Innovation Equation

We wanted to start off the book by clarifying what we mean by producing innovation in the context of an organization. The Innovation Equation is a way of making the distinction between products and services that are new without necessarily being innovative. We’ve used examples that seemed fresh to us in 2007, but by now may be a bit dated—the iPod has been eclipsed by the iPhone as a go-to model of innovation, and perhaps it’s overexposed as well. And while the :CueCat may be memorable for people who were active in technology in the 1990s, others haven’t heard of it at all.

By starting to define the complimentary activities required to produce innovation, we hoped to make it a little less daunting. Did it work? We’d love to hear your thoughts.

What seems to be working

  • We believe the Innovation Equation (vision + invention = innovation) is a useful way to begin framing the discussion by outlining the complimentary activities which are required to innovate.
  • The Innovation Equation also explains that innovation is both harder and easier than you might have thought. Is that coming through in the final pages of the chapter?

Areas that need work and feedback

  • We have been thinking it would good to introduce a bit on how “purpose” drives an organization. We have ideas for what content might work well, but what would you include?
  • We definitely need more up-to-date examples than the ones we wrote about in 2007! What would you suggest—for Poor Vision and Invention, good Vision, good Invention, and Successful Vision+Invention?
After you’ve read the chapter, please post your thoughts, constructive critique, and suggestions below. If you’ve already done so, take a look at Chapter 2–Balanced Breakthroughs–where we outline how converging trends in People, Technology and Business enable or constrain innovation.
  • Dean

    Hi Zach, really enjoying your opinions on innovation, which are very much aligned with those we espouse at

    I believe you are right in your assertion that ‘innovation is not rocket science’, it sure doesn’t have to be complex. That said, innovation remains a difficult thing for many organisations to deliver, but as you so rightly point out, deliver they must if they are to stand any chance of capturing the imagination of consumers willing to participate in any kind of exchange (we’ve been writing a series of posts about this ahead of an event we are hosting later this month

    So what makes it hard? I believe your neat innovation equation points to the fact that invention alone does not innovation make. Ideas are cheap and organisations generally have a surplus. A vision is most definitely required to give any new invention a sporting chance of getting off the ground, but will vision be enough to ensure take off? I believe there is another element required, one that is possibly missing from your equation (or maybe needs bringing out more explicitly) and it is something akin to commitment and/or resilience.

    Vision provides the basis for commitment. It is your flag in the ground. It is the destination you are aiming to reach coupled with the plan for getting there. It’s were your journey starts. But a commitment to action is required to get airborne. In addition, those setting out on the journey have to be prepared to hit some turbulence along the way and not panic and reach for the parachutes when they do (helped with reassurance from a confident and experience flight crew). Am I stretching the whole flight metaphor a little now? :-) I know you start to grapple with some of this in further chapters so I’ll go on to something else…

    With regard to exisiting examples I’d like to pick up on the Ipod example. I think this remains a great case study and I wonder if there is another way to build on it. I think you mention in another chapter how the iPod chimed in a post Napster world, and this reminded me of a quote from Henry Jenkins, “…we can understand the future if we understand what people are doing when it’s hard”. I believe he talks primarily about early media piracy as an indicator of the ‘on demand’ world that we now inhabit.

    I’ve been thinking about this quite a bit recently and think it is interesting that: once upon a time it was hard to digitise your analogue music collection but we did it anyway because it allowed us to do things that we perceived as valuable e.g. make playlists, back-up, share and randomise playback of entire music collections etc. Then Napster comes along and all of a sudden it’s easier to to download a piece of music in the required format than to rip it (or purchase it). Then Apple makes the whole thing legitimate (i would assert that it was the convinience of Napster that was more important than just getting things for free) and portable in a way that was actually desirable rather than just functional. Then brining things right up to date, Spotify makes the whole thing cloud based and transferrable. I now have access to all the media I want, when, where and how I want to consume it BOOM! Now, bang on trend, I can concentrate on spending my disposable income on limited edition vinyl again! :-)

    My point is (and this is a work in progress) that this progressive innovation was kind of driven by latent desire hinted at by what we were all trying to do before it was fully available. It just took some people with vision to exploit that desire. Anyway, make of that what you will.

    As far as new examples go, I would offer this ColaLife as a more recent case study that sticks in my mind, and it does so for the following reasons:

    - If you want to talk about value, what greater value could there be to a consumer/end user than preventing their death?

    - It works with an existing capability, it just needed someone to make an imaginative leap to realise the potential

    - It demonstrates what can be achieved by people with different abilities, focus etc. coming together around a common cause

    - The solution to a problem, the value, was quite literally found in the spaces between what one very successful company considers to be it’s primary driver(s) of value.

    - Initial action and learning is now leading to future thinking about how the idea could be expanded to deliver even further value – the innovation is being sustained

    I think I’ve written enough now. Happy to talk offline about some of the projects and clients we are currently dealing with (largely still under NDA), just let me know.



