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{{Short description|Practical implementation of improvements}}
{{other uses|Innovation (disambiguation)|Innovators (disambiguation)}}
{{Use dmy dates|date=October 2020}}
[[Image:Edison and phonograph edit2.jpg|thumb|190px|[[Thomas Edison]] with [[phonograph]] in the late 1870s. Edison was one of the most prolific inventors in history, holding [[List of Edison patents|1,093 U.S. patents in his name]].]]

'''Innovation''' is the practical implementation of [[ideas]] that result in the introduction of new [[goods]] or [[service (economics)|services]] or improvement in offering goods or services.<ref>{{Cite book|last=Schumpeter, Joseph A., 1883–1950|title=The theory of economic development: an inquiry into profits, capital, credit, interest, and the business cycle|others=Opie, Redvers,, Elliott, John E.|year=1983|isbn=0-87855-698-2|location=New Brunswick, New Jersey|oclc=8493721}}</ref> [[ISO TC 279]] in the standard ISO 56000:2020 defines innovation as "a new or changed entity, realizing or redistributing [[value (economics)|value]]".<ref>{{cite web | url = https://www.iso.org/obp/ui/#iso:std:iso:56000:ed-1:v1:en:term:3.1.1| title = ISO 56000:2020(en)Innovation management — Fundamentals and vocabulary | date = 2020| work = ISO }}</ref> Others have different definitions; a common element in the definitions is a focus on newness, improvement, and spread of ideas or technologies.

Innovation often takes place through the development of more-effective [[product (business)|product]]s, processes, [[Service (economics)|service]]s, [[technologies]], [[art work]]s<ref>
{{cite book
 | editor1-last = Lijster
 | editor1-first = Thijs
 | title = The Future of the New: Artistic Innovation in Times of Social Acceleration
 | url = https://books.google.com/books?id=PH1ovQEACAAJ
 | series = Arts in society
 | publisher = Valiz
 | date = 2018
 | isbn = 978-94-92095-58-9
 | access-date = 10 September 2020
}}
</ref>
or [[business model]]s that '''innovators''' make available to [[Market (economics)|market]]s, [[government]]s and [[society]].

Innovation is related to, but not the same as, [[invention]]:<ref>{{cite web | url = http://www.businessinsider.com/this-is-the-difference-between-invention-and-innovation-2012-4 | title = This Is The Difference Between 'Invention' And 'Innovation' | first = Kim | last = Bhasin | date = 2 April 2012 | work = Business Insider }}</ref> innovation is more apt to involve the practical implementation of an invention (i.e. new / improved ability) to make a meaningful impact in a market or society,<ref>{{citation | url= https://www.forbes.com/sites/jacobmorgan/2015/09/10/whats-the-difference-between-invention-and-innovation/ | title= What's the Difference Between Invention and Innovation?|magazine= Forbes|date= 10 September 2015}}</ref> and not all innovations require a new invention.<ref>
{{cite book
 | last1 = Schumpeter
 | first1 = Joseph Alois
 | author-link1 = Joseph Schumpeter
 | title = Business Cycles
 | volume = 1
 | date = 1939
 | page = 84
 | quote = Innovation is possible without anything we should identify as invention, and invention does not necessarily induce innovation.
}}
</ref>

Technical innovation often manifests itself via the [[engineering]] process when the problem being solved is of a technical or scientific nature. The opposite of innovation is [[exnovation]].

