Tim does a really nice talk on the invention of the computer and he has posted the slides on this blog. While he uses the story to discuss the difference between innovation and invention, I think there are a lot of other really interesting lessons here. Firstly, I’d like to add to Tim’s story by claiming that Hindus invented the technology that allows the modern computer to exist and then I’d like to make the observation that the fundamental difference between innovation and invention is connections.

So, what was the amazing technology developed in India nearly 2000 years ago? Quite simply, it was the number 0. Before this invention, there wasn’t a numerical way of describing nothing. It seems such a trivial idea, but it the basis for the digital economy. The first record of a 0 in use can be found in a temple in India where the inscription dates to 876 AD (the inscription below is the number 50).

The idea of 0 is an invention but it becomes an economically valuable invention (an innovation!) when it gets connected to other things. When we combine 0 with other numbers then we can start to develop some pretty powerful mathematics, which become more valuable when we connect them to systems of accounting and government. It isn’t surprising that the Moghuls were masters of empire building through careful accounting and measurement of every activity. Fibonacci brought the decimal number system to Italy at the beginning of the Renaissance , which set the Medici family on the path to greatness through the development of modern banking. Imagine trying to perform complex financial calculations with Roman numerals!

Finally, when we connect the humble 0 to 1 to develop binary code and then connect this to other inventions such as transistors and silicon chips, we get the computers and their applications that would have been unimaginable for the Indian mathematicians who invented the 0 in the first place.

The point is that valuable innovations come about through connecting things together so that there are new applications for things that already exist. It’s a bit like the conservation of matter principle. Matter can’t be created or destroyed but we can get new combinations of matter that are innovations.

I think what this means for firms is that they can’t think of managing innovation without thinking about managing connections. They are two sides of the same coin. Tim and I get to see many firms who have innovation management processes but few consciously think about the role of connections. One exception though is one of our research partners, Rio Tinto. They don’t describe themselves as being particularly innovative, although we can see many incremental innovations that have resulted from their community of practice program that tries to bring people together to match solutions to problems.

If we are getting serious about managing innovation then we need to start to understand the connections that are behind them. One way of doing this is through network analysis and we are currently looking at how network structures in firms influence innovation performance (there is a chapter by us on this subject in a recent book published by the Australian Business Foundation).