Innovation is defined as “a creation (a new device or process) resulting from study and experimentation; the creation of something in the mind; the act of starting something for the first time; introducing something new; a change in customs; something new and contrary to established customs, manners, or rites” (Dictionary.com, n.d.).
Innovation is an action taken by individuals to create something that is first formed from an idea in the mind, then studied and researched carefully, and then developed. A new innovation or creation often flies in the face of the established and may be contrary to what is already in the marketplace.
To think like an innovator, one must learn to question the world around them, to imagine what might be, and to create in one’s mind an image of something that does not exist. This is a different way of thinking that is rare and often misunderstood. Consider the great inventors, scientists, and entrepreneurs, many of whom were laughed at and scorned, attaining little or no acclimation until years after they had passed away.
In an interconnected, highly competitive world, innovation is recognized as the essential element to stay ahead of the competition and create growth for the firm. Investors demand a return; the highest returns are generated when a new product or innovation disrupts the marketplace and creates a new culture or way that did not once exist. When a famous entrepreneur dropped out of school to start what became a major U.S. software and hardware company, many around him doubted the good sense of the idea. But he flew in the face of convention, and he took to the vision that he was beginning to see of a world in which each household had a computer of its own. This was quite extraordinary, considering the capability of a computer around 1980, which took up much space and was capable of many fewer processes than today. This entrepreneur’s innovative way of thinking helped propel the computer into the place it holds in society today.
Today as well, innovators have to overcome obstacles to successful innovation. For example, a famous motor company set out to make a sports car that is both green and does not sacrifice performance. This motor company has encountered scores of challenges, many centered on the technologies that allow it to build a completely electric car that will go from 0–60 miles per hour in 3.9 seconds. After its prototype was developed, it had engineering difficulties. It had presold over 500 cars and was pushing off the date that the cars would be available. In May 2008, in a conversation with a multimillionaire, who owned over half the motor company, he said that to date, he had put millions into the company. He stated that in 2007 alone, there had been more than six separate things that happened to almost take the company out of business; but in February 2008, the company was able to begin shipping cars and had overcome those issues.
Innovation Comes in All Sizes
Every day, innovations small and large change the landscape of our world. Take a simple coat hanger, for instance. There have been many small iterations of innovation to the coat hanger, each designed to provide a function better suited to the hanging of clothes. There are wire hangers, clip-on hangers, stacked clip-on hangers, plastic hangers, plastic hangers with hooks, and hangers with cardboard so pants do not get creased. Although these innovations are not as earth-shattering as the personal computer, design evolution like this is evidence of the spirit of innovation.
Entrepreneurial Business Environments
Of all the countries in the world, the United States has set up its economic system of free markets with entrepreneurship in mind. The ability to freely trade goods and services, to start and run an enterprise with minimal government interference, and the freedom to engage in venture activity makes the United States one of the best places to do business in the world. Many people migrate to the United States to start personal shops, gas stations, or local groceries, and in doing so, realize the dream of owning and not being owned.
Within the United States, there are also climates that are made for the business owner. For instance, many businesses are headquartered in Delaware because of the favorable business laws for corporations and the established set of case law. Each state also has a different tax code that may be friendlier to a business than another state. Some areas are known for entrepreneurship, especially for start-up companies, such as in the Silicon Valley near San Francisco. Sandhill Road is famous for housing many venture capital firms and banks that cater specifically to firms in start-up mode. There are entrepreneurship groups that meet on a regular basis to encourage one another, network, and gain information. Incubators also provide low-cost rent for start-ups and a sense of camaraderie as the business goes through the challenges that are unique to a new company. All of these provide certain climates that are positive to start-up ventures and business growth.
Of course, the reverse is also true. There are many countries, states, and areas not particularly friendly or well-versed for business ventures. The entrepreneur needs to consider these factors and choose wisely, because once a business is established and starts to grow, it is very difficult and cost-prohibitive to change climates and locations. The entrepreneur is wise to consider the climate of the area the business will be located before making a final decision because it plays a big role in the eventual success of an organization.
Innovation. (n.d.). Dictionary.com Unabridged (v 1.1). Retrieved March 31, 2009, from Dictionary.com Web site: http://dictionary.reference.com/browse/innovation