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The Theory of Innovation

by Langdon on November 6, 2017

An interesting question to consider is if a theory is useful or useless.  Does theory make action more effective, or is it a needless diversion?

In the case of this blog post, the question is more specific:
Is a theory of innovation a useless abstraction, or an essential tool?

The exceptionally wise business innovator and philosopher W. Edwards Deming, who among his many accomplishments introduced the Japanese auto manufacturers to the concept and principles of quality, and who thus could be legitimately considered as the father of “lean” thinking and the profound breakthrough that is the Toyota Production System, had a distinct answer for this question.  In his view, without a theory to guide your actions, you have essentially “nothing.”  That is, you have no basis for considered decision making, no basis for systematic improvement, no basis for the advancement of knowledge.

In Dr. Deming’s view, theory is essential to sustained success, for theory provides the intellectual basis for learning, the accumulation of knowledge, and thus for progress.  After all, what do you have if you don’t have a theory that explains what has happened?  In this situation, you only have randomness, for there is no systematic underpinning to success or to failure.  Things just “happen,” for good or bad, better or worse.  There is no capacity to foresee outcomes, no basis for deciding between this and that.  Without theory there is only random, dumb luck.

Those distinctions make so much sense that they should settle the first question: yes, “theory” is essential, essential to knowledge, progress, science, business, and society.

What, then, would constitute a “theory of innovation”?

This question arose for us recently at the Fashion Institute of Technology, FIT, a dynamic college of about 9,000 students and an extraordinary and dedicated faculty located in the heart of New York’s Fashion District.  Since its founding in 1944 as a training school for, as you have certainly deduced, the fashion industry, the college has stretched and expanded and grown to encompass three undergraduate schools as well as a renowned graduate program.  Education at FIT is no longer follows a trade school model, but is quite broad and comprehensive.  Fashion is still a key focus, but now it is one among many, and even those pursuing fashion studies are also immersed in a wider curriculum.

With its roots in creative industry, the development of creative thinking remains a fundamental pursuit across the FIT curriculum, and when you walk through the halls or glance into the classrooms you will see students engaged in a huge variety of studies related to all of the design disciplines as well as business, liberal arts, and technology.  Sketch books, cameras, print makers, weavers, technologists, biologists, business modelers, poets, you’ll find all of them very hard at work, quite busily creating and learning.

What value, then, could a theory of “innovation” offer in this setting where creativity is an essential element?

At FIT, in fact, it matters a great deal.  One of the college’s three major strategic goals is the development and implementation of its own “strategy for innovation,” and as consultants, InnovationLabs was recently engaged (in the spring of 2017) to prepare this strategy, which proved to be great fun and a very rewarding project.  We interviewed, ran workshops for, and engaged in surveys with about 300 members of the FIT community to examine what precisely FIT’s strategy for innovation ought to be, and how best to implement it.  The resulting plan calls for initiatives across the FIT community, in the culture, the curriculum, the resources, and college’s broader community.

Now, in the fall of 2017, we’re continuing our work at FIT by taking the lead as Innovation Coordinator, essentially to begin implementing the plan.

So one of the first things that needed to be done was to communicate with the college as a whole what we mean by “innovation,” and how it might augment the creative activities that are already prevalent.  This is the theme of this blog post.

 

Creativity and Innovation

Hence, we must begin with some definitions, which will also provide the foundation for our theory.

>>  Creativity:  We define creativity as the realm of ideas, where expression is the essential quality.  Thus, the goal of the creative effort is to produce something which is new.  This need not be new to the world, but simply new to the creator.

>> Innovation: Innovation, however, is different.  This is the act of taking the fruit of the creative effort and transforming it into something deemed to be of value.  That value can take many different forms, among them aesthetic value, social value, and commercial value, but in some way there must be an understanding that value has resulted.  Certainly the determination that an idea has value, and has therefore transitioned to being innovation, is largely subjective, but as long as that determination is made then an innovation has come into existence.

Note, however, that the assessment of value is made not by the creator but by the user or consumer.  Hence, an innovation exists by definition only when someone other than the maker recognizes that value, and benefits from it.  That value may be aesthetic (and therefore highly subjective and possibly abstract), or commercial because someone buys your product.  It may also be betterment to society, as when innovations are implemented by government not for the purpose of making profit, but to improve a life in a city, for example.

