What is Innovation?

01 February 2014

The world’s biggest and boldest firms prove that putting innovation at the heart of your business will reap rewards.

Sharpen up your cutting edge

What Is Innovation Knife

First there was the wheel, the light bulb and the steam engine. Now we have Twitter, the iPhone and self-driving cars. The nature of innovation in the 21st century may have changed, but it remains critical to economic and business advancement (admittedly sometimes sideways – think self-sorting socks or ‘Smell-o-Vision’).

Increasingly, innovation is also expected and highly valued by customers and investors alike – as the likes of Apple and Google know only too well. Having brought the world innovations like iTunes, the iPhone and the iPad, Apple has faced some criticism for taking too long to release new products and is now under pressure to produce ‘the next big thing’, with an Apple TV tipped to be on the cards.

“Everybody in our company is responsible for being innovative, whether they’re doing operational work or product work or customer service work,” Apple Chief Executive Tim Cook explained in a recent interview with Businessweek. While Apple seems to eschew the need for an ‘innovation department’, Google’s secretive ‘X Lab’ facility – rumoured to be somewhere in the Bay Area of Northern California – is reportedly working on a list of 100 future technology projects including a space elevator, self-driving car and augmented reality glasses.

Susan Wojcicki, Google’s Senior Vice President of Advertising, says nurturing a culture that allows for innovation has been key to Google’s sustained momentum. “As we’ve grown to over 26,000 employees in more than 60 offices, we’ve worked hard to maintain the unique spirit that characterised Google way back when I joined as employee #16,” Wojcicki says in a Google blog. “At that time I was Head of Marketing (a group of one), and over the past decade I’ve been lucky enough to work on a wide range of products. Some were big wins, others weren’t. What’s different is that, even as we dream up what’s next, we face the classic innovator’s dilemma: should we invest in brand-new products, or should we improve existing ones? We believe in doing both, and learning while we do it.”

Everybody in our company is responsible for being innovative, whether they’re doing operational work or product work or customer service work.

Knife Left

What is Innovation?

In its simplest terms innovation is doing something differently to create new or better products, services and processes. For society at large it tends to mean more comfort and convenience. For businesses it drives efficiency, productivity and growth.

Sir Richard Branson, a godfather of invention since the age of nine – when he cut his teeth breeding budgerigars and growing Christmas trees – says Virgin Group drives a culture of innovation by encouraging an ‘anything is possible’ mentality.

“At Virgin there really is no such thing as a silly idea – at least not until such time as we’ve poked it around and proved it to be unworkable,” he says in his recent book Screw Business as Usual. “I want all our people to be entrepreneurial, to work under their own initiative and to realise that if something isn’t happening, then they have to make it happen. ‘Screw it, let’s do it’ doesn’t just apply to me; I want our people to feel the same way, too.”

Another master of innovation is online retailer Amazon. A key focus is driving environmental efficiency, and the group has a Kaizen programme (Japanese for ‘change for the better’) dedicated to this. It involves Amazonians at all levels diving deep into ‘every nook and cranny of a process’ to identify waste and design alternative solutions.

One example is its fulfilment centre at Hebron, Kentucky, where staff found a way to fit 20% more containers into each truck by simply reconfiguring how they were loaded. This has saved the company more than $3 million in transportation costs and 300,000+ gallons of fuel a year.

Amazon Chief Executive and founder Jeff Bezos says innovators have to be willing to fail and to be misunderstood. Speaking at the company’s re: Invent developer conference last year, he cautioned: “If you never want to be criticised, for goodness’ sake, don’t do anything new!”