-Bass
 
−
| id = ISBN 0–7879–5359–8
 
−
}}
 
−
*{{cite book
 
−
| first = Waldo
 
−
| last = Hitcher
 
−
| year = 2006
 
−
| title = Innovation Paradigm Replaced
 
−
| publisher = Wiley
 
−
}}
 
−
*{{cite book
 
−
| last = Luecke
 
−
| first = Richard
 
−
| coauthors = Ralph Katz
 
−
| year = 2003
 
−
| title = Managing Creativity and Innovation
 
−
| publisher = Harvard Business School Press
 
−
| location = Boston, MA
 
−
| id = ISBN 1–59139–112–1
 
−
}}
 
−
*{{cite book
 
−
| last = Mckeown
 
−
| first = Max
 
−
  | authorlink = Max Mckeown
 
−
| year = 2008
 
−
| title = The Truth About Innovation
 
−
| publisher = Pearson / Financial Times
 
−
| isbn = 0273719122
 
−
| ref = CITEREFMckeown2008
 
−
}}
 
−
*{{cite journal
 
−
| last = Mansfield
 
−
| first = Edwin
 
−
| year = 1985
 
−
| title= How Rapidly Does New Industrial Technology Leak Out?
 
−
| journal = Journal of Industrial Economics
 
−
| volume = 34
 
−
| issue = 2
 
−
| pages = 217–223.
 
−
| doi= 10.2307/2098683
 
−
}}
 
−
*{{cite journal
 
−
| last = Miles
 
−
| first = Ian
 
−
| year = 2000
 
−
| title= Services Innovation: Coming of Age in the Knowledge Based Economy
 
−
| journal = International Journal of Innovation Management
 
−
| volume = 14
 
−
| issue = 4
 
−
| pages = 371–389.
 
−
| doi= 10.1016/S1363-9196(00)00020-2
 
−
}}
 
−
*{{cite book
 
−
| last = Miles
 
−
| first = Ian
 
−
| editor = Fagerberg, Jan, David C. Mowery and Richard R. Nelson
 
−
| year = 2004
 
−
| title = The Oxford Handbook of Innovations
 
−
| publisher = Oxford University Press
 
−
| id = ISBN 0–19–926455–4
 
−
| pages = 433–458
 
−
| chapter = Innovation in Services
 
−
}}
 
−
*{{cite journal
 
−
| last = Nelson
 
−
| first = Richard
 
−
| coauthors = Winter, S
 
−
| year = 1977
 
−
| title= In search of a useful theory of Innovation
 
−
| journal = Research Policy
 
−
| volume = 6
 
−
| issue = 1
 
−
| pages = 36–76
 
−
| doi= 10.1016/0048-7333(77)90029-4
 
−
}}
 
−
*OECD ''The Measurement of Scientific and Technological Activities. Proposed Guidelines for Collecting and Interpreting Technological Innovation Data. Oslo Manual.'' 2nd edition, DSTI, OECD / European Commission Eurostat, Paris 31 Dec 1995.  
 
−
*{{cite journal
 
−
| last = O'Sullivan
 
−
| first = David
 
−
| year = 2002
 
−
| title = Framework for Managing Development in the Networked Organisations
 
−
| journal = Journal of Computers in Industry
 
−
| volume = 47
 
−
| issue = 1
 
−
| pages = 77–88
 
−
| id = {{ISSN|0166–3615}}
 
−
| publisher = Elsevier Science Publishers B. V.
 
−
| doi = 10.1016/S0166-3615(01)00135-X
 
−
}}
 
−
*{{cite book
 
−
| last = Rogers
 
−
| first = Everett M.
 
−
| authorlink = Everett Rogers
 
−
| year = 1962
 
−
| title = Diffusion of Innovation
 
−
| publisher = Free Press
 
−
| location = New York, NY
 
−
}}
 
−
*{{cite book
 
−
| last = Rosenberg
 
−
| first = Nathan
 
−
| authorlink = Nathan Rosenberg
 
−
| year = 1975
 
−
| title = Perspectives on Technology
 
−
| publisher = Cambridge University Press
 
−
| location = Cambridge, London and N.Y.
 