==Definition==
Surveys of the literature on innovation have found a variety of definitions. In 2009, Baregheh et al. found around 60 definitions in different scientific papers, while a 2014 survey found over 40.<ref name="Henry2014" />  Based on their survey, Baragheh et al. attempted to formulate a multidisciplinary definition and arrived at the following:<blockquote>"Innovation is the multi-stage process whereby organizations transform ideas into new/improved products, service or processes, in order to advance, compete and differentiate themselves successfully in their marketplace"<ref>{{Cite journal|last1=Baregheh|first1=Anahita|last2=Rowley|first2=Jennifer|last3=Sambrook|first3=Sally|date=2009-09-04|title=Towards a multidisciplinary definition of innovation|url=https://www.emerald.com/insight/content/doi/10.1108/00251740910984578/full/html|journal=Management Decision|language=en|volume=47|issue=8|pages=1323–1339|doi=10.1108/00251740910984578|issn=0025-1747}}</ref></blockquote>
In a study of how the [[software industry]] considers innovation, the following definition given by Crossan and Apaydin was considered to be the most complete.  Crossan and Apaydin built on the definition given in the [[Organisation for Economic Co-operation and Development|Organisation for Economic Co-operation and Development (OECD)]] Oslo Manual:<ref name="Henry2014">Edison, H., Ali, N.B., & Torkar, R. (2014). [https://torkar.github.io/pdfs/jss-edisonNT13.pdf Towards innovation measurement in the software industry]. ''Journal of Systems and Software'' 86(5), 1390–407.</ref> {{blockquote|Innovation is production or adoption, assimilation, and exploitation of a value-added novelty in economic and social spheres; renewal and enlargement of products, services, and markets; development of new methods of production; and the establishment of new management systems. It is both a process and an outcome.|title=|source=}}
American sociologist [[Everett Rogers]], defined it as follows:<blockquote>"An idea, practice, or object that is perceived as new by an individual or other unit of adoption"<ref>{{Cite book|last=Rogers, Everett M.|title=Diffusion of innovations|date=2003|publisher=Free Press|isbn=0-7432-2209-1|edition=5th|location=New York|oclc=52030797}}</ref></blockquote>
According to Alan Altshuler and Robert D. Behn, innovation includes original invention and creative use.  These writers define innovation as generation, admission and realization of new ideas, products, services and processes.<ref>{{Cite book|title=Innovation in American Government: Challenges, Opportunities, and Dilemmas|publisher=Brookings Inst Pr|isbn=978-0-8157-0358-7|date=1 June 1997|url-access=registration|url=https://archive.org/details/innovationinamer0000unse}}</ref>

Two main dimensions of innovation are degree of [[novelty]] (i.e. whether an innovation is new to the firm, new to the market, new to the industry, or new to the world) and kind of innovation (i.e. whether it is process or [[product-service system]] innovation).<ref name="Henry2014" /> Organizational researchers have also distinguished innovation separately from creativity, by providing an updated definition of these two related constructs:{{blockquote|Workplace creativity concerns the cognitive and behavioral processes applied when attempting to generate novel ideas. Workplace innovation concerns the processes applied when attempting to implement new ideas. Specifically, innovation involves some combination of problem/opportunity identification, the introduction, adoption or modification of new ideas germane to organizational needs, the promotion of these ideas, and the practical implementation of these ideas.<ref>{{Cite journal|last1=Hughes|first1=D. J.|last2=Lee|first2=A.|last3=Tian|first3=A. W.|last4=Newman|first4=A.|last5=Legood|first5=A.|year=2018|title=Leadership, creativity, and innovation: A critical review and practical recommendations|journal=The Leadership Quarterly|volume=29|issue=5|pages=549–569|doi=10.1016/j.leaqua.2018.03.001|hdl=10871/32289|s2cid=149671044|url=https://publications.aston.ac.uk/id/eprint/33129/1/LQfinalversionR2_2018.02.22.pdf |archive-url=https://web.archive.org/web/20191224045013/https://publications.aston.ac.uk/id/eprint/33129/1/LQfinalversionR2_2018.02.22.pdf |archive-date=2019-12-24 |url-status=live|hdl-access=free}}</ref>|title=|source=}}

[[Peter Drucker]] wrote:

{{blockquote|Innovation is the specific function of entrepreneurship, whether in an existing business, a public service institution, or a new venture started by a lone individual in the family kitchen. It is the means by which the entrepreneur either creates new wealth-producing resources or endows existing resources with enhanced potential for creating wealth.<ref name="Drucker">{{cite journal |title=The Discipline of Innovation |journal=[[Harvard Business Review]] |url= http://hbr.org/2002/08/the-discipline-of-innovation/ar/1 |date=August 2002 |access-date=13 October 2013|last1=Drucker |first1=Peter F. }}</ref>|title=|source=}}

=== Creativity and innovation ===
In general, innovation is distinguished from [[creativity]] by its emphasis on the implementation of creative ideas in an economic setting. [[Teresa Amabile|Amabile]] and Pratt in 2016, drawing on the literature, distinguish between creativity ("the production of novel and useful ideas by an individual or small group of individuals working together") and innovation ("the successful implementation of creative ideas within an organization").<ref>{{cite journal |last1=Amabile |first1=Teresa M. |last2=Pratt |first2=Michael G. |title=The dynamic componential model of creativity and innovation in organizations: Making progress, making meaning |journal=Research in Organizational Behavior |year=2016 |volume=36 |pages=157–183 |doi=10.1016/j.riob.2016.10.001|s2cid=44444992 }}</ref>

