It might sound really basic but it's actually a very interesting and thought-provoking question. Innovation means different things to different people depending on their role, company, industry, markets, competitive set, and the problem they are trying to address.
In a commoditized industry where competition is fixed, innovation might be all about operational efficiency. An example is Ford introducing the notion of an assembly line at a time when the market was exploding. The question was how to get automobiles in the hands of as many people as possible at low price points that the masses could afford, and the assembly line answered that question.
Innovation comes in many forms in software and technology. New products might come out of an advance or breakthrough in technology. The Intel chip, for example, spawned the PC market and with each new advance in chip technology, continues spawning new markets and products. Because of the Intel chip, smaller, faster chips made mobile computing a reality, creating new products and applications like the iPhone and Droid.
Innovation might also mean introducing a new approach to a problem or process. For example, the notion of "agile computing" is a new approach to developing software products. Agile was, in part, enabled through the advent of new technologies, such as service-oriented architecture and object-oriented development. But it's also a response to older methodologies like the sequential "waterfall" approach, where products were rolled out monolithically and all aspects of the product and delivery were developed as one big thing.
In B2C/consumer goods, innovation means something different entirely. There, innovation may come from mining ideas and sentiments from consumers. These ideas may come from traditional research or consumer insight approaches, such as focus groups, new product research, and testing, which spawn new ideas and ways to look at consumers and markets.
A classic example of this is P&G's Swiffer product. Consumers wanted a floor cleaning product that was as easy to use as a broom, as clean and neat as a paper towel, and easy to maneuver and store. Knowing these trends and consumer preferences enabled P&amp;amp;amp;G to conceive Swiffer. Here, innovation was a fundamentally new product that's cheap and easy to use and serves an existing market.
In this world, innovation might also come in the form of applying an existing product to a fundamentally new application or use case. A good example of this is baking soda. Initially, it's usage and market was simple -- baking. But innovative thinking about new applications combined with customer research can lead to new applications and uses. Today, baking soda is used to eliminate and control odors, as a cleaning product, and more. All of these "innovative uses" have opened new markets and applications for the product.
You probably get the picture as the examples go on and on. What are your thoughts on this? What does innovation mean to you and your organization?
Stay tuned to our B2B Innovation series for our next post where we'll unfold more about understanding what innovation is and why it's important.