−
}}
 
−
*{{cite book
 
−
| last = Schumpeter
 
−
| first = Joseph
 
−
| authorlink = Joseph Schumpeter
 
−
| year = 1934
 
−
| title = The Theory of Economic Development
 
−
| publisher = Harvard University Press
 
−
| location = Cambridge, MA
 
−
}}
 
−
 
 
−
*{{cite book
 
−
| last = Scotchmer
 
−
| first = Suzanne
 
−
| year = 2004
 
−
| title = Innovation and Incentives
 
−
| publisher = MIT Press
 
−
| location = Cambridge, MA
 
−
}}
 
−
 
 
−
*{{cite book
 
−
| last = Stein
 
−
| first = Morris
 
−
| year = 1974
 
−
| title = Stimulating creativity
 
−
| location = New York
 
−
| publisher = Academic Press
 
−
}}
 
−
*{{cite journal
 
−
| last = Utterback
 
−
| first = James M.  
 
−
| coauthors = Fernando F. Suarez.
 
−
| year = 1993
 
−
| title = Innovation, Competition, and Industry Structure
 
−
| journal = Research Policy
 
−
| volume = 22
 
−
| issue = 1
 
−
| pages = 1–21
 
−
| doi = 10.1016/0048-7333(93)90030-L
 
−
}}
 
−
*{{cite book
 
−
| last = von Hippel
 
−
| first = Eric
 
−
| authorlink = Eric von Hippel
 
−
| year = 2005
 
−
| title = Democratizing Innovation
 
−
| publisher = MIT Press
 
−
| id = ISBN 0–262–22074–1
 
−
}}
 
−
*{{cite journal
 
−
| last = Woodman
 
−
| first = Richard .W.
 
−
| coauthors = John E. Sawyer, Ricky W. Griffin
 
−
| year = 1993
 
−
| title = Toward a theory of organizational creativity
 
−
| journal = Academy of Management Review''
 
−
| volume = 18
 
−
| issue = 2
 
−
| pages = 293–321
 
−
| doi = 10.2307/258761
 
−
}}
 
−
*{{cite journal
 
−
| last = Wolpert
 
−
| first = John
 
−
| year = 2002
 
−
| title = Breaking Out of the Innovation Box
 
−
| journal = Harvard Business Review
 
−
| volume = August
 
−
}}
 
−
*{{cite book
 
−
| last = Veneris
 
−
| first = Yannis
 
−
| year = 1984
 
−
| title = The Informational Revolution, Cybernetics and Urban Modelling, PhD Thesis
 
−
| publisher = University of Newcastle upon Tyne, UK
 
−
}}
 
−
*{{cite journal
 
−
| last = Veneris
 
−
| first = Yannis
 
−
| year = 1990
 
−
| title = Modeling the transition from the Industrial to the Informational Revolution
 
−
| journal = Environment and Planning A
 
−
| volume = 22
 
−
| issue = 3
 
−
| pages = 399–416
 
−
| doi = 10.1068/a220399
 
−
}}
 
−
</div>
 
  
−
===Notes===
 
−
<references />
 
  
 
==External links==
 
==External links==
−
 
+
All links retrieved February 11, 2009.
−
 
 
 
* Academic article on [http://papers.ssrn.com/sol3/papers.cfm?abstract_id=964672 Being a Systems Innovator] on SSRN
 
* Academic article on [http://papers.ssrn.com/sol3/papers.cfm?abstract_id=964672 Being a Systems Innovator] on SSRN
 
*[http://ec.europa.eu/enterprise/innovation/communication.htm "Communication on Innovation policy: updating the Union’s approach in the context of the Lisbon strategy"] – The [[European Commission]].
 
*[http://ec.europa.eu/enterprise/innovation/communication.htm "Communication on Innovation policy: updating the Union’s approach in the context of the Lisbon strategy"] – The [[European Commission]].
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[[Category:Science and technology studies]]
 
[[Category:Science and technology studies]]
 
[[Category:Economics]]
 
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{{credits|Innovation|269731888|}}

Revision as of 19:37, 11 February 2009

File:Innovation.JPG
A personification of innovation as represented by a statue in The American Adventure in the World Showcase pavilion of Walt Disney World's Epcot.

