Notes- Entrepreneurship and Innovation

Entrepreneurship and Innovation

Creative as a prerequisite to innovation

The terms creativity and innovation are often used to mean the thing, but each has a unique connotation. 

           

1.             Creativity - is “the ability to bring something new into existence.  This definition emphasizes          the “ability”, not the “activity”, of bringing something new into existence.

2.             Innovation - is the process of doing new thing.

           

Innovation, therefore, is the transformation of creative ideas into useful applications, but creativity is a prerequisite to innovation.

The Creative Process

·            Entrepreneurs need ideas to pursue, and ideas seldom materialize accidentally.  Ideas usually evolve through a creative process whereby imaginative people, germinate ideas, nuture them, and develop them successfully.

·            Various labels have been applied to stages in the creative process, but most social scientist agree on five stages that we label as:  

1.   Idea Germination

2.   Preparation

3.   Incubation

4.   Illumination

5.   Verification

           

A model of the creative process:

Idea Germination: The stage of a new idea Recognition

Incubation: Subconscious assimilation of information Fantasizing

Verification: Application or Test to prove ideas have value validation

Illumination: Recognition of ideas as being feasible Realization

Preparation: Conscious search for knowledge Rationalization

 

                             ­­­­                              ­­­­                             ­­­­                              ­­­­

Innovation and Entrepreneurship

·      It is important to recognize that innovation implies action, not just conceiving new ideas.  When people have passed through the illumination and verification stages of creativity, they may have become inventors, but they are not yet innovators.

·      The difference between invention and innovation is:

1. Invention - is the creation of new products, processes, and technologies not previously known to exist?

2. Innovation - is the transformation of creative ideas into useful applications by combining resources in new or unusual ways to provide value to society for or improved products, technology, or services.

·      Elements in the Innovation Process

1. Analytical Planning - to identify: product design, market strategy, financial need

2. Organizing Resources - to obtain: materials, technology, human resources, capital

3. Implementation - to accomplish: organization, product design, manufacturing, services

4. Commercial Application - to provide: value to customers, reward of employees, revenues for         investors, satisfaction for founders.