Most of the benefits of innovation go to entrepreneurial consumers. An in-depth article on “Venturesome Consumption”, by Amar Bhidé, is essential reading for anyone researching the creation of value by exploiting new ideas.
Innovation is defined as many things. The best encompass both the idea and its exploitation. For example: “Innovation is the successful exploitation of new ideas” (source, UK Government web site).
The organizers of the recent Technology, Innovation and Growth Forum in London, England, kindly asked me to join a panel discussion on ‘Venturesome Consumption’. This took its title from a July 2006 paper by Amar Bhidé “Venturesome Consumption, Innovation and Globalization“.
Professor Bhidé argues that “the willingness of firms and individuals to acquire and use new products and technologies is as important as… the development of such products and technologies”. Hence the need for a ‘venturesome consumer’ if a new idea is going to succeed.
He also explores the question of who most benefits from an innovation – the originator of the idea or its consumer, concluding that: “when users of innovations are sufficiently entrepreneurial, they secure most of the benefits, regardless of where the upstream producers might be located.” Looking specifically at IT innovation, he also considers the extent to which the level of risk-aversion in IT staff can impact the innovative consumption and exploitation of technology.
As I’ve written elsewhere, corporate strategies for IT are increasingly focusing on the exploitation of technology rather than its production, deployment and operation. Strategically, “venturesome consumption” of technology, where most of the value is created – rather than venturesome production – is just getting into its stride. If you’re in IT, make sure your leading it and not holding it back.