===Economics and innovation===
In 1957 the economist [[Robert Solow]] was able to demonstrate that [[economic growth]] had two components. The first component could be attributed to growth in [[Production (economics)|production]] including [[wage labour]] and [[Capital (economics)|capital]]. The second component was found to be [[productivity]]. Ever since, economic historians have tried to explain the process of innovation itself, rather than assuming that technological inventions and technological progress result in productivity growth.<ref>{{cite book | author1=Leonard Dudley |title=Mothers of Innovation: How Expanding Social Networks Gave Birth to the Industrial Revolution |publisher= Cambridge Scholars Publishing |year=2012 |page=4 |isbn=9781443843126 }}</ref>

The concept of innovation emerged after the Second World War, mostly thanks to the works of [[Joseph Schumpeter]] (1883–1950) who described the economic effects of innovation processes as ''[[Creative destruction|Constructive destruction]]''. Today, consistent neo-Schumpeterian scholars see innovation not as neutral or apolitical processes.<ref>{{Cite book |last1=Jasanoff |first1=Sheila |url=http://dx.doi.org/10.7208/chicago/9780226276663.001.0001 |title=Dreamscapes of Modernity |last2=Kim |first2=Sang-Hyun |date=2015 |publisher=University of Chicago Press |doi=10.7208/chicago/9780226276663.001.0001 |isbn=978-0-226-27652-6}}</ref><ref>{{Cite journal |last=Papaioannou |first=Theo |date=2020-05-03 |title=Innovation, value-neutrality and the question of politics: unmasking the rhetorical and ideological abuse of evolutionary theory |url=https://www.tandfonline.com/doi/full/10.1080/23299460.2019.1605484 |journal=Journal of Responsible Innovation |language=en |volume=7 |issue=2 |pages=238–255 |doi=10.1080/23299460.2019.1605484 |s2cid=159275720 |issn=2329-9460}}</ref> Rather, innovation can be seen as socially constructed processes. Therefore, its conception depends on the political and societal context in which innovation is taking place.<ref name=":6"/> According to Shannon Walsh, "innovation today is best understood as innovation under capital" (p.&nbsp;346).<ref name=":5">{{Cite journal |last=Walsh |first=Shannon |date=2021-05-21 |title=Marx, subsumption and the critique of innovation |url=http://dx.doi.org/10.1177/13505084211015377 |journal=Organization |volume=30 |issue=2 |pages=345–360 |doi=10.1177/13505084211015377 |s2cid=236375680 |issn=1350-5084}}</ref> This means that the current hegemonic purpose for innovation is capital valorisation and profit maximization, exemplified by the appropriation of knowledge (e.g., through [[patent]]ing), the widespread practice of [[Planned obsolescence]] (incl. lack of [[Repairability|repairability by design]]), and the [[Jevons paradox]], that describes negative consequences of eco-efficiency as energy-reducing effects tend to trigger mechanisms leading to energy-increasing effects.<ref>{{Cite journal |last1=Lange |first1=Steffen |last2=Pohl |first2=Johanna |last3=Santarius |first3=Tilman |date=2020-10-01 |title=Digitalization and energy consumption. Does ICT reduce energy demand? |url=https://www.sciencedirect.com/science/article/pii/S0921800919320622 |journal=Ecological Economics |volume=176 |pages=106760 |doi=10.1016/j.ecolecon.2020.106760 |s2cid=224947774 |issn=0921-8009}}</ref>

== Types ==
Several frameworks have been proposed for defining types of innovation.<ref>{{Cite news|last=Blank|first=Steve|date=1 February 2019|title=McKinsey's Three Horizons Model Defined Innovation for Years. Here's Why It No Longer Applies.|work=Harvard Business Review|url=https://hbr.org/2019/02/mckinseys-three-horizons-model-defined-innovation-for-years-heres-why-it-no-longer-applies|access-date=16 August 2020|issn=0017-8012}}</ref><ref>{{Cite news|last=Satell|first=Greg|date=21 June 2017|title=The 4 Types of Innovation and the Problems They Solve|work=Harvard Business Review|url=https://hbr.org/2017/06/the-4-types-of-innovation-and-the-problems-they-solve|access-date=16 August 2020|issn=0017-8012}}</ref>