We also know that creativity is the spark that inspires innovation, and thus innovation depends for its very existence on the creative act, even as we also know that the creative act is not “innovation” until someone else derives value from it.  Similarly, the experience of producing innovation stimulates further creativity, for this is indeed a self-reinforcing cycle.

This distinction between creativity and innovation is important to articulate not only in the college setting, but for business and government leaders, as they commonly confuse the two, which results in misdirected efforts and an unhelpful level of general confusion.

 

Multiple Meanings of “Innovation”

A further set of distinctions also needs to be made concerning innovation, as there are multiple ways that we use this word, which also creates confusion.  We need some theory, that is, to sort out these meanings, as bringing more precision to our language will support bringing more effectiveness to our efforts.

Thus, we use “innovation” as the name of a process, as in “we have an innovation process in our organization to manage our innovation projects.”

But we also use it as a noun, as when we say, “that’s a great innovation!”

And then we also use it as a descriptor, as when we say, “that product is very innovative.”

Hence, the same word appears in three contexts, but has similar although different meanings.  All three meanings are useful, but the overlaps do create confusion.  In common language, innovation is a process, a thing, and a quality of things.

 

Creativity and Learning

Now that we’ve considered the differences between creativity and learning, let’s now add a third concept, learning, to the discussion.  Learning, of course, is deeply embedded in both the creative process and the innovation process, and a fascinating set of relationships emerge here as well.

To begin, let’s consider creativity and learning.  Interestingly, when we think about what occurs in the brain when learning is occurring, we realize that it is an essentially creative process.  After all, neuroscientists tell us that when we learn, our brains are literally engaged in re-wiring themselves.  Learning is therefore actually the act of self-creation:  the brain before learning is different than the brain after, for the fact of having learned something means that the brain is literally wired differently after than before.At a physiological and literal level what has been created is the brain’s wiring; at the level of meaning, what’s different is knowledge, and thus the capacity to grasp, to understand, and/or to act.  Therefore, we can that learning is the process of self-creation, and that “learning is creation directly inwardly.”

Conversely, when we create something, it is by definition new to us (although it may not be new to the world).  And in this creative process we are therefore expressing our learning in an outward manifestation.

Do you see that the two processes are the same, but oriented in opposite directions?  Learning and creativity are reciprocal, as learning is creativity directed inwardly, while creativity is learning directed outwardly.

I find this relationship endlessly intriguing, and among the many insights that we can derive from these distinctions is the awareness that the relationship between creativity and learning means that we can get better at both, through practice.  We are not consigned to a world of a few creative people and “the rest of us,” for this tells us that we can all become exceptionally creative and also exceptional learners!  We merely need to apply ourselves to learning and creating.

In the language of neurophysiology, the brain is “plastic,” in that it is susceptible to being changed.  Notably the changes occur to the brain, by the brain itself, in response to stimuli!  The child development specialist might tell us that the human form is designed for learning, for that is perhaps what we do best.  It does explain, after all, why a creature of relatively mediocre physical attributes has come to dominate all life on our planet – we’re not the fastest, nor the strongest, nor the best sighted, nor the longest lived.  But we have come to predominance because we apparently out-learn the others.  (One but hopes that we can now learn whatever will be needed to assure our survival in this very complex age of globalized-technology-economy that we have created….)

Innovation and Learning

What about the relationship between innovation and learning? Here there is also a strong connection.  In the innovation process, the work we do is to address a world of unknowns.  After all, it’s called the work of “innovation” precisely because we don’t know for certain what we’re doing.  We have different words for what we do when we do know, for then we call it “engineering,” or “implementation,” for example.  But “innovation” and “research” are words we use when we are engaged in exploration and discovery, when we are embarked on a journey with a goal, but without yet a map to that goal. The process itself is the creation of the map.  The journey that results in an innovation is thus a journey to learn something new.

Hence, it is a time of ambiguity and uncertainty. As these are not qualities that endear themselves to those who are operationally minded, execution-oriented, or in pursuit of short term profitability, we now know why innovation is often so difficult to achieve in the modern corporate setting. In fact, the high degrees of ambiguity and uncertainty are rude turn-offs for the MBA mindset, and often innovation efforts get starved for cash because of it.

