Innovation is the lifeblood of modern business and the defining characteristic of InformationWeek 500 companies. To these companies, innovation isn't just a buzzword. Their creative, even pioneering, technology initiatives are producing clear business results, which we chronicle in this special IW 500 digital issue.
Elsewhere, however, the word innovation has become "so broadly defined that it has lost all meaning," writes InformationWeek contributor Coverlet Meshing. "The innovation industrial complex produces fast food -- innovation in a can, with loads of salt, sugar and fat."
Look around. Almost every company in every industry seems to be touting a new innovation center, incubator, lab, council, committee or cabal. Every process improvement is hailed as a paradigm shift. Every new product is a breakthrough.
Recent company press releases reveal glimpses of this junk diet. One energetic company whose business or product I still can't divine says it "provides innovative solutions to articulate, unify and manage brand impact." Digital business leader Starbucks recently introduced what it called an "innovative cross-channel, multi-brand loyalty program" -- a fine program, no doubt, but don't companies in a range of industries (airline, banking, entertainment, casinos) already have similar ones? Even Procter & Gamble, a mainstay on annual Top 10 Innovator lists, can go over the top. On its "P&G Innovations" website, it boasts about lots of pedestrian products, including shaving cream for men with sensitive skin, batteries that offer "long-lasting power" and the first flavor-coated, 24-hour pill for treating frequent heartburn.
A Google search on the word "innovation" produces 243,000,000 results. I confess to not having clicked on all of those links, but I suspect that a couple of hundred million of the products and ideas therein are underwhelming.
Before we can understand what innovation is, we must first understand what it's not. "Faux innovation," let's call it, falls into three main categories:
-- The clever, even brilliant, idea from that guy in the garage that never turns into a profitable commercial product at large scale. Writes one reader commenting on the Meshing column: "Commercialization is where that geek faces the realities that will create a million happy customers. I've had cartoons of me and the light bulb flashed on screens, and my thought is always the same, 'Call me when we have shipped a half million.'"
-- The incremental new product or product advancement whose commercial success owes more to the vendor's established market presence than to anything particularly special about the output itself. Think P&G's new shaving cream. Granted, the iPhone took off as fast as it did partly because of Apple's rabid customer base, but there's no denying that the facile user interface and sleek design of this first-of-its-kind handheld computer were major factors in its blockbuster success.
-- Pure bluster, plain and simple. Mundane products hyped as breakthroughs without any supporting evidence.
True innovations change how people work and play. They change how products are bought and sold. They're the result of a tremendous amount of hard work and ingenuity, but they often seem obvious in hindsight.
Sometimes innovations are slow out of the gate. For example, the VisiCalc spreadsheet, invented in the 1970s by Dan Bricklin, was never a mass-market success, but later adaptations by more established vendors (Lotus 1-2-3 and then Microsoft Excel) transformed financial calculation and reporting.
Sebastian Thrun, CEO of MOOC (massive open online course) pioneer Udacity, writes in a blog post that most innovations take time to mature. "To all those people who declared our experiment a failure, you have to understand how innovation works," Thrun wrote after a study showed a Udacity MOOC producing superior student performance at San Jose State University. "Few ideas work on the first try. Iteration is key to innovation."
Innovation In A Box?
Innovation gurus put forth their innovation templates. A Forbes article by four Bain consultants, for example, exhorts business leaders to set a clear strategy and build an organizational culture for innovation, as well as create processes for generating, developing and scaling ideas and managing a diverse portfolio of innovations. Pretty straightforward stuff.
But InformationWeek columnist Meshing insists that corporate innovation isn't a repeatable process. You don't see a central innovation group at Apple. It's just part of the company culture even if founder Steve Jobs never did set about "building" such a culture.
Companies that are good at innovation do tend to be more open to it and work harder at it than also-rans. In the realm of technology, think companies that allow shadow IT and skunk works and make a conscious effort to reverse the 80/20 rule. If an innovative company does create a formal team or group to add some structure and process to its cutting-edge work, those people tend to get a long leash. How long depends on the size and maturity of the company and the pressure it's under to produce wins in the short term.