    • zparadis

      Glad you found the Innovation Equation helpful! You’ve provided some nice subtle language improvement in addition to the specific feedback.

      I really like this thought you shared below and I anticipate what you’ll think of chapter 4: Understanding People:
      “My point is (and this is a work in progress) that this progressive innovation was kind of driven by latent desire hinted at by what we were all trying to do before it was fully available. It just took some people with vision to exploit that desire. Anyway, make of that what you will.”

      I’ll take a look at the ColaLife example. Many of your points related to ColaLife sound like they will map well to the Balanced Breakthrough model in Chapter 2. Would love to have your feedback on that as well if you get a second.

  • Erik Almenberg

    The innovation equation does a great job at illustrating the how opportunity and offering work together. I have found it very common that people new to innovation only see the offering part. A couple of potential improvements came to mind:

    1) Increase the distinction between innovation the outcome and innovation the process. My impression from the text is that the word innovation is used for both and that is a bit confusing.

    2) Save “Purpose” for chapter “Intent 1.0″. You write that you are considering introducing how “purpose” drives an organization. To me “purpose” is more of a starting point for the process, whereas opportunity/offering describes the process itself. “Purpose” fits in chapter “Intent 1.0″. More specifically in the “What if you don’t seem to have a problem?” section in that chapter – which I really like. It helps the reader orient their current situation to the book. I think the section could even be expanded further.

    • David

      Hi Erik,

      Thanks for your feedback. Drawing the a firm line between innovation as outcome vs. process is a doozy of a problem, but it would certainly provide clarity.

      Regarding “Purpose,” I’d love for you to share more of your thought on purpose as a starting point for the innovation process rather than part of the process itself. I initially thought it would fit under the Identifying Opportunity axis of the Innovation Equation. Understanding a firm’s purpose would create a constraint to make sure the vision is appropriate for their context, increasing the likelihood of a successful outcome.

    • davidmcgaw

      Hi Erik,

      Just wanted to add my thanks too for your feedback! Precision in language will be really important here–especially as we lay the groundwork, up front–so these are both good issues to bring to our intention.

      I wonder if the “purpose” question could be teased out in part by having different terms (that we try to use with more precision) that distinguish between Purpose of the Firm (reason for its existence), Purpose of the Project (why do we think we need an innovation), and for that matter, connecting to–but not bleeding into–the separate notion of Intent of the Innovation Effort (what we’re aiming at). Perhaps in part this helps address the issue raised by my colleague David Pierce about including some aspect of purpose (small p) in identifying opportunity?

      Makes me think that we’re just so embedded in a culture of linear process, that we lack the words to describe how, in an iterative approach, something like purpose takes on different levels of depth/clarity/focus over the course of learning about and making something new.

    • Bruno

      I Definitely agree with Erik on the need for a better distinction between the process and the content that leads to the outcome.

      • zparadis

        Thank you for confirming this. Feedback which is supported by multiple smart people will obviously be taken under more serious consideration. Very helpful.

  • Bruno

    The simple examples provided (Segway, Aztek) are helpful to grasp the context. I wonder how more helpful they would be if you go more in depth and explain what was done well in each case and what went wrong. Same would go for the iPod example: what did people at Apple did right to have both vision and invention, leading to an Innovation, especially in the context of already existing MP3 players from competitors.

    • David

      Thanks for the feedback! There are some examples in later chapters that go a bit more in depth than the Segway and Aztek in this chapter. I’ll be interested to see what you think about their level of detail.

      On a side note, do you have any ideas for updated examples? Segway has been relegated to mall security and tour groups, and the Aztek only lives on thanks to Breaking Bad.

      • Bruno

        I will look at the more in depth examples in following chapters, maybe I am being too impatient.

        The thinking behind my comment was that as a novice on the topic (and I believe the target audience for the book), I feel I need concrete and detailed enough examples at each steps to guide me in implementing at a small scale what I learn from the book. Examples help with putting the ideas in practice while avoiding comm pitfalls. and mistakes

        The 2 examples them selves are good at illustrating the ideas, so not need to change them.

  • joegray

    The widely documented failure of One Laptop Per Child (OLPC) could serve as an updated example for Good Vision/Bad Offering. OLPC’s stated Purpose was extraordinarily noble:

    “We aim to provide each child with a rugged, low-cost, low-power, connected laptop. To this end, we have designed hardware, content and software for collaborative, joyful, and self-empowered learning. With access to this type of tool, children are engaged in their own education, and learn, share, and create together. They become connected to each other, to the world and to a brighter future.”

    But OLPC failed in execution. The hardware offering ended up costing $200, twice as much as what was originally promised. And for education systems that were able to purchase and distribute the laptops, there was evidently little in the way of teacher training toward incorporating the laptops into existing curricula.

    Meanwhile, global mobile adoption has surpassed 95% and a slew of lower-cost alternatives are now being developed specifically for developing markets.

    • Zachary Jean Paradis

      FANTASTIC idea for an example. Done and credited!