General Innovation

Innovation is the conversion of ideas into cash and Invention is the conversion of cash into ideas.

Do you work in the Innovation business or are you an Inventor… do you know the difference?

I was intrigued when I originally wrote this post way back in January after reading a story that defined the meaning of innovation as the execution of an idea, whereas creativity was having the idea in the first place. Most people I speak to would instinctively lump these two things together and call them innovation. So, I went off to the web to check this out; here I found a number of meanings. A couple that jumped off the page were…

 “Innovation can be described as the result of some amount of time and effort into researching (R) an idea, plus some larger amount of time and effort into developing (D) this idea, plus some very large amount of time and effort into commercialising this idea into a market place with customers”.

Being from an R&D background, this strikes a chord with me as it combines the idea and the delivery, and more importantly it goes further to look at commercialising… I wonder how many companies put all of their effort into the first two parts and forget the last and arguably most important part?  I have to say that I’ve seen this happen on more than one occasion.

Building on this point, I came across another thought provoking statement…

“Innovation is the conversion of ideas into cash. Invention is the conversion of cash into ideas.”

How many businesses set out to innovate but end up inventing? How many people remember the £40 million ATP Train innovation or invention? How many businesses really turn ideas into cash?  How many innovations end up costing the company a small fortune? And how many great ideas have gone down the pan because a company couldn’t commercialise them?

Back in january, I was watching this youtube video posted by Dennis Howlett, It’s a chap called R “Ray” Wang presenting how a major software vendor had failed to commercialise some great ideas.

Why does this happen? Did they get it wrong from a customer perspective? Did they work with customers to see if the original ideas were valued before they went on to deliver them? Did they fail to commercialise them? Do the company see this as a failure? Or was it actually a ‘share of voice’ Marketing and PR success despite the ideas not being widely adopted? Plenty of food for thought, and only the vendor themselves will know the answers.

Is the secret behind innovating to ask customers what they want before you start?

Controversially, I would have to say no to this question, well not entirely anyway… Whilst, I would advocate speaking to customers at all times and involving them through the process to add value, you can’t always rely on customers as your only source of “innovative ideas”. What’s more the customer will most likely be focused on today’s issues as opposed to looking for step change innovation. Henry Ford’s classic quote (where would we all be without good old Henry Ford and his horse), sums this up nicely…

“If I had asked my customers what they wanted, they would have told me a faster horse.”

To be really successful in business I believe you have to continually innovate and generate new ideas, not by relying solely on customers to tell you what they want, but by understanding how your customers work, what they need today, and where they are headed in the future.

In my experience the best and most successful innovations are the ones where you deliver something that the customer didn’t know they needed but can’t live without. But they don’t come along by accident, you have to be prepared to sow the seeds and nurture the idea, which takes patience and resolve, and it could take years. 

And what happens when you run out of ideas?

Go visit a bunch of customers!

2 replies on “Innovation is the conversion of ideas into cash and Invention is the conversion of cash into ideas.”

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