We hear talk about innovation, its relevance for economic development and its value as a wealth-generating tool basically on a daily basis. But what is innovation, really?
We hear talk about innovation, its relevance for economic development and its value as a wealth-generating tool basically on a daily basis. But when we want to define it, we cannot point out specifically what makes it different from research and development or from new activities that are not innovations. That is why we must start by defining innovation.
The Spanish Royal Academy dictionary gives two definitions of innovation:
- The effect of innovating (which means changing or altering something, introducing new ways of doing something)
- Creating or modifying a product and launching it to market.
Wikipedia defines innovation as a change that introduces something new. Besides, broadly speaking, the concept is used to refer to new proposals, inventions, and their economic implementation. However, in the strict sense of the word, it is said that ideas can only be innovations if new products, services, and procedures are implemented as a result, if there is really a successful application spread throughout the market and dominating it.
The OECD’s Oslo Manual (1997) provides guidelines to measure scientific and technological activity. It defines innovation as the ideation and implementation of significant changes to the product, the processes, the marketing, or a business organization, ultimately seeking to improve its results.
From these definitions we can infer the features of innovation:
- It is an action, a process, an activity. Innovation requires agency.
- This action entails a significant change or modification. Innovation requires changes.
- This change must be rolled out to the market to achieve better results. Innovation requires a profit in the market.
- And, innovation requires sustainability over time.
By combining all these features, we determine the Bankinter Innovation Foundation’s definition of innovation:
“Innovation are original ideas that generate social or economic value sustainably”.
This is the backbone of the Foundation’s activities, as we pursue a more robust innovation that drives social transformation onwards.
To learn more about innovation, don’t miss the post “The 10 Types Of Innovation”.