=== Sustaining vs disruptive innovation ===
[[File:L-Hochrad.png|thumb|upright=1.5|An 1880 penny-farthing (left), and a 1886 [[Rover Company#Before cars|Rover]] safety bicycle with gearing]]
One framework proposed by [[Clayton Christensen]] draws a distinction between sustaining and [[disruptive innovation]]s.<ref>{{Cite news|last1=Bower|first1=Joseph L.|last2=Christensen|first2=Clayton M.|date=1 January 1995|title=Disruptive Technologies: Catching the Wave|work=Harvard Business Review|issue=January–February 1995|url=https://hbr.org/1995/01/disruptive-technologies-catching-the-wave|access-date=16 August 2020|issn=0017-8012}}</ref> Sustaining innovation is the improvement of a product or service based on the known needs of current customers (e.g. faster microprocessors, flat screen televisions). Disruptive innovation in contrast refers to a process by which a new product or service creates a new market (e.g. transistor radio, free crowdsourced encyclopedia, etc.), eventually displacing established competitors.<ref>{{Cite news|last1=Christensen|first1=Clayton M.|last2=Raynor|first2=Michael E.|last3=McDonald|first3=Rory|date=1 December 2015|title=What Is Disruptive Innovation?|work=Harvard Business Review|issue=December 2015|url=https://hbr.org/2015/12/what-is-disruptive-innovation|access-date=16 August 2020|issn=0017-8012}}</ref><ref>{{Cite web|title=Disruptive Innovations|url=https://www.christenseninstitute.org/disruptive-innovations/|access-date=16 August 2020|publisher=Christensen Institute|language=en-US}}</ref> According to Christensen, disruptive innovations are critical to long-term success in business.<ref>{{cite journal|author=Christensen, Clayton & Overdorf, Michael|year=2000|title=Meeting the Challenge of Disruptive Change|url=https://hbr.org/2000/03/meeting-the-challenge-of-disruptive-change|journal=Harvard Business Review}}</ref>

Disruptive innovation is often enabled by disruptive technology. Marco Iansiti and Karim R. Lakhani define foundational technology as having the potential to create new foundations for global technology systems over the longer term. Foundational technology tends to transform business [[operating model]]s as entirely new business models [[emergence|emerge]] over many years, with gradual and steady adoption of the innovation leading to waves of [[technological change|technological]] and [[institution]]al change that gain momentum more slowly.<ref name="hbr201701">
{{cite news |last1=Iansiti|first1=Marco |last2=Lakhani|first2=Karim R. |url=https://hbr.org/2017/01/the-truth-about-blockchain |title=The Truth About Blockchain |work=[[Harvard Business Review]] |publisher=[[Harvard University]] |date=January 2017 |access-date=17 January 2017 |quote=a foundational technology: It has the potential to create new foundations for our economic and social systems. }}</ref>{{Additional citation needed|date=August 2020}} The advent of the [[packet-switched]] communication protocol [[TCP/IP]]—originally introduced in 1972 to support a single [[use case]] for [[United States Department of Defense]] electronic communication (email), and which gained widespread adoption only in the mid-1990s with the advent of the [[World Wide Web]]—is a foundational technology.<ref name="hbr201701" />

=== Four types of innovation model ===
Another framework was suggested by Henderson and Clark. They divide innovation into four types;
* '''Radical innovation''': "establishes a new dominant design and, hence, a new set of core design concepts embodied in components that are linked together in a new architecture." (p.&nbsp;11)<ref name=":1">{{Cite journal|last1=Henderson|first1=Rebecca M.|last2=Clark|first2=Kim B.|date=March 1990|title=Architectural Innovation: The Reconfiguration of Existing Product Technologies and the Failure of Established Firms|journal=Administrative Science Quarterly|volume=35|issue=1|page=9|doi=10.2307/2393549|jstor=2393549|s2cid=6255046 |issn=0001-8392|url=http://nrs.harvard.edu/urn-3:HUL.InstRepos:37971074 }}</ref>
* '''Incremental innovation''': "refines and extends an established design. Improvement occurs in individual components, but the underlying core design concepts, and the links between them, remain the same." (p.&nbsp;11)<ref name=":1" />
* '''Architectural innovation''': "innovation that changes only the relationships between them [the core design concepts]" (p.&nbsp;12)<ref name=":1" />
* '''Modular Innovation''': "innovation that changes only the core design concepts of a technology" (p.&nbsp;12)<ref name=":1" />

While Henderson and Clark as well as Christensen talk about technical innovation there are other kinds of innovation as well, such as service innovation and organizational innovation.