The term innovation means “the introduction of something new,” or “a new idea, method or device.” Innovation characteristically involves creativity, but is not synonymous with it. Innovation is distinct from invention and involves the actual implementation of a new idea or process in society. Innovation is an important topic in the study of economics, history, business, technology, sociology, policy making and engineering. Historians, sociologists and anthropologists study the events and circumstances leading up to innovations and the changes they bring about in human society. Social and economic innovations often occur spontaneously, as human beings respond in a natural way to new circumstances. Since innovation is believed to drive economic growth, knowledge of the factors that lead to innovation is critical to policy makers.

In organizations and businesses, innovation is linked to performance and growth through improvements in efficiency, productivity, quality, and competitive positioning. Businesses actively seek to innovate in order to increase their market share and ensure their growth. A successful innovation does not always bring about the desired results and may have negative consequences. A number of economic theories, mathematical formulas, management strategies and computer business models are used to forecast the outcome of an innovation. Innovation leading to increased productivity is the fundamental source of increasing wealth in an economy. Various indices, such as expenditure on research, and factors such as availability of capital, human capacity, infrastructure, and technological sophistication are used to measure how conducive a nation is to fostering innovation.

The concept of innovation

The term “innovation” dates from the 15th century and means “the introduction of something new,” or “a new idea, method or device.”[1]. In its modern usage, a distinction is typically made between an idea, an invention (an idea made manifest), and innovation (ideas applied successfully). [2]. Innovation is an important topic in the study of economics, business, technology, sociology, policy making and engineering. In each of these fields “innovation” connotes something slightly different.

Innovation has been studied in a variety of contexts, and scholars have developed a wide range of approaches to defining and measuring innovation. A consistent theme in discussions of innovation is the understanding that it is the successful introduction of something new and useful, for example introducing new methods, techniques, or practices or new or altered products and services.[3] Though innovation is frequently associated with improvement and thought of as being positive and beneficial, the successful introduction of a “new” and “useful” method, practice or product may have negative consequences for an organization or society, such as the disruption of traditional social relationships or the obsolescence of certain labor skills. A “useful” new product may have a negative impact on the environment, or may bring about the depletion of natural resources.

Innovation, creativity and invention

Invention, the creation of new forms, compositions of matter, or processes, is often confused with innovation.  An invention is the first occurrence of an idea for a new product or process, while innovation involves implementing its use in society. [3]The electric light bulb did not become an innovation until Thomas Edison established power plants to furnish electricity to streetlamps and houses so that the light bulbs could be used. In an organization, an idea, a change or an improvement is only an innovation when it is implemented and effectively causes a social or commercial reorganization.

Innovation characteristically involves creativity, but is not synonymous with it. A creative idea or insight is only the beginning of innovation; innovation involves acting on the creative idea to bring about some specific and tangible difference. For example, in a business or organization, innovation does not occur until a creative insight or idea results in new or altered business processes within the organization, or changes in the products and services provided.

Sociology, history, behavioral sciences

Historians, sociologists and anthropologists study the events and circumstances leading up to innovations and the changes they bring about in human society. One of the greatest innovations in human history was the Industrial Revolution, which ended feudalism, led to the establishment of huge urban centers, and put power in the hands of businessmen. The concentration of large numbers of people in cities and towns and the rise of a middle class resulted in innovations in housing, public health, education, and the arts and entertainment. The Industrial Revolution itself was the result of myriads of innovations in technology, social organization, and banking and finance. The establishment of a democratic government in the United States in 1776 was an innovation that had far-reaching consequences for European countries and eventually for the rest of the world.

The development of modern forms of transportation, the train, automobile, and airplane, also altered the way in which people live and conduct business. Innovations in weaponry, such as the cannon and musket, and more recently, guided missiles and nuclear bombs, gave the nations who implemented them dominance over other nations.

During the last decade of the 20th century and the first decade of the 21st century, technological innovations like the cell phone, internet and wireless technology transformed the way in which people communicate with each other and gain access to information. Cell phones have made it possible for people in developing countries, who previously did not have access to an efficient telephone system, to communicate freely and easily, facilitating business transactions and social relationships. The internet allows people in countries where governmental control or inadequate economic resources limit access to information, to circumvent those restrictions and disseminate knowledge internationally. Individuals now have immediate access to information about the stock market, their bank accounts, current events, the weather, and consumer products.

