Innovation Defined for Executives
It’s difficult to pin down what exactly innovation is. With every new product being called innovative, is it market-speak for ‘new’? Is it another way to say ‘better’? The embodiment of a potentially novel or useful idea? Then there are the ideas of disruptive innovation and breakthrough innovations which imply there are different innovations. What about innovation’s cousin, invention? Does an innovation require invention, is an invention by its nature innovative?
Making a succinct definition more challenging to find, innovation is often conflated with entrepreneurship. Entrepreneurship is the business processes needed to form, finance and launch a new company, which can be taught (and is). However, the study of entrepreneurship does not inform the myriad of decisions needed to bring an idea to market.
For the purposes of this book, innovation is an effort to change the status quo in a way that is advantageous to the sponsoring company. This change can be big or small, an inventive or not. The innovation can be a product, service, organization, way of working or another aspect of any business function such as logistics, operations, marketing, etc. The breadth of what can be innovative is what makes innovation such a difficult subject to understand, much less teach, much less lead. At Harvard Business School there are only 2 courses on innovation out of more than 100 electives to choose from.[i]
For the CEO innovation means something else entirely. For a role that values the ability to deliver consistently successful results innovation is threatening and risky. Here are just a few of the CEOs have lost their position because of their innovation management, or lack thereof.
Jeff Immelt, GE: Innovation without results created “success theater”.
Jan Singer, Victoria’s Secret: Heard what they wanted to hear, and missed what customers were actually saying.
Steve Balmer, Microsoft: A portfolio of poorly conceived products made it impossible for the company to keep up with competitors like Apple and Google.
Gary DiCamillo, Polaroid: Innovated in order to maintain their status quo.
Mark Fields, Ford: Too much focus on risky, long term, innovations, while letting atrophy shorter term, lower risk, innovation programs.
John Akers, IBM: Under investment in proprietary innovations resulted in their products becoming commoditized.
Effective innovation leadership doesn’t require Steve Jobs. It could be argued that some of the ex-CEOs on the list above lost their jobs because they were trying to imitate the Apple Co-Founder. Although successful innovators require an inventive mindset, successful innovation leadership requires a skeptical one.