At root, this process of innovation attempts to resolve the uncertainty and ambiguity, to in fact create new knowledge, which brings new capability.  With the benefit of a completed innovation process, we have in hand an innovation artifact (thing), that enables us to know or do something that we could not know or do before.  Uncertainty is thus exchanged for knowledge.  Or, in other words, we have learned something new and useful.

So you see now that learning and innovation also have a reciprocal relationship:  the process of innovation is the act of learning; the act of learning leads us toward, or to, the existence of innovation, and is thus essential to the innovation process.

So now we have mapped innovation to creativity, creativity to learning, and learning back to innovation.

On our model of the three we must now add arrows that make it look messy, but also more accurate and complete.  And this diagram thus constitutes the foundation of our Theory of Innovation, whose purpose is to help us to be conceive of, strategically steer, and operationally manage innovation aspirations and efforts of all types, from the most short term and incremental in nature, all the way to the most ground-breaking and transformational.

The Next Layer

This brings us then into the next layer of our theory, for we can now proceed to examine how to apply the theory to achieve results.  This requires us to develop further distinctions, the first of which examines the differences between different types of innovation.  As implied in the previous paragraph, innovation with short term gains in mind must follow both a different process from and be guided by different structures and metrics than the pursuit of breakthrough and transformative innovation objectives.  In our work at InnovationLabs we distinguish between four different types of innovation, incremental at the short term extreme and breakthrough at the radical, with additional stops including the self-explanatory business model innovation, and new venture innovation, when existing firms create offspring to address specific markets or geographies.

To design and manage an effective innovation process we must therefore understand the types of creativity and learning that are required to attain each of these four objectives. Success at each of these four requires thoughtful construction of different processes and tools, and from this we then get still more deeply into the process of innovation.  There are at this level a great many technical tools that can be applied in pursuit of relevant learning, and in the management of those pursuits.

If you are experienced in the work of innovation then you will be familiar with some or many of these tools, such as the “stage gate approach,” “innovation portfolios,” “ethnographic research,” “agile innovation,” “design thinking,” and “high performing work teams.” All of them and many more come into play in the well-managed effort.  The intent here is not to delve into these in detail, which would in any case require multiple books, but rather to locate them in a useful theoretical framework.  Indeed, many of them have already been written, as a comprehensive innovation library probably encompasses probably hundreds of key volumes, and many contributing ones as well.

In summary, let us return now to Dr. Deming, with whom we started, and remind ourselves what he says about the use of theory.  He taught that knowledge comes from theory. To learn and to have knowledge, he explained, one must have a theory, because without theory one simply cannot make useful predictions about what could, might, or will happen. Theory, that is, is a prerequisite for both knowledge and for learning.

And so you see now why this is so relevant to our discussion about a theory of innovation, for learning is deeply embedded in all facets of the innovation endeavor, and if theory is a prerequisite for learning, then a theory of innovation is a prerequisite for learning how to innovate.

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We would be very interested in receiving your feedback on the concepts and indeed on the theory presented here.  Please feel free to contact us at LMorris@innovationlabs.com.

 

Suggested Readings

By Dr. Deming:   Deming, W. Edwards.  The New Economics.  MIT, 1993.

On the theory of knowledge:  Langdon Morris.  Managing the Evolving Corporation.  Wiley, 1995.

On the theory of innovation applied to innovation management:  Langdon Morris.  The Agile Innovation Master Plan.  FutureLab, 2016.

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The workshops are hosted by New Zealand’s own innovation agency, Callaghan Innovation, which successfully promotes and supports innovation for businesses at all stages of development, from start-ups to mature firms.

>> Remember Kodak, Blockbuster or Nokia? Attend this workshop with international innovation expert Langdon Morris and learn how to chart a successful future. It is a highly practical workshop for New Zealand businesses that want to survive the future. In an ever-changing and increasingly complex world it is mission critical to develop effective strategies for survival, growth and success. Learn how to use foresight and scenario planning to chart the future. Master methodologies and techniques that will allow you to map how the forces of change will interact to shape your future survival and success.

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