Here are a number of actual quotes from this week. On Monday, Mark and I had a research meeting with a colleague in the business school who does business process research. When Mark asked if she has ever looked at innovation, she said:

I haven’t, because innovation isn’t a process, is it?

After a bit of further discussion, we all agreed that it was, and that we could possibly do some productive work together.

Then I had a stimulating talk with Paul Hodgson, the Queensland Director of the Enterprise Connect program (a great initiative). We talked about the series of talks that I gave for the Australian Industry Group last month, where fewer than 2% of the people attending had systems in place to manage innovation. We concluded that this is an area that requires a lot of effort to improve.

Next I got an email from one of my industry contacts who is trying to implement a new innovation program in his organisation, which said:

Our CEO has basically thrown down the challenge: “Why would I want to introduce an innovation and ideas management framework in XXX – How would we benefit?”

This morning Mark told me about a talk he had with one of Australia’s most accomplished executives, who told him about a trip she made recently to Silicon Valley – this is how he summarised their talk:

She visited firms like Google, and Apple and Cisco, and she said that innovation was so deeply embedded in all of them that they never thought twice about it. They spend more time thinking about their place in the value network, and in building their innovation ecosystem. They are very aware of where their great ideas come from.

Finally, John and I talked about recent conversations that he has had with some people that are involved with innovation policies in government, and he said:

The guy’s mindset is from the 1970s – all he could think about when we talk about innovation is IP and commercialisation. Our challenge isn’t to educate the firms, it’s to get the message across to the people that are setting policy.

Conversations like these are both frustrating and exciting. They are frustrating because it would all be a lot easier if people understood what innovation is and how important it is – then we could concentrate on helping them get better at it. On the other hand, they are exciting because it shows how great the opportunity is if we can figure out how to communicate clearly about innovation. This is the message that we need to get out to everyone:

Innovation is the process of idea management.

It looks something like this:

There are three key components to it: idea generation, idea selection & implementation, and idea diffusion. They’re not really sequential either – they feed each other. You need to do all three well to innovate successfully. Central to all of it are people and processes. In particular, one process that we must have is integrating innovation into the organisation’s strategy.

As usual, it sounds very simple to explain it this way, but executing it is a bit harder. Nevertheless, there are several huge advantages to thinking about innovation in this way:

• Idea management is more than just having great ideas. One mistake that people make is to equate innovation with having a great idea. Innovation is not invention. That’s the mistake that our colleague made – fortunately, because she’s very smart, she quickly saw things from a new perspective.
• Thinking about the three steps makes it easier to see innovation as a process – which consequently makes it easier to manage. It’s impossible to manage “having a great idea”. It’s easier (but still challenging) to manage idea generation, idea selection and idea diffusion. Fortunately, there are tools and processes that help with all of these steps. Thinking about innovation in this way is the first step to learning how to manage it.
• It is useful to think about this process taking place within an innovation ecosystem. This gives you another thing to manage – your place in the value network. There are benefits to this though. It makes you realise that you don’t have to come up with all the great ideas yourself, and you also don’t have to spread them all yourself. It becomes much easier to think about collaboration when you see innovation as idea management.
• Seeing innovation as idea management is much more effective than seeing it as just commercialisation. In the commercialisation view, the only way to win is to have a great idea, protect the IP from it, and bring it to market. In the idea management view, you win by identifying and executing great ideas. They don’t have to be new products, the ideas can be for new ways of doing things, or for new business models. Those are all ideas. The innovation process needs to manage ideas – not just create new products.

Innovation is an essential part of economic progress. We can’t make things better without having new ideas. And having them isn’t enough – we also have to be able to execute them, and get them to spread. If we are going to successfully innovate, we need to think of innovation as a process. It might be a fuzzy process, but it is still something that we can manage. So think of it this way:

Innovation is the process of idea management.