Innovating Innovation

When I was reading Henry W. Chesbrough's book on "Open Innovation", the foreword by John Seely Brown, former Director of Xerox PARC, about "Innovating Innovation"  grabbed my attention.

Here's an excerpt:

[...] Some more definitions: by innovation I mean something quite different from invention. Innovation to me means invention implemented and taken to market. And beyond innovation lies “disruptive innovation.” By this I mean something that actually changes social practices — the way we live, work and learn. Really substantive innovation — the telephone, the copier, the automobile, the personal computer or the Internet — is quite disruptive, drastically altering social practices.

Disruptive innovation presents some major challenges. First, although it may be relatively easy to predict the potential capabilities of a technological breakthrough in terms of the products it enables, it is nearly impossible to predict the way that these products or offerings will shape social practices. The surprising rise of email is but one example. It is not technology per se that matters, but technology-in-use, and that is what is so hard to predict ahead of time. Nevertheless, technological breakthroughs that do end up shaping our social practices can produce huge payoffs, both to the innovator and to society.

A second major challenge is that a successful innovation often demands an innovative business model at least as much as it involves an innovative product offering. This is a hard lesson for research departments of large corporations to learn. It is why so many great sounding innovations in the research lab fail to see the light of day. In the lab, we have devised many ways to rapid prototype an idea, explore its capabilities and even test lead customers' reactions to it. But innovations that intrigue the customer don’t necessarily support serious business models — as the dot.com boom and bust showed again and again — and even those that do may support a model that threatens to cannibalize the sponsoring corporation's existing business models. So, as one aspect of innovating innovation, we need to find ways to experiment not only with the product innovation itself, but also with novel business models. Rapid business model prototyping is thus of critical importance to the future of technological innovation, [...]

There are additional reasons to innovate innovation. Most prior models turned on the creativity within the firm. In today’s world we are faced with two new realities. The first is that there are now powerful ways to reach beyond the conventional boundaries of the firm and tap the ideas of customers and users. Indeed, the networked world allows us essentially to bring customers into the lab as co-producers. [...]

The second reality has to do with the fact that today most of the world’s really smart people aren’t members of any single team but are distributed all over the place in multiple institutions. Similarly, we are now looking for innovations in the interstices between different disciplines — between, for example, biotech and nano technologies. Any new model of innovation must find ways to leverage the disparate knowledge assets of people who see the world quite differently and use tools and methods foreign to ourselves. Such people are likely to work both in different disciplines and in different institutions. Finding successful ways to work with them will lie at the heart of innovating innovation.

New technology offers us new tools to help in this meta type of innovation. ...

[...] 

The open innovation model that Chesbrough describes in this book shows the necessity of both letting ideas flow out of the corporation in order to find better sites for their monetization and also to flow into the corporation as new offerings and new business models. [...] An open innovation model diminishes both the error of squelching a winner (a false negative) and of backing a loser (a false positive). [...] Let us, instead, all engage in the process of innovating innovation. [...] "