Austrian economist, Joseph Schumpeter (1934), described innovation over 70 years ago using five well defined principles:
“An innovative business is one which lives and breathes “outside the box”. It is not just good ideas; it is a combination of good ideas, motivated staff and an instinctive understanding of what your customer wants”
Richard Branson declared in a speech at the Department of Trade and Industry (DTI) Innovation Lecture in 1998 (cited in Tidd 2009)
Stanwick (2011) asserts that innovation is much more than science and research. He argues that enterprises should be innovating not just with technology but with operations, organisational structures, business models and relationships. Tidd (2009) adds another dimension to these definitions by stating that innovation cannot happen in isolation but instead must take place across the organisation “through the development of processes for turning opportunities into new ideas and transforming them into widely used practice across the organisation”.
- The introduction of a good (product), which is new to consumers, or one of higher quality than was available in the past.
- Methods of production, which are new to a particular branch of industry. These are not necessarily based on new scientific discoveries and may have, for example, already been used in other industrial sectors.
- The opening of new markets.
- The use of new sources of supply.
- New forms of competition, that leads to the restructuring of an industry