Policy making

Social and economic innovations often occur spontaneously, as human beings respond in a natural way to new circumstances. Governments, legislators, urban planners and administrators are concerned with bringing about deliberate innovation through creating and implementing effective public policies to achieve certain goals. The cost of enforcing a new public policy must be weighed against the expected benefits. A policy change may have unforeseen, and sometimes unwanted, consequences.

Examples of public policies that have brought about positive social innovations are the granting of property rights to women, universal suffrage, welfare and unemployment compensation and mandatory education for children. Examples of public policy that resulted in harmful innovation are the Cultural Revolution initiated in 1966 by Mao Zedong, which closed universities and suppressed education for several years in China; the collectivization of agriculture in the U.S.S.R. by Joseph Stalin [4] which caused millions to die of starvation during 1931 and 1932; and the efforts of Pol Pot (Saloth Sar) in the 1970s to evacuate all urban dwellers to the countryside and return to an agricultural barter economy, which cost the lives of approximately 26 percent of Cambodia’s population. [5]

Organizations

In the context of an organization such as a corporation, local government, hospital, university, or non-profit organization, innovation is linked to performance and growth through improvements in efficiency, productivity, quality, and competitive positioning. A new management procedure, organizational structure, method of operation, communications device or product may be introduced in an effort to make the organization more efficient and productive. Successful innovation requires the definition of goals, knowledge of the materials and processes involved, financial and human resources, and effective management. A certain amount of experimentation is also necessary to adjust the new processes so that they produce the desired result.

Deliberate innovation involves risk. Organizations that do not innovate effectively may be destroyed by those that do. While innovation typically adds value, it may also have a negative or destructive effect as new developments clear away or change old organizational forms and practices. If the changes undermine employee morale, the new system may be less efficient than the old. Innovation can also be costly. The expense of purchasing and installing new equipment, computers and software, or of re-organizing, hiring and training staff is substantial, and may leave an organization without sufficient resources to continue its operations effectively. Organizations attempt to minimize risk by studying and analyzing innovations carried out by other organizations, by employing experts and consultants to carry out the innovation, and by following a number of formulas and management strategies.

The introduction of computers during the second half of the 20th century necessitated innovation in almost every type of organization. The productivity of individual workers was increased, and many clerical jobs were eliminated. Organizations made large investments in technology and created entire departments to maintain and manage computers and information, giving rise to a number of new professions. Paper documents were translated into electronic data. The workforce acquired new skills, and those who could not adapt dropped behind younger workers who were more familiar with technology and changed the dynamics of the workplace. Networks and internet connections allowed frequent and rapid communication within an organization. The centralization of information such as inventory, financial accounts and medical records made new types of analysis and measurement possible. While organizations benefited in many ways from the new technology, the expense and risk of innovating also increased.

Economics and business

The study and understanding of innovation is particularly important in the fields of business and economics because it is believed that innovation directly drives economic growth. The ability to innovate translates into new goods and services and entry into new markets, and results in increased sales. An increase in sales contributes to the prosperity of the workforce and increases its purchasing power, leading to a steady expansion of the economy.

In 1934, the European economist Joseph Schumpeter (1883 – 1955) defined economic innovation as:

  1. The introduction of a new good — that is one with which consumers are not yet familiar — or of a new quality of a good.
  2. The introduction of a new method of production, which need by no means be founded upon a discovery scientifically new, and can also exist in a new way of handling a commodity commercially.
  3. The opening of a new market, that is a market into which the particular branch of manufacture of the country in question has not previously entered, whether or not this market has existed before.
  4. The conquest of a new source of supply of raw materials or half-manufactured goods, again irrespective of whether this source already exists or whether it has first to be created.
  5. The carrying out of the new organization of any industry, like the creation of a monopoly position (for example through trustification) or the breaking up of a monopoly position:.[6]

Businesses recognize that innovation is essential for their survival, and seek to create a business model that fosters innovation while controlling costs[7]. Managers use mathematical formulas, behavioral studies and forecasting models to create strategies for implementing innovation. Business organizations spend between ½ of a percent (for organizations with a low rate of change) to more than 20 percent of their annual revenue on making changes to their established products, processes and services. The average investment across all types of organizations is four percent, spread across functions including marketing, product design, information systems, manufacturing systems and quality assurance.

