A great success story in innovation is the advent of the iPod.
The iPod was not the first portable music player: Sony engineers introduced the idea of “music anytime anywhere” in 1979 with the Walkman. Prior to 2001, the market was teeming with numerous MP3 devices. Apple waited. But as Steve Jobs promised, the iPod revolutionised the music industry, making it one of the most significant innovations of modern times. Apple’s solution to music was unique of its kind.
We can say that Apple invented nothing new. It did not engineer the first portable MP3 player, nor the first database of songs available to users. Inventions such as these already existed. Apple built upon these to create a device that consolidated a music catalog, its search, and its portable delivery all under one roof.
This article talks about taking the next step after invention. Every innovation is an invention in itself, but not every invention has the capability of turning into an innovation. Let us find out why.
Differentiating invention and innovation
Understanding the difference between innovation and invention is a must for business excellence. Research on innovation has refined our concepts by separating the two. Invention is generally understood as a process of creative advancement. It belongs to the realm of science and technology. Innovation, on the other hand, is the process of executing an invention or idea creatively to transform it into something that brings value for both business and customers. Thus, it is the introduction of a new product or a new combination into commerce and society.
“Use” value of innovation
We can say that invention is creating something new while innovation adds the “use” value to an invention. If you claim to be leaders in innovation by exhibiting a great list of patents, well you have not yet made your point. Patents are pieces of evidence of inventions. Unless the usefulness of an invention is proven, inventions cannot be comparable to innovations. Many patents do not eventually contribute in any way to the industry. Hence patents without a use value are not innovations.
Industry adoption occurs only when economic impact becomes clear. Entrepreneurs then begin turning technological possibilities into economic realities. In fact, very few inventions as a standalone are successful innovations: most revolutionary innovations are improvements to an existing process, use or function by one or many supporting inventions.
Economists opened the black box of technology when they realized that innovation is a driver for economic growth. At the same time, however, invention was put in its own opaque box, veiled under impenetrable layers of inspiration. As a result, technological development was redefined as consisting of two different phases: invention and its subsequent development into a product.
Many inventions that exemplify technological innovation have made significant contributions to our daily life. They are fine examples of human creative expression: the printing press, the steam engine, the telephone, the radio, television… Modern day innovations are the Internet, email, Google search and many others that have proved life-changing.
User-oriented approach to innovation
Great technology with no demand is wasted innovation, so every innovation is fundamentally social:
- Innovations are born out of user needs, while some innovations create new user needs.
- Later on, innovations appear in new social practices as users fit these into everyday customs.
Either way, users are always an integral part of the process.
Align innovation with your business model
Innovation implies offering something new into your business, such as:
- Improving processes to increase productivity or reduce costs.
- Extending scope or quality of your current offering to separate yourself from competition.
- Developing a new product to meet latest customer needs.
Introducing innovation can build brand value, expand your business with new partnerships, and therefore increase overall profit. Estimate both the market value of innovation before deciding on your strategy. Identifying how an opportunity will bring value to your business is a crucial move. Meanwhile, keep in mind that your innovation should bring value to your customers.
Businesses choose different types of innovation depending on the geolocation, market and customer demands. Innovations can be any one of the following types:
Incremental innovation
This type of innovation employs existing technologies to make small changes in product features to sustain market competition. This way you build value for your customers within your current market. Examples can be the incremental updates in software.
Architectural Innovation
Also referred to as localisation of a proven technology, architectural innovation involves applying the skills, the overall technology and the lessons learned from past experience into a completely new market. If said market has demand and is receptive of the new offering, then this type of innovation is an excellent choice to expand and grow your customer base. It may require some adjustments to match the interests in the newly implemented market. This is considered a reliable way forward because it has already been tested and proven in the past.
Reverse innovation
Vijay Govindarajan, author of Reverse Innovation (HBR Press, 2012), while defining the term mentioned that at its essence, reverse innovation describes solutions adopted initially for emerging nations that consequently find a market in developed nations. For example, Renault designed a low-cost model of its brand Logan for Eastern European markets that was also sold later in the Western European markets. Tata Motors introduced the Tata Nano for the price conscious buyers in India in 2009. Tata also plans to launch Tata Nano in Europe and U.S. afterwards.
Radical innovation
This kind of innovation gives birth to a new industry, a breakthrough that turns a new concept into a useful market. Radical innovations often have the potential to make it to top of the market.
Salesforce is a recent example of radical innovation. Its CRM system provides an innovative technological platform in the form of cloud computing and a new business model as well.
Disruption (Disruptive Innovation)
According to the Clayton Christensen of the Institute for Disruptive Innovation, this “theory explains the phenomenon by which an innovation transforms an existing market or sector by introducing simplicity, convenience, accessibility, and affordability where complication and high cost are the status quo. Initially, a disruptive innovation is formed in a niche market that may appear unattractive or inconsequential to industry incumbents, but eventually the new product or idea completely redefines the industry.” Examples of disruptive innovation are the introduction of digital photography, the replacement of landlines with mobile phones etc. Both were niches in the market upon their introduction, but gradually their demand scaled to great lengths.
Stories of innovative leaders
Smart internet: Google
Larry Page and Sergey Brin founded Google in 1998. They arrived after Yahoo but captured the market slow, steady but strong. Instead of reinventing the wheel, Google used tech available at its disposal and applied it in new and fascinating ways. The search engine and its extraordinarily adaptive algorithms helped redefine Internet use for many. With that said, the real innovations for Google often happen without you noticing it…
Google continually cultivates and hones its methods. Their innovation entails developing and adapting machine learning. With Google Brain, machine learning has had its impact in many other industries beyond search engine like the automobile industry, advertising, and healthcare. Thus as you can see innovation can not only improve your own business. If it is a positive life-changer for the users, you can become trendsetters in the industry.
Reinventing with time: IBM
The IBM PC (personal computer) did not incorporate any new inventions. Under stress to complete the project in less than 18 months, the team was under precise instructions not to invent anything new. The goal of the first PC, code-named “Project Chess,” was to use existing technology and resources to design something convenient for users, economical yet compelling.
The world’s first portable personal computer was an innovative product which allowed users to try their hands on a powerful computing device. IBM has constantly been reinventing with time: its current area of focus is its artificial intelligence genius, Watson.
Henry Ford Model T
The Model T, also known as the “Tin Lizzie,” changed the way Americans live, work and travel. Henry Ford’s revolutionary advancements in assembly-line automobile manufacturing made the Model T the first car to be affordable for a majority of citizens. For the first time, car ownership became a reality for average American workers, not just the wealthy.
Although automobiles already existed for decades, there was still a shortage, they were expensive, and unstable before the introduction of the Model T in 1908. Another great example of turning invention into innovation for the usefulness of the greater masses.
When lack of innovation failed companies
Touch me not, Blackberry
Blackberry was once the first choice for many professionals. But its refusal to adapt to touch-screen feature led to Blackberry’s decline. While at the same time touch-screen smartphones became popular in the market.
We could have been yahooing, but then…
Yahoo failed to reinvent itself giving way to its competitors to become the successive leaders. Google started later than Yahoo but invested heavily on better brain and skill capital than Yahoo. While Google expanded its website search through automated indexing and dynamic search options, Yahoo continued with manual indexing. Failure to evolve with time and technology, and lack of investment in innovation cost Yahoo a fortune and a future.
Understanding the importance of innovation is the first step towards creating its culture in your company. We at graphility can help fuel your inventions into innovative concepts for your brand.
Do you have more examples? Share them with us.