Constructing innovation

Exploring paths to innovation from too simple theoretical perspective.

Ideas, insight, business and technology will be the four elements which I use to construct paths to innovation in this article.

Legond: White = Ideas, Yellow = Insight, Blue = Business, Red = Technology

Definitions

Ideas offer a new view on the issues located in The World.

Insight here refers as insight on humans and meanings. Understanding their world by being part of it, knowing tacitly or then objectively empathizing with them, and being capable of explicitly expressing the findings.

Business refers to revenue model and other social actions needed to keep value production viable by transferring resources from customers to producers — from people who gain value to people who enable it.

Technology is the rest of the human knowledge, enabling automation and multiplication of human efforts.

Axioms

The situation where a new innovator enters as a default is The World. It consist of three living elements and accumulation of past knowledge:

  1. Peoples lives, meanings and ideas
  2. Existing businesses, mechanisms that create value and transfer resources
  3. “Free roaming technology” that has not been utilised in full
  4. (History of tried and failed)

These elements serve as sources of innovation. The innovation might start from any of these droplets:

Business ideas (blue+white) have a model for creating value and they also view the world differently than others in The World. Just a copied business model (blue) does not count as innovation, but might count as highly profitable business. Competition happens when there is a slightly better idea (white) or technology (red) behind the business. Looking at existing businesses, collecting a set of cases like in management consulting, comparing business models — doing research on existing business might result in new business model ideas.

Human insight driven ideas (white+yellow) are what most of the ideas are. Inspired by past and present humans and ideas a new idea might emerge. Most of these are counted as culture. Instead of a business they might take a form of a book or an internet meme. If the insight and idea is adaptable to business it might evolve into an innovation. Peoples lives and meanings remain as the most fruitful source of innovation — we have just not learned to utilise it enough, is my opinion.

Ideas (white) without any evidence are mere hypothesis of The World.

Business model with technology (blue+red) still counts as an innovation. It combines a copied business model (blue, not an innovation anymore) with a new or better “free roaming” technology. It will enable the business model to be more effective.

Ideas for technology (white+red) might emerge by seeing potential combinations of “free roaming” technology. It might make the technology more “complete” by reducing some technological limitations with another. After that step the combination might offer a new type of value to humans.

Small business (white+blue+yellow) exists and can be created in The World, but they dont’t have the technology to scale up.

Thesis

Each of the 6 droplets can result in an innovation. But not all innovations are the same. Without path dependency, there are three types of innovations holistic innovation, innovative technology and scaled technology.

What unites all of them is the requirement for technology and business elements. They are the core of the innovation. These are also something that is emphasised in education. Business and technology graduates are taught into making innovations. It seems almost that business and technology are already over emphasised. There is a real struggle for these professionals to find meaningful problems to innovate in.

Scaled technology (blue+red) offers a good business. Combining databases and mechanical breakthroughs in a novel way may improve the effectiveness of human kind. Nothing is learned from the world, but the same is done more efficiently. Basis for all engineering.

Innovative technology (white+blue+red) offers a new business model utilising technology in an unprecedented manner. The world is presented with a meaningless new way of producing value and collecting resources. Basis for all business.

Holistic innovation (white+blue+yellow+red) adds meaning defined by socially constructed reality. The key ingredient is the human insight — ability to understand and construct meaningful living experiences to other human beings. The value that the innovation is facilitating adds more meaning to the lives of human beings. The meaning is something surpassing mere utility value. Value can be as simple as providing necessities or reducing anxiety. Meaning is an end to itself. Reason to live.

Paths to three types of innovation

Requiring innovators to come up with more reasons to live is a lot to ask. However it becomes much easier if the people are studied and humans are observed. Some new perspectives are bound to come up if customer base is engaged or their culture is studied and analysed.

In these situations it might be that the technology to scale work efforts is quite trivial in todays standards or there exists a business model already for the production viability purpose. I argue that a lot of potential remains just underneath a study and analysis of humans. Task suited for people taught on studying humans (anthropologists, sociologist etc.).

Paths to innovation

With path dependancies each of the 6 droplets are different when it comes to testing if an innovation can come out of them.

Business ideas (blue+white) requires technology (red) to scale and as argued above, it should utilise insights from people if it wishes to become a holistic innovation and offer meaning and become meaningful part of human life.

Human insight driven ideas (white+yellow) require business model (blue) for viable value production, to make it profitable small business, and technology (red) to make it scale.

Ideas (white) require the most work. If there is nothing to support an idea, it is triple work to add business model (blue), scaling technology (red) and meaning adding (yellow). Ideas should be cultivated in a pool of technology, business or insight before proceeding.

Business model with technology (blue+red) has the potential to become holistic, innovative or only scaled. Adding new perspective (white) it becomes innovative technology. Adding insight into what that technology could offer to people (yellow) might make it holistic innovation. The most lucrative path is only to scale the technology, make it more profitable and be done with it.

Ideas for technology (white+red) might be interesting in closed problem space in itself. Adding efficiency to old technology or developing new technology is good basic research. Commercialisation requires a business model (blue) and customers. If the technology revolutionises the customers life (yellow) it will become a holistic innovation in itself. A lot of technology is a stack of previous technologies. Anybody has just not invented a game changing use of them.

Small business (white+blue+yellow) can become scale-ups if a right kind of technological solution exists or is invented (red). It might result in radical changes in the meaning creation and revenue models.

Lucrative copying business

Holistic innovation ripoff (blue+red+yellow), or incremental “innovation” must be the most lucrative area to be in. With minimum ideating effort it is possible to quickly find spots that are closer to local maxims, thus beating the original implementation of the innovation. In short term that is where the maximal returns are for revenue. Competition in open market are only hindered in some cases by natural monopolies and intellectual property regulations. Usually monopolies found by innovation are quickly filled with competitors.

Ideas are copied fastest. Technology is copied relatively fast, as is also the business model. Meanings might be culturally specific, but they are also dynamic. As competition enters the culture groundings for the innovation might alter. Patents might be available, but keeping competitors at bay might require fast iterations and movement after the initial innovation.

The basic handbook for business includes also other non-innovative methods as scaling of business with technology and commercialisation of meaningful technology

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Aarne Leinonen

Radical existentialist with a humanistic vibe. Researcher of service development in organizations. Interested in customer value. Tweets @aarneleinonen