by Nicholas D. Evans

The importance of precise terminology for innovation

Dec 13, 20124 mins
Digital TransformationIT Leadership

Innovation is one of those terms that means many things to many people. Depending upon who you speak to, you’ll get a number of equally valid definitions and perspectives. Perhaps the same can be said for topics such as consumerization of IT and even cloud computing, but that’s perhaps a topic for another blog. Here we’ll tackle why precise terminology for innovation is important and some ways to get started.

When we think about innovation, clearly everyone wants to deliver more innovation to their customers, wants their organizations to be more innovative internally, and wants to see more innovation from their strategic partners and suppliers. These are certainly noble goals and just like any other goals they need SMART objectives — Specific, Measurable, Attainable, Relevant and Time-bound — so that customers, partners and employees actually know why these innovation efforts are important, what they’re trying to achieve, and when their efforts are moving in the right direction.

In addition, one item I personally believe is highly important for success in the innovation arena is a common agreement on terminology. Without common agreement on the precise meaning of various terms related to innovation, organizations will risk mis-aligned objectives, expectations and outcomes.

To give an example, how would you define an Innovation Workshop? Is it a highly-structured brainstorming session with online group decision-support software and a step-by-step methodology with trained facilitators, an ad-hoc whiteboarding session to explore ideas, or perhaps a day full of presentations with a customer? Should an Innovation Workshop focus purely on disruptive (i.e. transformational) innovations or incremental (i.e. tactical) innovations as well?

As another example, how would you define innovation investments? What constitutes an investment in innovation compared to one for sustaining existing products and services? How about the space in-between where you’re innovating to enhance existing products and services? How do you define terms such as core investments, adjacent investments and transformational investments? 

The answer is “innovation” and it’s related terms can be whatever you’d like to define them as. The important point is that clear definitions are needed so that everyone is on the same page and knows what you, or others, mean when these terms are brought up in conversation. An innovation workshop then means x, and not y or z. An innovation investment means a, and not b or c, and so forth. Scoping is highly important as well, so your audience knows what’s in and out of scope in your innovation agenda.

If you’re managing an innovation program within your organization, these kinds of definitions are some of the first things you should spell out. If you’re a stakeholder or participant in various innovation initiatives, these definitions are things you should expect to get answers to and be able to find clearly articulated and readily available.

Some of the first areas to pay attention to are your definition of innovation, your definition of innovation investments, and how you intend to measure success. Of course, the specific tactics your company employs in order to achieve your desired innovative outcomes may vary year-over-year, but the fundamental terms of how you invest in and measure innovation should be fairly constant so you can measure year-over-year progress.

As an example, in terms of innovation investments, think about clearly delineating between the innovation objective (e.g. sustaining the core business, investing in adjacenies to the core business, and investing in transformational new areas for the business) and the type of innovation (e.g. business model, process, organizational, product, or service innovation etc.). That way, you can track items such as your innovation investment mix over time as discussed in my article on “Investing in transformation for 2013“.

Note that these definitions may also change, or have different underlying options by which to categorize, depending upon whether you’re taking an organizational view or a broader industry or market view. For example, in a recent New York Times article, Clayton Christensen talks about three types of innovation investment as being “empowering”, “sustaining” or “efficiency”-oriented.

Spending some extra time upfront in defining your terminology for innovation can pay dividends in terms of downstream efficiency and aligning all your participants so you can then focus less on the definitions and explanations and more on the actual innovative outcomes your organization intends to deliver. As you scale your program across business units and even globally, the payback becomes even more significant.

Finally, defining your terminology, and even the underlying taxonomy, for innovation is never a one-shot deal. Over time, memories fade and employees change roles, so you’ll need an appropriate cadence of communications and training in order to institutionalize these learnings and best practices.