===Non-economic innovation===
As distinct from business-centric views of innovation concentrating on generating profit for a firm, other types of innovation include: [[social innovation]], religious innovation,<ref>
{{cite book
 |editor-last1         = Williams
 |editor-first1        = Michael A.
 |editor-last2         = Cox
 |editor-first2        = Collett
 |editor-last3         = Jaffee
 |editor-first3        = Martin S.
 |year                 = 1992
 |title                = Innovation in Religious Traditions: Essays in the Interpretation of Religious Change
 |url                  = https://books.google.com/books?id=AD2hShiXNjEC
 |series               = Religion and society (volume 31)
 |publication-place    = Berlin
 |publisher            = Walter de Gruyter
 |isbn                 = 9783110127805
 |access-date          = 16 February 2024
}} 
</ref>
[[sustainable innovation]] (or [[green innovation]]),<ref name=":2">{{Cite journal|last1= Schiederig|first1= Tim|last2= Tietze|first2= Frank|last3= Herstatt|first3= Cornelius|date= 22 February 2012|title= Green innovation in technology and innovation management – an exploratory literature review|journal= R&D Management|volume= 42|issue=2|pages= 180–192|doi= 10.1111/j.1467-9310.2011.00672.x|s2cid=153958119|issn=0033-6807}}
</ref>
and [[responsible innovation]].<ref>
{{Citation|last1= Blok|first1= Vincent|year= 2015|work=Responsible Innovation 2|pages=19–35|place= Cham|publisher= Springer International Publishing|isbn=978-3-319-17307-8|last2=Lemmens|first2=Pieter|title=The Emerging Concept of Responsible Innovation. Three Reasons Why It is Questionable and Calls for a Radical Transformation of the Concept of Innovation |doi=10.1007/978-3-319-17308-5_2|hdl=2066/150613|hdl-access=free}}
</ref>

=== Open innovation ===
One type of innovation that has been the focus of recent literature is [[open innovation]] or "[[Crowdsourcing|crowd sourcing]]." Open innovation refers to the use of individuals outside of an organizational context who have no expertise in a given area to solve complex problems.<ref name=":4">{{Cite journal |last=Amabile |first=Teresa |date=December 2017 |title=In Pursuit of Everyday Creativity |url=https://www.hbs.edu/ris/Publication%20Files/18-002_ee708f75-293f-4494-bf93-df5cd96b48a6.pdf |journal=Journal of Creative Behavior |pages=2–3 |via=Harvard Business School}}</ref>

=== User innovation ===
Similar to open innovation, [[user innovation]] is when companies rely on users of their goods and services to come up with, help to develop, and even help to implement new ideas.<ref name=":4" />

==History==
{{See also|Innovation economics}}
Innovation must be understood in the historical setting in which its processes were and are taking place.<ref name=":6"/> The first full-length discussion about innovation was published by the Greek philosopher and historian [[Xenophon]] (430–355 BCE). He viewed the concept as multifaceted and connected it to political action. The word for innovation that he uses, ''kainotomia'', had previously occurred in two plays by [[Aristophanes]] ({{circa |446}} – {{circa | 386}} BCE). [[Plato]] (died {{circa | 348}} BCE) discussed innovation in his [[Laws (dialogue)|''Laws'']] dialogue and was not very fond of the concept. He was skeptical to it both in culture (dancing and art) and in education (he did not believe in introducing new games and toys to the kids).<ref name=":0">{{Cite book |last=Godin, Benoit |title=Innovation contested: the idea of innovation over the centuries |year= 2015 |publisher=Routledge |isbn= 9781315855608 |oclc= 903958473}}</ref> [[Aristotle]] (384–322 BCE) did not like organizational innovations: he believed that all possible forms of organization had been discovered.<ref>Politics II as cited by Benoît Godin (2015)</ref>

Before the 4th century in Rome, the words ''novitas'' and ''res nova / nova res'' were used with either negative or positive judgment on the innovator. This concept meant "renewing" and was incorporated into the new Latin verb word ''innovo'' ("I renew" or "I restore") in the centuries that followed. The ''[[Vulgate]]'' version of the Bible (late 4th century CE) used the word in spiritual as well as political contexts. It also appeared in poetry, mainly with spiritual connotations, but was also connected to political, material and cultural aspects.<ref name=":0" />

[[Niccolò Machiavelli|Machiavelli]]'s ''[[The Prince]]'' (1513) discusses innovation in a political setting. Machiavelli portrays it as a strategy a Prince may employ in order to cope with a constantly changing world as well as the corruption within it. Here innovation is described as introducing change in government (new laws and institutions); Machiavelli's later book ''The Discourses'' (1528) characterises innovation as imitation, as a return to the original that has been corrupted by people and by time.{{citation needed|date=February 2022}} Thus for Machiavelli innovation came with positive connotations. This is however an exception in the usage of the concept of innovation from the 16th century and onward. No innovator from the renaissance until the late 19th century ever thought of applying the word innovator upon themselves, it was a word used to attack enemies.<ref name=":0" />

