Forbes India 15th Anniversary Special

Need for embracing 'wise innovation'

Here's how to create the next generation of innovators

Published: Jun 12, 2024 04:18:59 PM IST
Updated: Jun 12, 2024 04:23:44 PM IST

Innovation is about continuous improvement and the relentless pursuit of better solutions.
Image: ShuttersockInnovation is about continuous improvement and the relentless pursuit of better solutions. Image: Shuttersock

Although it has long been acknowledged that innovation is a key factor in growth and prosperity, the search for innovative solutions has not always been in line with larger societal and environmental objectives. 'Wise innovation' aims to bring together innovation, wisdom, compassion, and a comprehensive definition of success.

Defining innovation

Innovation, at its core, is about creating something new. This newness doesn't have to be a groundbreaking product or invention; it can manifest as new methods, policies, or approaches to work and life. The essence of innovation is recognising that new outcomes require new methods, and everyone, regardless of their job, can contribute to this process. True innovation isn't just about having novel ideas; it demands implementation and practical utility. An idea that doesn't improve upon existing solutions isn't genuine innovation; it's merely a creative exercise.

Scholars frequently use a spectrum to describe innovation, from incremental to radical. According to an article in The Atlantic magazine, fire, the wheel, agriculture, and the printing press are among the 50 greatest inventions of humankind. This article presents an interesting viewpoint. Revolutionary policies such as democracy or women's right to equality and to vote are also highlighted in this list of social innovations. These revolutionary inventions undoubtedly changed the world.

The value of derivative innovations

However, not every innovation must change the world to be meaningful. Even when it's not revolutionary, borrowing an idea from one space and using it in another is still innovative. For example, Amazon transformed the business paradigm by developing a two-sided online marketplace; other industries have adopted this idea. For instance, Airbnb and Uber are online marketplaces linking landlords and tenants, as well as car owners and passengers. Although not as radical as Amazon's original notion, they are nevertheless interesting.

The important thing to remember is that innovation is a spectrum, and where it falls on the spectrum does not necessarily indicate how valuable it is. Even derivative innovations have the potential to have a significant influence and improve the world. Therefore, innovation must be both new and useful, driving better results and adding value beyond what currently exists. This broader view of innovation extends beyond products and technologies, encompassing any new, useful approach that enhances our daily lives. Ultimately, innovation is about continuous improvement and the relentless pursuit of better solutions.

Core components

Innovation emerges from three core components. First, it has a clear objective, aiming to create something novel and valuable as its ultimate result. Second, a specific process is involved in achieving this innovative result. Various methods for fostering innovation have gained popularity at different times.

If you subscribe to the Silicon Valley philosophy of innovation, as I do, the lean startup method forms the foundation for most startups in that region. Coupled with agile development, it serves as the primary process for achieving innovation. This method involves identifying the problem, conducting experiments, learning from them, and iterating. It's a proven approach that has led to numerous innovations.

One major obstacle to innovation is the lack of knowledge about these methods. Many people, including those outside of product development, such as human resource professionals, are unaware of design thinking and the lean startup method. These methods can be applied to improve various aspects of their work, like creating better reward and retention policies.

Another crucial factor is mindset. Innovation flourishes with an entrepreneurial mindset, characterised by risk-taking and a focus on outcomes. However, excessive entrepreneurial enthusiasm can sometimes be counterproductive. Conversely, a growth mindset is strongly linked to innovation. It fosters the belief that one can continuously learn and overcome challenges. Therefore, grasping these processes and nurturing an entrepreneurial and growth mindset is vital for enabling innovation. The absence of these qualities often constitutes a barrier.

These skills and mindsets can be developed, and many business schools and coaching centres aim to teach both the innovation process and the necessary attitudes.

Also read: Nondisruptive creation: An alternative path to innovation and growth?

Beyond financial gain

Understanding that success cannot be determined exclusively by financial gain is at the core of intelligent innovation. Sustainability requires equal economic development, community well-being, and environmental stewardship/care. This is similar to the idea of the 'triple bottom line', first proposed by academic John Elkington, which advocates taking the 3 P's—profit, people, and the planet—into account.

But striking this equilibrium is no easy feat. Many inventions have unintentionally harmed the environment or society despite their financial success. Consider the ubiquitous plastic water bottle, which has both increased environmental pollution and facilitated access to clean water.

Therefore, wise innovation aims to be 'net positive' in all three dimensions—profit, people and planet—to overcome this dichotomy. This calls for a mentality change beyond conventional strategies like lean startup or design thinking. Rather, it advocates for incorporating more expansive viewpoints, such as responsible innovation and systems thinking.

Integrating wisdom into innovation

The goal of sensible innovation should be embedded in corporate partnerships and curricula. In addition to conventional innovation methodologies, the formation of a wisdom mentality and a paradox mindset should be prioritised. The wisdom mindset encourages compassion and holistic decision-making, drawing from ancient philosophical traditions. On the other hand, individuals with a paradoxical mindset can better reconcile seemingly incompatible goals and come up with original solutions that meet multiple needs.

By adopting these mindsets, students and business clients can approach complex challenges with creativity and honesty. A fundamental component of the wisdom mentality, epistemological humility, serves as a constant reminder that there are always fresh avenues to pursue and viewpoints to consider. This willingness to consider different points of view enhances the creative process and promotes resilience and creativity.

Though prudent innovation is relatively new, ethical, purpose-driven innovators may strongly relate to its guiding principles. We should pave the path for a future where innovation is profitable and transformative for the planet and society as long as it champions this approach.
Dr. Varun Nagaraj is Dean and Professor of Information Management & Analytics at S.P. Jain Institute of Management & Research (SPJIMR).

[This article has been reproduced with permission from SP Jain Institute of Management & Research, Mumbai. Views expressed by authors are personal.]