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WHAT IS INNOVATION?

 

How do you distinguish between an idea and innovation?  In organizations and  society generally this can be one of the most important issues that needs clarifying on a policy basis because the transformation from ideas to innovation is crucial.  An example, that I am aware of is a good illustration of what can happen:

I once worked for a large organization that had an Innovation Programme with monetary awards aimed at making it more successful.  It was widely advertised as an initiative of the board of directors following a merger with another large organization.  It was aimed at improving operations and customer service.  I was aware of one proposal that was put forward to change the high level accounting policy for cost control from broad brush annual percentage increase in cost control to best demontrated practise for similar business units.  This was an important reform when the organization had a substantially higher than the industry average expense to income ratios.

It was clearly a paradigm shift in the planning process and a better accounting policy – this was an idea! 

The innovation would have been to develop and set standards for similar business units and start to measure performance against the standards.

The full article in Wikipedia is worth reading: http://en.wikipedia.org/wiki/Innovation

Quote

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. (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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