Innovation begins with Creativity

Stephen DeAngelis

August 27, 2014

“‘Creativity’ and ‘innovation’,” writes Nicole Fallon (@nicolefallon90), “are two words that constantly get thrown around in brainstorming sessions, corporate meetings and company mission statements. There’s no question that these values are highly prized in the fast-paced modern workplace, but do leaders who use the terms truly know the difference between them?” [“Creativity Is Not Innovation (But You Need Both),” Business News Daily, 24 July 2013] Fallon cites the work of Shawn Hunter (@gshunter), author of Out Think: How Innovative Leaders Drive Exceptional Outcomes, who “defines creativity as the capability or act of conceiving something original or unusual, while innovation is the implementation or creation of something new that has realized value to others. Business leaders frequently interchange creativity and innovation, without understanding what separates the two.”

 

Greg Satell (@DigitalTonto) shares a similar view. He writes, “Some say that it’s not an innovation if there isn’t an economic payoff. Or even more strictly, that without a new product, it’s not innovation. Others say that innovation is driven by discoveries … that we must engage in search and discovery activities even though we have no idea what practical applications will arise.” [“The Usefulness of Useless Things, Digital Tonto, 3 March 2013] He continues:

“Even though these seem like opposites, you must do both. … On the one hand, if you want to stay in business, the ideas that you execute need to create value. Then you have to convert that value into something that helps you pay the bills. If you’re not innovating around your core, you are vulnerable to competition from people that are. So while it’s not true that you’re not innovating if it doesn’t create a new product, it is true that you need to create value with your innovations so that you can generate some sort of return.”

In other words, you can be creative without being innovative, but you can’t be innovative without being creative. Tim Kastelle (@timkastelle) views innovation as a process that involves both ideation (i.e., the creative part) and execution (i.e., the part that generates value). He writes, “Lukas Fittl tackles this issue nicely by talking about the distinction between ideation and execution – what he refers to as the flipping the ideation switch.” [“When is an Innovation an Innovation?The Discipline of Innovation, 3 March 2013] Fittl portrays the innovation process in the attached graphic.

 

 

The “result” in the image must be something of value if it is to be considered an innovation. Mary Meehan (@PanoramixGlobal), founder and Chief Intelligence Officer at Panoramix Global, reminds us that innovation is hard. “Innovation gets a lot of lip service,” she writes, “but success remains stubbornly out of reach for many among even our best and brightest companies.” [“Innovation Ready: The 5 Traits Innovative Companies Share,Forbes, 8 July 2014] In her article, Meehan discusses on the research of Uri Neren, who, back in 2007, studied “the best practices of companies that most often succeed at innovation.” Meehan’s article focuses “on the top five [practices] that serve as a guide to Neren’s broader findings.” During an interview Meehan conducted with Neren, “he described the five business practices that help make innovation repeatable and reliable.” They are: belief systems; structure; research-driven processes; encouraging and rewarding talent; and creating a connected culture. Those five characteristics help institutionalize the innovation process. Hunter is among those who believe that innovation must be institutionalized. He told Fallon, “Innovation isn’t a mysterious black box. It can be simple small tweaks to existing processes, products or interactions. And by focusing on the process [of innovation], and not the heroically creative individual, we can build innovation at scale.” Fallon continues, “In other words, process is replicable and scalable; a creative individual is not. Once leaders understand the difference between creativity and innovation, they can work on inspiring both among their team members — and building a culture that supports these values.”

 

Andrew Stein (@AndrewJStein), a Senior Strategy, Marketing & Sales Executive, agrees that invention (i.e., creativity) is not the same as innovation and he argues that inventions need to create value before they can be called innovations. [“5 Elements To Transform Invention Into Innovation,” Steinvox, 26 February 2013] He asserts that “the common five elements to transform invention into innovation seem to be unique combinations of the following”:

 

  • Disruption – A product, process or service needs to radically disrupt the status quo of the nature that Clayton Christensen defines. If the invention is not interesting, nor does it have unique value and cost differentiation, it’s just an incremental innovation, at best. (Incremental innovation is fine, but uninteresting in the context here. And, it is always a target to be marginalized by true disruptive innovation. One might see the Automotive or transportation industry in general, as an example of annual incremental innovation, readily a target for disruptive innovation like Google’s driverless cars, or Star Trek’s Transporter – Think BIG.)
  • Business Model Structure – The invention stands a greater chance for success if it has obvious and immediate value to the buyer (B2B or B2C), and that is often a function of a business model disruption. I haven’t done the math, but I suspect that my kids have spent more for music at $0.99 a song, than I did in college, buying albums on CD for $19.99. The price seems lower, but the business model structure is such that it’s easier to buy more, more often, and feel good about it.
  • Business Model Infrastructure – Slightly different than the prior element, this involves leveraging the business model infrastructure available. Think of this as the shift from cash registers to Point of Sale (POS) terminals. Or more recently, the transition from credit cards to the virtual wallet. For most industries (B2B or B2C), it’s the transition to online, not just for retail, but in terms of any and all financial transactions and fair exchange of fees for products and services.
  • Adoption – The invention must have been lead with customer-centric design thinking. The kind that only professionally trained marketers can do successfully, efficiently, and at optimal cost and timing. Leading with marketing, especially in the social era, is to surround the invention with marketing as strategy – broad committed effort to gain customer interest, drive market adoption and build industry velocity. The outcome is adoption measured in terms of numbers of users and customers.
  • Timing – all of these elements are subject to timing. As products, services, customers and markets create an ecosystem of opportunity; it requires that these elements come together at a common time. They can be driven by a marketing as strategy, approach. Apple does this well. Others come together as industries anchored in legacy let go of the past. Banking, moving toward the virtual wallet is one example. The transition to SaaS and PaaS cloud software for ERP, and other critical back-office systems, is another.

 

Neren told Meehan that you need to “structure your organization to allow innovation to flow through it.” That’s why each of the pundits cited above stress the importance of structure and culture. Innovation is a process that begins with a creative idea and ends with producing something of value for the company. Kastelle concludes, “You can do all the discovery that you want, but if you don’t use it to create value, you won’t be in business for long.” In other words, an idea may start as a brainstorm, but, following the storm, you need to find the pot of gold at the end of the rainbow.