What exactly is innovation?

Teresa Cottam explores the nature of innovation in an ICT context.


Frank R Paul, The Atomic Flying Car of the Future (1955)


At Telesperience we live and breathe innovation. We evaluate, judge, write about, analyse and ponder about innovation. Yet it never ceases to amaze me that there is such a poor understanding of what innovation actually is: what it looks like, feels like. Without a good understanding of innovation we can neither encourage the conditions to make it flourish, nor can we create effective innovation.


This latter point I will return to, because I think we often overlook the fact that innovation is not 'good' in itself. It is not a synonym for progress or success.


First, though, let's focus on what innovation actually is. Most definitions of innovation embrace the idea of effectiveness: this is a (well meaning) mistake. Innovation merely means something new or, more correctly, 'the act of introducing something new' or 'something newly introduced'. Let's be clear - there is no discrimination, appraisal or evaluation innate in the term. Something can be 'innovative' without being worthwhile, useful or better; it just needs to be different.


This is obvious when you think about it. We'd all be wearing nuclear-powered trousers and zipping around in personal hovercraft if the 'innovative' visions of the 1950s had come to pass. Those of us that work in the ICT field know that one man's innovation is another man's cupboard clutter. Most innovation is, in fact, useless or of such highly limited use it is not commercially successful; while the process of innovation is both wasteful and untidy.


It's an often quoted fact that 70% of innovators fail. The Harvard Business Review, for example, cites a variety of studies that show failure rates for new products across all industries of between 40 and 90%, with failure rates stubbornly unchanged in 25 years. The HBR says: "In the U.S. packaged goods industry, for instance, companies introduce 30,000 products every year, but 70% to 90% of them don’t stay on store shelves for more than 12 months."


I'd argue that failure rates quoted are still a huge underestimate of failure, as they don't take account of the innovation that doesn't make it out of the gate in the first place. You'll often hear people say that 99% of success is built on failure. I'd argue that 99% of innovation results in failure. It's the 1% of success, combined with the human drive to create, which fuels the innovation hype we are subjected to.


This is particularly dangerous in the ICT world. Every second word in our industry seems to be 'innovative'. Little technology is apparently not innovative. In fact, a lot of my working life is spent trying to gently explain to innovators that their equivalent of nuclear-powered trousers just doesn't have a market. A lot of the rest of it is spent trying to convince other innovators that while their new "back-scratching" device will never sell, with a little adaptation it could make one hell of a great rake and will have people queuing at the door. Both of these conversations are because most innovators don't understand their market.


Now, we could argue that innovators don't have to understand their potential customers and we can/should have 'innovation for innovation's sake' (just as some argue for 'education for education's sake'). I'd agree there might be some room for innovation that has no immediate application in itself, but later becomes the building block or inspiration for other useful innovations. However, I'd also argue that too much effort and resources are currently being lavished on innovation that leads nowhere. With resources being finite, and because we work in a commercial industry, we have to increase our 'hit rate' for successful innovation. To do so we need to be able to recognise and work towards more effective innovation.


I'd begin by banning the word 'innovation' altogether and instead talk about what it really is - a new product. Take the hype and the mystery out of it all, as well as the idea that things have to be complex or revolutionary or completely new to make them 'innovative'. To me, effective innovation is something that solves a problem or fulfils an unmet need. In a commercial environment we can extend that definition to be 'something that solves a problem or fulfils an unmet need for which someone is prepared to pay'.


In short, too much technology marketing, advice, awards and focus is on racing after 'innovation' instead of creating products customers need and want. The result, as I have said, is a very wasteful and untidy situation where customers have unmet needs they are prepared to pay for, while technologists are designing products that no-one actually wants. The one product in a thousand that - often by chance - does meet an unmet need, is used to justify the whole inefficient process.


To innovators I'd say:

  • concentrate on the potential customer, not the technology. Figure out what they want and need, and what they are prepared to pay for
  • keep it simple - don't make anything any more complicated than it absolutely needs to be, and strive to find ways of making it simpler
  • ban the words 'novel/new' and 'technology' from your vocabulary, as well as all-out hype words like 'revolutionary', and replace with 'effectiveness' and 'chargeability' (ie does it work and will they pay?)
  • remember 'new' doesn't mean 'better'. If it is better, then it also has to be better in a way that customers value and are prepared to pay for.

Omnisperience: experts in digital experience

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Hi Amit I couldn't have said it better myself - thanks for the comment. If only we in telco could get number 1 drilled into our brains more. You have no idea how many presentations I go to which are about customer experience or customer support and none of the slides have the customer on them. :-)

Teresa- for me one could do two things(atleast that's what I keep in mind whenever we get into we must INNOVATE kind of discussions :

1. Keep the customer at the centre of everything

2. and more importantly remind ourselves of what Peter Drucker said "There is nothing so useless as doing efficiently that which should not be done at all"

Thanks Amit - I think the problem is the confusion between "inspiration" which is that genius moment of invention and is a creative and somewhat chaotic event (and that's fine), and "innovation" which is for me a process that takes inspirations and turns them into deliverables.


This is where people trot out and frequently misquote Steve Jobs as justification: "well Steve Jobs said that people don't know what they want until they see it".


The problem is they fail to understand that Apple has always been highly customer-focused and always put a lot of effort into understanding customer behaviour, needs and wants - meeting them, and sometimes anticipating them, through close observation and thought. Steve Jobs was not, by any means, saying that you could or should ignore customers, he was just commenting that he didn't think focus groups worked. He was good at what he did simply because he understood effective innovation and was better at asking the right questions than others. But most of us are not Steve Jobs who had an internal ability to analyse, scrutinise and sift through things until he knew the product was right. Most innovators don't have all those skills embodied in one person - Steve Jobs is a rarity. And we often forget that Jobs had his failures too.


For me the question is how can mere mortals innovate more effectively? How can we improve the process to deliver 10 or 20% better results? What can we glean from success stories like Jobs so we can repeat more of the effective process and get better results?


         Another insightful article and as always a good read.  However, I strongly believe there is a place for  technology for technology sake as some of it does eventually lead to new products that are adopted. However, you are absolutely correct in stating that those looking to create something new need to concentrate on the potential customer to ensure success. 

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