1/ Why is it critical that entrepreneurs and all businesses innovate? What are t

Question

1/ Why is it critical that entrepreneurs and all businesses innovate? What are the reasons that make it difficult for enterprises to simply stand still and accept the status quo? Note that these are not puny little notions. The reasons are based on large-scale changes in the economy and “macro” changes in the business environment.

2/ Why does your author stress “Successful innovation” and not just innovation for the sake of “newness”?

3/ There are two major types of innovation discussed in your text. Name them accurately and be able to identify their key differences

Explanation / Answer

1/ Why is it critical that entrepreneurs and all businesses innovate? What are the reasons that make it difficult for enterprises to simply stand still and accept the status quo? Note that these are not puny little notions. The reasons are based on large-scale changes in the economy and “macro” changes in the business environment.

It's absolutely critical that leaders understand this: An innovation has no value until an ambitious entrepreneur builds a business model around it and turns it into a product or service that customers will buy. If you can't turn an innovative idea into something that creates a customer, it's worthless.

But first, a quick but important distinction between innovators and entrepreneurs. An innovator is first and foremost a creator, a problem solver with a deep passion for improving something. Innovators are thinkers. But an entrepreneur is driven to act, to build. This includes building the businesses that make and sell the things that innovators think up, because entrepreneurs are doers.

Of course we need innovators. And we need tons of their ideas and innovations. But we need to ask the right question about every single one of those ideas: "Can we sell it?" Every time an inventor has a new idea, we should ask, "Exactly who is the customer?" "What miracle does it provide the customer?" "What is the business model?" "How many customers will love this?"

Putting tens of billions more dollars into innovation is like stacking a woodpile higher and higher with no matches to strike the fire. That is the current strategy of virtually all American leaders, national and local -- just piling the stack of valueless innovation higher and higher. We mean well, but it isn't getting us where we think it will.

Thought leaders often ask me: Aren't innovation and entrepreneurship like the chicken and the egg? Which really comes first? My answer is: That's the wrong analogy. The right one is the cart and the horse. Entrepreneurship is the horse, and innovation is the cart. In putting innovation ahead of entrepreneurship, our thinking has been dangerously off. It doesn't matter how brilliant the innovative idea is if there's no one to create a business that sells it.

Because America's core economic premise is based on new ideas rather than on new businesses, the country just keeps loading the cart with more and more innovation. What the U.S. needs instead is a team of horses to pull the best ideas into the marketplace.

Almost no one in Washington understands this. Innovation, discovery, breakthroughs, ideas and creativity are valuable and necessary -- we can't get enough of them. But they create little to no economic energy in and of themselves until an almighty customer appears. The car, the light bulb, flight, the transistor and the Internet created little to no economic energy until each invention was successfully commercialized -- until customers appeared.

So our real problem is not that there isn't enough innovation. It's that there aren't enough entrepreneurs starting new businesses.

2/ Why does your author stress “Successful innovation” and not just innovation for the sake of “newness”?

In the context of innovation, I believe it is the role and responsibility of leaders to create the environment where people can first and foremost be themselves. If they are allowed to be themselves they will feel free to express themselves, be creative and to contribute to innovation. It people feel they can be themselves they feel accepted for who they are and don’t have to try to be someone else. For people to share their ideas, especially if they are crazy, they need to feel safe. Has not Einstein said, “If at first, the idea is not absurd, then there is no hope for it?” A leader has to create an atmosphere where people feel safe and are not worried about feeling silly, being ridiculed, or undermining their professional standing through suggesting crazy solutions and ideas.

It depends on how we define leaders. Some leaders achieve a lot of innovation that is not necessarily good or positive.

Leaders have to provide the context and some guidelines on where to go. It is also the leaders who determine what is acceptable and what is not acceptable in an organisation. If, for example, the leader thinks it is acceptable to bribe, then their followers would see nothing wrong with bribing others too. If, however, the leader makes it clear that certain behaviours are intolerable and that people displaying these behaviours will be fired, then people are much less likely to do so. So it is also the role of the leader as a role model, to model the kind of behaviour that he or she would like to see.

This is often the biggest challenge: Leaders who stand up and say we need innovation but whose behaviour does not reflect that. If someone comes up with a crazy idea, requests a little for time to explore or would like to pull a team together, just to be rejected is a sure way to kill innovation. Excuses like, “We haven’t got time for that,” or “We don’t have the resources,” just do not support innovation. Innovation leaders should not only provide direction for those whom they expect to innovate, but also create an environment and provide the resources to enable innovation to happen.

To come back to Rob Goffee’s definition, when he talks about inspiring others to higher levels of performance performance here is definitely not only linked to economic improvement, but much more so to what people believe they can and cannot do, including being creative, engage in innovation, and embrace change. The willingness to take risks, for example, implies doing things that they might not consider themselves capable of otherwise. Great leaders are able to bring out the best in others in all senses—their ability, their selfworth, and what the individual can achieve in life.

It reminds me of what I call the Five A’s of Innovation:

I think there is a danger in putting one school of thought ahead of others, as we often seem to do. We need leaders who can hold it all together—the views of the psychologist, the engineer, and the marketer, that is. Such leaders would be able to understand all these different perspectives.

At the same time, I believe it would be a mistake to try to make everybody the same. We need those with deep levels of expertise, and we need those who can communicate across communities. The emphasis should not be on trying to get everybody to the same level, but rather to create a context where each can contribute according to their area of expertise, and is appreciated and respected for that. Innovation leaders need to ask, “What do we do and what can we do to make or help those with different values and mind-sets work together better? How do we enable them to come together (because it does not come naturally)?” If the values and mind-sets of those whom we expect to collaborate are very different—for example, scientists and marketers—there is normally a struggle to work together successfully and in a way that truly brings together their different areas of expertise that results in something new and exciting, rather than something that reflects the lowest common denominator.

3/ There are two major types of innovation discussed in your text. Name them accurately and be able to identify their key differences

In it's simplest form, there are three main types of innovation: 1) pioneering innovation, 2) best practice innovation, and 3) technological innovation.

1. Pioneering Innovation

Pioneering innovation is often the method most associated with the term innovation. Pioneering innovation occurs when a brand new product, service, or way of doing something is introduced into the market. This method, however, is the rarest form of innovation as most products or services have already been introduced into the market in one form or another. While not every industry may have utilized each innovation, it is very rare that a new product, service, or way of doing something is completely original.

2. Best Practice Innovation

When a business or industry innovates, meaning that they do something they have not done before, they are often utilizing a method, product, or service that has been used by industries outside of their competition circles. This process of restructuring a business from the inside by utilizing industry bench marks or other-industry best practices is called best practice innovation. Best practice innovation is the most common form of innovation for businesses today.

3. Technological Innovation

The final form of innovation is technological innovation. This type of innovation occurs when an existing form of technology is introduced into or used in a new way. While this type of innovation has some overlap with best practice innovation, I believe that it is important to separate technology from other forms of innovation for two main reasons. First, technology is changing so quickly, that the introduction of a new technology into a business or industry that has not experienced this technology before can completely transform the industry or business. On the other hand, however, a technology innovation can also be a short term competitive advantage as technologies continue to evolve and competitors continue to adopt emerging technologies.

Related Questions

Navigate

• Browse (All)
• Browse 1
• Subjects

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.