Much of the innovation carried out by business organizations is not directed towards development of new products, but towards other goals such as reduction of materials and labor costs, improvement of quality, expansion of existing product lines, creation of new markets, reduction of energy consumption and lessening of environmental impact.

Many "breakthrough innovations" are the result of formal research and development, but innovations may be developed by less formal on-the-job modifications of practice, or through the exchange and combination of professional experience.

The traditionally recognized source of innovation is manufacturer innovation, where a person or business innovates in order to sell the innovation. Another important source of innovation is end-user innovation, in which a person or company develops an innovation for their own use because existing products do not meet their needs. [8] User innovators may become entrepreneurs selling their product, or more commonly, trade their innovation in exchange for other innovations or services. In the case of computer software, they may choose to freely share their innovations, using methods like open source. In such networks of innovation the creativity of the users or communities of users can further develop technologies and their use.

Analysts debate whether innovation is mainly supply-pushed (based on new technological possibilities) or demand-led (based on social needs and market requirements). They also continue to discuss what exactly drives innovation in organizations and economies. Recent studies have revealed that innovation does not just happen within the industrial supply-side, or as a result of the articulation of user demand, but through a complex set of processes that links input from not only developers and users, but a wide variety of intermediary organizations such as consultancies and standards associations. Examination of social networks suggests that much successful innovation occurs at the boundaries of organizations and industries where the problems and needs of users, and the potential of technologies are together in a creative process.

Diffusion of innovations

InnovationLifeCycle.jpg

Once innovation occurs, innovations may be spread from the innovator to other individuals and groups. In 1962, Everett Rogers proposed that the life cycle of innovations can be described using the ‘s-curve’ or diffusion curve. The s-curve maps growth of revenue or productivity against time. In the early stage of a particular innovation, growth is relatively slow as the new product establishes itself. At some point consumer demand increases and product sales expand more rapidly. New incremental innovations or changes to the product allow growth to continue. Towards the end of its life cycle growth slows and may even begin to decline. In the later stages, no amount of new investment in that product will yield a normal rate of return.

Innovative companies will typically be constantly working on new innovations that will eventually replace older ones. Successive s-curves will come along to replace older ones and continue to drive growth upwards. In the figure above the first curve shows a current technology. The second shows an emerging technology that currently yields lower growth but will eventually overtake the current technology and lead to even greater levels of growth. The length of life will depend on many factors. [9]

Bass diffusion model.gif

The Bass diffusion model developed by Frank Bass in 1969 illustrates the process by which a new innovative product is adopted by new users, then is overtaken by products imitating the innovation. The model is widely used in forecasting, especially product forecasting and technology forecasting.


Schumpeter's focus on innovation is reflected in Neo-Schumpeterian economics, developed by such scholars as Christopher Freeman[10] and Giovanni Dosi[11] .

In the 1980s, Veneris (1984, 1990) developed a systems dynamics computer simulation model which takes into account business cycles and innovations.

Innovation is also studied by economists in a variety of contexts, for example in theories of entrepreneurship or in Paul Romer's New Growth Theory.


Failure of innovation

Success in implementing an innovation does not guarantee a beneficial outcome. Research shows that from fifty to ninety percent of innovation projects are judged to have made little or no contribution to the goals of the innovating organization. Innovations that fail are often potentially ‘good’ ideas but do not achieve desired results because of budgetary constraints, lack of skills, poor leadership, lack of knowledge, lack of motivation, or poor fit with current goals. The impact of failure goes beyond the simple loss of investment. Failure can also lead to loss of morale among employees, an increase in cynicism and even higher resistance to change in the future. Most companies allow for the possibility of failure when planning an innovation, and include processes for detecting problems before they consume too many resources and threaten the organization’s future.

Early detection of problems and adjustment of the innovation process contribute to the success of the final outcome. The lessons learned from failure often reside longer in the organizational consciousness than lessons learned from success.