From the 1400s{{citation needed|date=September 2020}} through the 1600s, the concept of innovation was pejorative – the term was an [[Early Modern English|early-modern]] synonym for "rebellion", "revolt" and "[[heresy]]".<ref name="Mazzaferro">{{cite journal| last1= Mazzaferro|first1= Alexander| year= 2018| title= Such a Murmur": Innovation, Rebellion, and Sovereignty in William Strachey's "True Reportory| journal=Early American Literature|volume= 53 |issue= 1| pages=3–32| doi=10.1353/eal.2018.0001| s2cid=166005186}}</ref><ref name="Diss">{{cite thesis| last1= Mazzaferro| first1=Alexander McLean| url=https://rucore.libraries.rutgers.edu/rutgers-lib/55583/| title="No newe enterprize" (Doctoral dissertation)| date=2017| publisher=Rutgers University| doi= 10.7282/T38W3HFQ| access-date=19 February 2019}}</ref><ref name="Lepore">{{cite magazine| last1= Lepore| first1= Jill | date= 23 June 2014 | title=The Disruption Machine: What the gospel of innovation gets wrong | magazine=The New Yorker |url= https://www.newyorker.com/magazine/2014/06/23/the-disruption-machine | access-date=19 February 2019 }}</ref><ref name="Green">{{cite news| last1= Green |first1= Emma |date= 20 June 2013 | title=Innovation: The History of a Buzzword | publisher=The Atlantic | url= https://www.theatlantic.com/business/archive/2013/06/innovation-the-history-of-a-buzzword/277067/ | access-date=19 February 2019}}
</ref><ref>{{oed|innovation}}
</ref> In the 1800s{{Clarify timeframe|date=February 2022}} people promoting [[capitalism]] saw [[socialism]] as an innovation and spent a lot of energy working against it. For instance, [[Goldwin Smith]] (1823-1910) saw the spread of social innovations as an attack on money and banks. These social innovations were socialism, communism, nationalization, cooperative associations.<ref name=":0" />

In the 20th century, the concept of innovation did not become popular until after the Second World War of 1939–1945. This is the point in time when people started to talk about ''technological'' product innovation and tie it to the idea of economic growth and competitive advantage.<ref>{{Cite book| author1=Benoit Godin| title= The invention of technological innovation: languages, discourses and ideology in historical perspective| publisher=Edward Elgar Publishing| year=2019| isbn=9781789903348| oclc=1125747489}}</ref> [[Joseph Schumpeter]] (1883–1950), who contributed greatly to the study of [[innovation economics]], is seen as the one who made the term popular. Schumpeter argued that industries must incessantly revolutionize the economic structure from within, that is: innovate with better or more effective processes and products, as well as with market distribution (such as the transition from the craft shop to factory). He famously asserted that "[[creative destruction]] is the essential fact about [[capitalism]]".<ref name="capsocdem">{{cite book |author=Schumpeter, J. A. |title=Capitalism, Socialism, and Democracy |publisher=Routledge |year=1943 |isbn=9780415107624 |edition=6 |pages=81–84 |author-link=Joseph Schumpeter}}</ref> In [[commerce|business]] and in [[economics]], innovation can provide a catalyst for growth when [[entrepreneur]]s continuously search for better ways to satisfy their [[Consumer demand|consumer base]] with improved quality, durability, service and price - searches which may come to fruition in innovation with advanced technologies and organizational strategies.<ref>Heyne, P., Boettke, P. J., and Prychitko, D. L. (2010). ''The Economic Way of Thinking''. Prentice Hall, 12th ed. pp. 163, 317–18.</ref> Schumpeter's findings coincided with rapid advances in [[transportation]] and [[communications]] in the beginning of the 20th century, which had huge impacts for the economic concepts of [[factor endowment]]s and [[comparative advantage]] as new combinations of resources or production techniques constantly transform markets to satisfy consumer needs. Hence, innovative behaviour becomes relevant for economic success.<ref>{{Citation |last=Swedberg |first=Richard |title=Rebuilding Schumpeter's Theory of Entrepreneurship |date=2009-01-30 |url=http://dx.doi.org/10.4337/9781848446168.00018 |work=Marshall and Schumpeter on Evolution |access-date=2023-12-25 |publisher=Edward Elgar Publishing |doi=10.4337/9781848446168.00018 |isbn=978-1-84844-616-8}}</ref>

== Process of innovation ==
An early model included only three phases of innovation. According to Utterback (1971), these phases were: 1) idea generation, 2) problem solving, and 3) implementation.<ref>{{Cite journal|last=Utterback|first=James|year=1971|title=The Process of Technological Innovation Within the Firm|journal=Academy of Management Journal|volume=14|issue=1|page=78|doi=10.2307/254712 |jstor=254712 }}</ref> By the time one completed phase 2, one had an invention, but until one got it to the point of having an economic impact, one did not have an innovation. Diffusion was not considered a phase of innovation. Focus at this point in time was on manufacturing.

