Thursday, August 27, 2009

How Would You Define an Innovation System?

There were five questions I posed in my blog of July 6, 2009 about innovation systems:

1. Why did you begin working with innovation systems?
2. How would you define an innovation system?
3. What is your favorite aspect /concept of innovation systems?
4. In your opinion, what is the most problematic aspect/concept of innovation systems?
5. How do you see the future of innovation systems?

I answered the first question then. Now I’m going to answer the second question.

I of course didn’t think about it at the time but question number two – How would you define an innovation system? – combines two very widely used words, innovation and system, that are poorly understood. As I related in the first response, I’ve been working on innovation for most of my life, and I’ve collected many different definitions of innovation. In my experience, just about everyone has slightly different definitions of the two terms.

So, how do you define the combination of two of the most widely used and misunderstood terms? I chose to go back to the Indo-European roots of the two words. The Proto Indo-European language is the source of many languages in Europe. English comes from the Germanic branch of the language.

The Indo-European root word for the central concept in innovation – nova – is “neuos”, which meant new and now. “Neus” captures the concept that every instant is different. The now of the present instant is different than the now of the past instant. Change has occurred. It’s new. Heraclitus captured this idea in his quote, “You can never step into the same river twice.” As long as we live, we exist in a stream of external and internal change.

Or, “Time is the greatest innovator,” as Francis Bacon put it.

This profound duality was split in Latin into “nunc”, or now, and “nova”, or new. The phrase, “nunc dimittis” was asking for permission to leave now. “Nova” was short for “stella nova”, a new star that busts upon the sight. But even in these two concepts, an implied duality remains. For “nunc” first originated as “quidnunc”, an exclamation, “What now!” And, “nova” implied, a new thing now.

The first part of the word innovation, “in” is derived from the Indo-European word “en”. “En” meant in, within or into. So, literally, a “nova’ inside or within.

Since “nova” is a noun, new/now, we probably first changed it into a verb by adding the suffix, “te”, to create innovate, and then added the suffix “tion” to create a noun. When we did that, we added some confusion because the suffix “tion” can mean three different things - the act of innovating, the state of being innovated and, the thing that is innovated.

I think I’d be happier if we had just stuck with innova (n), innovate (v), innovative (adj), and innovatively (adv).

“System” derives from a very rich Indo-European source, “sta”, which meant to stand or stay. Hundreds of English words are derived from this source. (Even the word I used in the discussion of innovation, instant.) System came through the Greek “histanai”, to cause to stand. When combined with the Greek prefix “sun”, which meant with, the word became “sunistanai”, to place or set together. This became “sustema”, a number of things placed together. It was changed to “systema” in Latin, and finally “system” in English. Again, you have a type of duality present. A system is a number of things that stand/stay together. “Sta” came through German to become “gestalt”. Gestalt is a German word for form or shape. It is used in English to refer to a concept of wholeness. The concept of wholeness has an important role in a system. Godel, the German mathematician, proved that any closed system (of language, mathematics, thought, physics) always has residual error. The fact that we put a boundary around a system will always result in error. Our journey of knowledge is always to include more elements into the systems we consider.

An innovation system is a collection of things that stand/stay together and act resulting in something that is new/now.

An innovation system is a collection of things that stand/stay together and act resulting in something that is new/now. In this case, I am using the first definition of “tion”, the act of innovating. So, more correctly, what I’m defining is a system of innovating.

I believe that there are six different types of systems of innovating:

• Emergent
• Discovery
• Design
• Invention
• Adaption
• Adoption

Innovation, in the third definition “tion”, is the thing that is the result of innovating. In this sense, an innovation system is a collection of results of different acts of innovating that stand/stay together. Together they constitute a whole, or gestalt, so unified as a whole that it cannot be described merely as a sum of its parts.

An innovation system has two different parts and each part has three different types:

Nature – what is being innovated*

o Product – the result of changing nonliving entities or how they interact
o Procedure – the result of changing how living entities interact
o Process – the result of changing how living and nonliving entities interact

Class – how big the change is from the past; a measure of progress

o Incremental – the result of a small change; an augmentation of a distinctive or breakthrough innovation. A small advance in progress.
o Distinctive – the result of a moderate change in a breakthrough innovation. It enables a flow of incremental innovations. It is distinctive in the sense that it clearly belongs to the class created by the breakthrough but different. Usually results in a significant advance in progress.
o Breakthrough – the result of change that removes or bypasses a barrier to or a plateau of progress. It permits a hierarchy of distinctive and incremental innovations. Usually results initially in a decrease in progress with the potential of a very large advance in progress in the future.

Progress is usually made up of a series of overlapping s-curves. Breakthrough innovations occur in the gaps between the s-curves. Incremental innovations usually occur in the front and end of the s-curve, in the flatter portions of the curve, but can occur anywhere along the s-curve. Distinctive innovations usually occur as part of the middle portion of the s-curve where the most rapid progress is made.

The class of innovation can also be thought of as a cascade, or tree.

Service innovations are usually a mixture of process and procedure innovations. Disruptive innovations don’t have to be breakthroughs. They can result from a pattern of innovations.

Combining the nature and class of innovation together in a matrix results in an innovation system that encompasses a wide variety of individual innovations. However, it is the specific innovation system, unique to an enterprise, consisting of a pattern of innovation, that can exceed the sum of its parts generating economic value (or social good), comparative advantage and meet or even exceed customer expectations.

*Note: I recognize that these definitions need to be modified when the innovation concerns new life forms.

More to come later.

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