Confusion about Innovation & Creativity? Try this

posted by Ravi Arora August 13, 2016

Reasons for confusion:

Innovation has newness and it generates value. Creativity results in newness and many times generates immediate value. Most innovation consultants and trainers I have met, heard and seen are creativity experts and help companies in generating ideas using creativity tools and techniques.

The above makes most managers conclude that for innovations to happen one needs to focus only on creativity. Over a period of time the difference between the two have blurred and are used interchangeably.

While ideas are the starting point for innovations, the journey after generating ideas is much longer and tougher. It is important for managers to differentiate the two and avoid the sole focus on creativity while driving innovations.

I don’t agree with Theodore Levitt’s definition in which he said, “Creativity is thinking up new things. Innovation is doing new things.”

Innovation is much beyond creativity:

New ideas trigger innovations. Creativity is needed to generate new ideas. Hence every innovation begins with some creative thinking. Ideas don’t have any immediate commercial value. They need to be worked upon for months and years to turn them into reality. Ideas encapsulate value only after they are successfully implemented and that is when they are called as innovations.

Is innovation the only way to capture value from creativity? Not at all! If creativity itself didn’t have a commercial value, then there wouldn’t have been confusion between the two.

Creativity also generates immediate value!

Manifestation of creativity could be in any form. If the manifestation is an idea that we discussed above, it has negligible (commercial) value. But there are other manifestations that have immediate commercial value (aka ‘creative piece’) after the manifestation. Painters, writers, music composers, sculptors are examples of people who use creativity to produce their output. These manifestations (painting, book, music etc) have commercial value as soon as they are completed. All these people are surely creative but not necessarily innovative.

Such creative manifestations are accomplished not only by mere thinking but needs effort in converting thoughts into something (painting, music etc,) that could be consumed (used, enjoyed, and appreciated) by others. These outcomes usually fulfill the inner needs of people who value them. The fact that such manifestations need effort much beyond thinking makes me to disagree with Levitt’s definition (‘Creativity is thinking’).

Creativity is an individual trait but could be enhanced by the presence of other people and also by using tools and techniques. On the other hand, one can innovate without being creative as the innovator can use the ideas of others.

To declare something as innovative, one has to find if it is actually novel (Innovation is ‘novel outcomes that generate value’). Value generated from an innovation largely depends on its (perceived) Novelty. On the other hand, the value generated from creative outcomes (ideas, music, painting etc) is largely subjective.

Creativity Innovation
Process Dominantly thinking, imagining followed by Doing Dominantly doing to convert the idea into reality
Measurement Subjective Objective
Risky Mostly No Yes
Investment Mostly Individual’s or team’s time Collective time and money

To summarize,

  • If creativity results in an idea that has negligible commercial value but needs effort and investment to encapsulate value, it is likely to be an innovation.
  • If creativity results in something that encapsulates value immediately on its manifestation and needs negligible efforts to capture this value, it is not an innovation

When it comes to understanding and comprehending innovation, there are two other confusion that managers often come across:

  • Difference between Innovation and Invention: This is easy to answer (I like the simple one – Invention consumes cash and innovation generates cash)
  • Difference between Innovation and improvement: This is comparatively difficult and there cannot be one method which could resolve this for all types of innovation. We can create guidelines at a company level to resolve this.