A prime example of innovation involved the boom of [[Silicon Valley]] start-ups out of the [[Stanford Industrial Park]]. In 1957, dissatisfied employees of [[Shockley Semiconductor]], the company of [[Nobel laureate]] [[William Shockley]], co-inventor of the [[transistor]], left to form an independent firm, [[Fairchild Semiconductor]]. After several years, Fairchild developed into a formidable presence in the sector.{{which|date=February 2022}} Eventually, these founders left to start their own companies based on their own unique ideas, and then leading employees started their own firms. Over the next 20 years this process resulted in the momentous [[startup company|startup-company]] explosion of [[information technology|information-technology]] firms.{{citation needed|date=February 2022}} Silicon Valley began as 65 new enterprises born out of Shockley's eight former employees.<ref>{{cite web |title=Silicon Valley History & Future |url=http://www.netvalley.com/svhistory.html |access-date=14 March 2016 |publisher=Netvalley.com}}</ref>

All organizations can innovate, including for example hospitals, universities, and local governments.<ref>{{cite journal|pmid=19104264|year=2009|last1=Salge|first1=T. O.|title=Hospital innovativeness and organizational performance: Evidence from English public acute care|journal=Health Care Management Review|volume=34|issue=1|pages=54–67|last2=Vera|first2=A.|doi=10.1097/01.HMR.0000342978.84307.80}}</ref> The organization requires a proper structure in order to retain competitive advantage. Organizations can also improve profits and performance by providing work groups opportunities and resources to innovate, in addition to employee's core job tasks.<ref>{{cite journal|last1=West|first1=Michael A.|year=2002|title=Sparkling Fountains or Stagnant Ponds: An Integrative Model of Creativity and Innovation Implementation in Work Groups|journal=Applied Psychology|volume=51|issue=3|pages=355–387|doi=10.1111/1464-0597.00951}}</ref> Executives and managers have been advised to break away from traditional ways of thinking and use change to their advantage.<ref>''MIT Sloan Management Review'' Spring 2002. "How to identify and build New Businesses"</ref> The world of work is changing with the increased use of technology and companies are becoming increasingly competitive. Companies will have to downsize or reengineer their operations to remain competitive. This will affect employment as businesses will be forced to reduce the number of people employed while accomplishing the same amount of work if not more.<ref>Anthony, Scott D.; Johnson, Mark W.; Sinfield, Joseph V.; Altman, Elizabeth J. (2008). ''Innovator's Guide to Growth''. "Putting Disruptive Innovation to Work". Harvard Business School Press. {{ISBN|978-1-59139-846-2}}.</ref>

For instance, former Mayor [[Martin O'Malley]] pushed the [[City of Baltimore]] to use [[CitiStat]], a [[Performance measurement|performance-measurement]] data and management system that allows city officials to maintain statistics on several areas from crime trends to the conditions of [[pothole]]s. This system aided in better evaluation of policies and procedures with accountability and efficiency in terms of time and money. In its first year, CitiStat saved the city $13.2 million.<ref>Perez, T. and Rushing R. (2007). [https://www.americanprogress.org/issues/general/reports/2007/04/23/2911/the-citistat-model-how-data-driven-government-can-increase-efficiency-and-effectiveness/ "The CitiStat Model: How Data-Driven Government Can Increase Efficiency and Effectiveness"]. ''Center for American Progress Report''. pp. 1–18.</ref> Even [[mass transit]] systems have innovated with [[hybrid vehicle|hybrid]] bus fleets to [[Real-time locating system|real-time tracking]] at bus stands. In addition, the growing use of [[mobile data terminal]]s in vehicles, that serve as communication hubs between vehicles and a control center, automatically send data on location, passenger counts, engine performance, mileage and other information. This tool helps to deliver and manage transportation systems.<ref>Transportation Research Board (2007). "Transit Cooperative Research Program (TCRP) Synthesis 70: Mobile Data Terminals". pp. 1–5. [http://onlinepubs.trb.org/onlinepubs/tcrp/tcrp_syn_70.pdf TCRP (PDF)].</ref>