Measures of innovation

Attempts to measure innovation take place on two levels: the organizational level and the political level. Within an organization, innovation can be evaluated by conducting surveys and workshops, consulting outside experts, or using internal benchmarks. There is no measure of organizational innovation. Corporate measurements generally utilize scorecards which cover several aspects of innovation such as financial data, innovation process efficiency, employees' contribution and motivation, and benefits for customers. The elements selected for these evaluations vary widely from company to company and may include new product revenue, amount spent on research and development, time to market, customer and employee perception and satisfaction, number of patents, and additional sales resulting from past innovations.

On a political level, measures of innovation are used to compare one country or region with another. The OECD (Organisation for Economic Co-operation and Development ) Oslo Manual of 1995 suggested standard guidelines for measuring technological product and process innovation. The new Oslo Manual of 2005 added marketing and organizational innovation. The Bogota Manual was created in 2001 for Latin America and the Caribbean countries. A traditional indicator used to measure innovation is expenditure, for example, investment in R&D (Research and Development) as a percentage of GNP (Gross National Product).

Economists Christopher Freeman (born 1921) and Bengt-Åke Lundvall developed the National Innovation System (NIS) to explain the flow of technology and information which is key to the innovative process on the national level. According to innovation system theory, innovation and technology development are results of a complex set of relationships among people, enterprises, universities and government research institutes.

The 2008-2009 Global Innovation Index created by Soumitra Dutta, a professor at French business school INSEAD, along with New Delhi based non-profit organization The Confederation of Indian Industry [12] ranks nations based on indices such as the number of internet users in a nation, the ease of doing business and the stability of banks. Every factor is then categorized as either an input or an output. Inputs indicate how conducive countries are to fostering innovation, and include institutions and policies, human capacity, infrastructure, technological sophistication, business markets and capital. The outputs indicate how effectively countries translate innovation into benefits such as knowledge, competitiveness and wealth. The top ten countries are listed below:

Rank Country Region
1 Flag of United States United States North America
2 Flag of Germany Germany Europe
3 Flag of Sweden Sweden Europe
4 Flag of United Kingdom United Kingdom Europe
5 Flag of Singapore Singapore Asia
6 Flag of South Korea South Korea Asia
7 Flag of Switzerland Switzerland Europe
8 Flag of Denmark Denmark Europe
9 Flag of Japan Japan Asia
10 Flag of Netherlands Netherlands Europe

See also

  • Creative destruction
  • Creative problem solving
  • Theories of technology
  • Diffusion (anthropology)
  • Ecoinnovation
  • Emerging technologies
  • Hype cycle
  • Individual capital
  • Information revolution
  • Ingenuity
  • Invention
  • Innovation Economics
  • Open Innovation
  • Patent
  • Public domain
  • Research
  • Timeline of invention
  • User innovation
  • Value network

Notes

  1. ↑ “innovation” Merriam Webster. Retrieved February 9, 2009.
  2. ↑ Max Mckeown, The Truth About Innovation. Pearson / Financial Times. 2008. ISBN 0273719122
  3. ↑ 3.0 3.1 Jan Fagerberg, "Innovation: A Guide to the Literature" in Fagerberg, Jan, David C. Mowery and Richard R. Nelson. The Oxford Handbook of Innovations. Oxford University Press. 2004. pp. 1–26. ISBN 0–19–926455–4.
  4. ↑ Alan Bullock, Hitler and Stalin: Parallel Lives. London: HarperCollins, 1991 (hardcover, ISBN 0002154943); New York: Vintage Books, 1993 (paperback, ISBN 0679729941). p. 269
  5. ↑ The Cambodian Genocide Program. Genocide Studies Program. Yale University (1994-2008). Retrieved Retrieved February 10, 2009.
  6. ↑ Schumpeter, Joseph (1934). The Theory of Economic Development. Harvard University Press, Boston. 
  7. ↑ Davila, Tony; Marc J. Epstein and Robert Shelton Making Innovation Work: How to Manage It, Measure It, and Profit from It. Upper Saddle River: Wharton School Publishing. 2006. ISBN 0–13–149786–3 p. 6
  8. ↑ von Hippel, Eric (1988). The Sources of Innovation Retrieved February 10, 2009. Oxford University Press. ISBN 0–19–509422–0. 
  9. ↑ Rogers, Everett M. (2003).Diffusion of Innovations, 5th ed.. New York, NY: Free Press.
  10. ↑ Freeman, Christopher (1982). The Economics of Industrial Innovation. Frances Pinter, London.. 
  11. ↑ Dosi, Giovanni (1982). Technological paradigms and technological trajectories. Research Policy 11 (3): 147–162.
  12. ↑ United States The World's Number One Innovator? Saabira Chaudhuri, Fast Company (January 7, 2009) Retrieved February 9, 2009.

