What Is Innovation?

Answer:
Innovation refers to a new way of doing things.

This may refer to incremental and completely radical or revolutionary changes in thinking, processes, products, or organizations. Since 1934, scholars have begun to distinguish between an invention, or an idea that has been produced, and an innovation, or news ideas applied in practice.

In most fields, something has to be substantially different in order to be called an innovation. Small changes would not apply. The goal of innovation is to create a positive change, or to make something or someone better. Innovation that leads to increased productivity in the main source for increasing wealth in an economy.

Innovation is common when referring to the subjects of economics, business, design, technology, sociology, and engineering. Innovation typically refers to the output of the process. Economists usually focus on the process, from the creation of an idea through its transformation into something useful and its implementation. Innovation is also a major driver of the economy due to its increasing productivity, and as such, the factors that lead to innovation are very important to policy makers. Followers of innovation economics focus on using public policy in order to lead to innovation and growth. Those who are responsible for innovation are usually referred to as pioneers in their field.

In an organization, innovation can be tied to performance and growth through improvement in efficiency, productivity, quality, competitive position, market share, etc. There is no organization that cannot innovate to some degree. Innovation usually adds value, but it can also have a negative or destructive effect as these new developments change old organizational forms and practices. Companies that fail to innovate are often destroyed by those that do. However, innovation is not without risk. The main challenge to innovation is in maintaining a balance between process and product innovations in order to build shareholder satisfaction through improved efficiencies while innovation build customer support at the risk of expensive research and development.

In its most basic form, innovation is the result of time and effort into researching and idea, a larger amount of time and effort into developing the idea, and a large amount of time into commercializing the idea into a market with customers.