INNOVATION IN ENTREPRENEURSHIP
“It’s the introduction of novelty in a given market or industry, such as new products, services, methods, sources of supply or organisation,” says Fredrik. “At the same time, there’s a strong emphasis on successful commercialisation - that is, an innovation is more than an idea or an invention, it’s the result of taking it to market.” “The purpose of innovation is to continuously grow and renew an enterprise with new or better products, more efficient processes, or enhanced business models,” adds Walter. “The Innovationcourse of the Online MBA aims to answer the question - how do we, in business organisations or as entrepreneurs, get to successful innovation?”
It’s clear that innovation and entrepreneurship are closely linked; sometimes the terms are even used interchangeably. But, as two distinct yet interrelated concepts, it can be tricky to pinpoint the exact relationship between them.Fredrik recalls the 20th century economist Joseph Schumpeter, who said, “necessity may be the mother of invention, but it does not automatically produce innovation,” - hinting at a need for a third element. “Schumpeter suggested the entrepreneur represents the missing link between invention and innovation”, he explains. “Indeed, an entrepreneur is someone who is willing and able to transform an invention into an innovation.” Walter adds – “Turning invention into innovation relies on how an entrepreneur positions themselves, gets funding and manages their venture to become successful. Innovation is about the process and organisation needed to generate ideas in any context.” The ability to innovate in this sense isn’t just a vital component of a thriving business, but can be seen as an essential aspect of entrepreneurship itself.
While many have wondered whether or not innovation and entrepreneurship are skills that can be practiced and learned, our professors trust that they can. “While entrepreneurs ‘are born’ to a certain extent, research suggests that this only accounts for 40 per cent of entrepreneurial expertise”, says Fredrik. “The good news is that 60 per cent ‘are made’, meaning we can train these skills.” “Professional innovation management can be taught; it’s a set of processes and good practices like production or financial management”, adds Walter. However, he also believes that there are those more naturally inclined to entrepreneurship in particular. “Entrepreneurship has more to do with attitude, perseverance and focus. An entrepreneur can be a good innovator but an innovation manager is not necessarily a good entrepreneur.”
Many texts on innovation focus predominantly on large companies like Apple, but Walter is keen to point out that innovation exists within smaller, entrepreneurial businesses too. In the book he co-wrote with fellow innovation expert Philippe Silberzahn, The Balancing Act of Innovation, Walter explores some of the many ‘small jewel’ companies successfully innovating a niche for themselves in their markets, as well as how entrepreneurs can find and exploit their own innovation style. Walter explains in this video.
Whether a knack for innovation is instinctive or something that’s refined through practice and experience, one thing that’s always helped grease the wheels of entrepreneurial creativity is technology. “Technology has, throughout history, been a major source of discontinuity —displacing incumbents and replacing them with something faster, bigger and better,” notes Fredrik. Walter observes that today’s advancing tech, such as big data, IoT and machine learning, is now empowering whole networks of entrepreneurs to develop interconnected ideas. “Novel technology is and has always been a major source of innovation for entrepreneurs,” he says. “The distinguishing feature of new technology is that it enables open innovation in innovation ecosystems. Philips IoT-enabled light bulbs are now part of a platform that, next to giving light, provides opportunities for others to create software that controls it.” And what about the influence of digital channels? “It’s difficult to think of a business idea without any digital presence nowadays,” says Fredrik. “However, a digital strategy should always be based on solving a real job for the customer, not just used for its own sake.” “You can build a perfect entrepreneurial business without a clue about digital though,” argues Walter. “Then again, a lot of digital ideas come to market through strong entrepreneurs, and not because they’re digital.”
Whatever part technology plays in a business enterprise, nothing can substitute the fundamental knowledge and set of skills an entrepreneur will need to be successful. These may be innate and in need of honing, or something new that must be learned, but either way, our Online MBA can help you attain them.