References
ISBN links support NWE through referral fees

  • Barras, R. "Towards a theory of innovation in services". Research Policy 15: 161–73. 1984.
  • Cabral, Regis. "Development, Science and". in Heilbron, J.. The Oxford Companion to The History of Modern Science. New York: Oxford University Press. 2003. pp. 205–207.
  • Chakravorti, Bhaskar. The Slow Pace of Fast Change: Bringing Innovations to Market in a Connected World. Boston, MA: Harvard Business School Press. 2003.
  • Byrd, Jacqueline. The Innovation Equation - Building Creativity & Risk Taking in your Organization. San Francisco, CA: Jossey-Bass/Pfeiffer - Aprint. 2003. ISBN 0-7879-6250-3.
  • Chesbrough, Henry William. Open Innovation: The New Imperative for Creating and Profiting from Technology. Boston, MA: Harvard Business School Press. 2003. ISBN 1–57851–837–7.
  • Christensen, Clayton M. . The Innovator's Dilemma. Boston, MA: Harvard Business School Press. 1997. ISBN 0–06–052199–6.
  • Davila, Tony; Marc J. Epstein and Robert Shelton. Making Innovation Work: How to Manage It, Measure It, and Profit from It. Upper Saddle River: Wharton School Publishing. 2006. ISBN 0–13–149786–3.
  • Ettlie, John. Managing Innovation, Second Edition. Butterworth-Heineman, an imprint of Elsevier. 2006. ISBN 0–7506–7895-X.
  • Fagerberg, Jan. "Innovation: A Guide to the Literature". in Fagerberg, Jan, David C. Mowery and Richard R. Nelson. The Oxford Handbook of Innovations. Oxford University Press. 2004. pp. 1–26. ISBN 0–19–926455–4.
  • Freeman, Chris. The Economics of Industrial Innovation. Frances Pinter, London. 1982.
  • Hesselbein, Frances, Marshall Goldsmith, and Iain Sommerville, ed (2002). Leading for Innovation: And organizing for results. Jossey-Bass. ISBN 0–7879–5359–8.
  • Hitcher, Waldo. Innovation Paradigm Replaced. Wiley. 2006.
  • Luecke, Richard; Ralph Katz. Managing Creativity and Innovation. Boston, MA: Harvard Business School Press. 2003. ISBN 1–59139–112–1.
  • Mckeown, Max. The Truth About Innovation. Pearson / Financial Times. 2008. ISBN 0273719122.
  • Miles, Ian. "Innovation in Services". in Fagerberg, Jan, David C. Mowery and Richard R. Nelson. The Oxford Handbook of Innovations. Oxford University Press. 2004. pp. 433–458. ISBN 0–19–926455–4.
  • OECD The Measurement of Scientific and Technological Activities. Proposed Guidelines for Collecting and Interpreting Technological Innovation Data. Oslo Manual. 2nd edition, DSTI, OECD / European Commission Eurostat, Paris 31 Dec 1995.
  • Rogers, Everett M. Diffusion of Innovation. New York, NY: Free Press. 1962.
  • Rosenberg, Nathan Perspectives on Technology. Cambridge, London and N.Y.: Cambridge University Press. 1975.
  • Schumpeter, Joseph. The Theory of Economic Development. Cambridge, MA: Harvard University Press. 1934.
  • Scotchmer, Suzanne. Innovation and Incentives. Cambridge, MA: MIT Press. 2004.
  • Stein, Morris. Stimulating creativity. New York: Academic Press. 1974.
  • von Hippel, Eric . Democratizing Innovation. 2005. MIT Press. ISBN 0–262–22074–1.


External links

All links retrieved February 11, 2009.


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