12 Aug When Invention Becomes Innovation
Here’s a shocking proclamation: Not only is creativity a joke, so is innovation! That’s right, I’m proclaiming that innovation is a joke, too! Now why am I saying that? Because, for some reason individuals, especially inventors, are under the erroneous assumption that inventing stuff is important, and that’s where value is created. Well, if that’s the case, why are fewer than one percent of the nearly 2,000 patents filed with the U.S. Patent and Trademark Office every single week? Why do fewer than one percent of those technologies actually succeed in the market?
The answer is simple. People misunderstand where value is actually created. If you don’t understand this principle, you cannot succeed at innovation. Yet, surprisingly, many companies are in the “creativity and innovation” initiative business. I strongly believe this thought process is misguided, and if you look at the great organizations around the world, their focus is not on creativity; these companies look at innovation as just an instrument. Their focus is not on innovation, which is simply a delivery system. Their focus, rather, is on creating customer value.
Where there’s risk….
Now, how do you create customer value? Here’s the bad news: You’ve got to be willing to fail. You can’t get around it! Even as a successful inventor, I’ve spent half my life trying to get around the cosmic law of risk and reward. I’ve often wondered why inventors and innovators believe they can somehow circumvent the cosmic law of risk and reward. What is that law you ask? The answer is: An innovation is only as valuable as the meaningful net value it delivers, no matter the risk.
Almost always, risk equates to success. There is no such thing as a breakthrough technology that wasn’t risky. In the book Priority Management identifying and managing unsolvable problems by Barry Johnson PhD HRD Press, the author talks about the difference between managing your risk and delivering value to your customer by taking risks. Of course, it’s a great point. We need to find the equilibrium risk and value in our organizations.
But it’s not just about risk…
I may have confused you just a bit. First, I told you that creativity alone doesn’t do it. That should be pretty clear since undirected or misdirected creativity can make for some nice, colorful storyboards or products that, unfortunately, don’t interest anyone and don’t sell. Then I said innovation is a joke, and moreover, that successful innovation entails taking risk. Well, it turns out there’s still more to the story.
Here’s the reality and the real message. Innovation is not a joke if certain conditions are met. And here’s the main condition: It must deliver customer value. An idea that is simply creative and goes no further, or takes risk but goes no further, go far enough. It must be ready to go to market, and to go to market, it must be something that a customer is willing to buy, that is, something worth more to the customer than the money he or she would part with to buy it, and is worth more than a competing product. But to really register a lasting impression with the customer, it must deliver more value than the customer expected. To be an innovator you need to create something that is exceptional.
I want to revisit the distinction between invention and innovation once again, because the idea is so important. You must redirecting your thought processes, and your organization’s thought processes, to be truly innovative:
- An invention is an idea transformed into physical or intellectual reality.
- An innovation is an idea designed to meet – or preferably, exceed – a customer need.
- An invention becomes an innovation when – and because – it delivers net customer value.