Still other innovative strategies include [[hospital]]s digitizing medical information in [[electronic medical records]]. For example, the [[United States Department of Housing and Urban Development|U.S. Department of Housing and Urban Development]]'s [[HOPE VI]] initiatives turned severely distressed [[public housing]] in urban areas into [[Urban renewal|revitalized]], mixed-income environments; the [[Harlem Children's Zone]] used a community-based approach to educate local area children; and the [[U.S. Environmental Protection Agency|Environmental Protection Agency]]'s [[Brownfield regulation and development|brownfield grants]] facilitates turning over [[brownfield]]s for [[environmental protection]], [[Open space reserve|green spaces]], [[Community development|community]] and [[Commerce|commercial development]].
{{Further|Demand articulation}}

=== Sources of innovation ===
Innovation may occur due to effort from a range of different agents, by chance, or as a result of a major system failure. According to [[Peter F. Drucker]], the general sources of innovations are changes in industry structure, in market structure, in local and global demographics, in human perception, in the amount of available scientific knowledge, etc.<ref name="Drucker" />

[[File:Linear model of innovation.svg|thumb|Original model of three phases of the process of Technological Change]]
In the simplest [[linear model of innovation]] the traditionally recognized source is ''manufacturer innovation''. This is where a person or business innovates in order to sell the innovation.

Another source of innovation is ''end-user innovation''. This is where a person or company develops an innovation for their own (personal or in-house) use because existing products do not meet their needs. [[Massachusetts Institute of Technology|MIT]] economist [[Eric von Hippel]] identified end-user innovation as the most important source in his classic book on the subject, ''"The Sources of Innovation"''.<ref>{{cite book |url=http://web.mit.edu/evhippel/www/books/sources/SofI.pdf |title=The Sources of Innovation |last=Von Hippel |first=Eric |author-link=Eric von Hippel |publisher=[[Oxford University Press]] |year=1988  |archive-url=https://web.archive.org/web/20061012160410/http://web.mit.edu/evhippel/www/books/sources/SofI.pdf |archive-date=12 October 2006 |access-date=3 December 2015}}</ref>

The robotics engineer [[Joseph F. Engelberger]] asserts that innovations require only three things:
# a recognized need
# competent people with relevant technology
# financial support<ref>Engelberger, J. F. (1982). "Robotics in practice: Future capabilities". ''Electronic Servicing & Technology'' magazine.</ref>

The Kline [[chain-linked model]] of innovation<ref>Kline (1985). ''Research, Invention, Innovation and Production: Models and Reality, Report INN-1'', March 1985, Mechanical Engineering Department, Stanford University.</ref> places emphasis on potential market needs as drivers of the innovation process, and describes the complex and often iterative feedback loops between marketing, design, manufacturing, and R&D.

In the 21st century the [[Islamic State]] (IS) movement, while decrying [[Bidʻah|religious innovation]]s, has innovated in military tactics, recruitment, [[ideology]] and geopolitical activity.<ref>{{cite book |last1=Hashim |first1=Ahmed S. |title=The Caliphate at War: The Ideological, Organisational and Military Innovations of Islamic State |publisher=Oxford University Press |year=2018 |isbn=9781849046435 |page=7}}</ref><ref>
{{cite book |last1=Scott Ligon |first1=Gina |title=Team Creativity and Innovation |last2=Derrick |first2=Douglas C. |last3=Harms |first3=Mackenzie |date=15 November 2017 |publisher=Oxford University Press |isbn=9780190695323 |editor-last1=Reiter-Palmon |editor-first1=Roni |chapter=Destruction Through Collaboration: How Terrorists Work Together Toward Malevolent Innovation}}</ref>

=== Facilitating innovation ===
Innovation by businesses is achieved in many ways, with much attention now given to formal [[research and development]] (R&D) for "breakthrough innovations". R&D help spur on patents and other scientific innovations that leads to productive growth in such areas as industry, medicine, engineering, and government.<ref name="MetroPolicy">Mark, M., Katz, B., Rahman, S., and Warren, D. (2008) [https://www.brookings.edu/research/metropolicy-shaping-a-new-federal-partnership-for-a-metropolitan-nation/ ''MetroPolicy: Shaping A New Federal Partnership for a Metropolitan Nation'']. Brookings Institution: Metropolitan Policy Program Report. pp. 4–103.</ref> Yet, innovations can be developed by less formal on-the-job modifications of practice, through exchange and combination of professional experience and by many other routes. Investigation of relationship between the concepts of innovation and technology transfer revealed overlap.<ref>{{cite journal |url=https://www.researchgate.net/publication/286542154 |title=Perspectives on Innovation and Technology Transfer |journal=Procedia - Social and Behavioral Sciences |volume=213 |pages=965–970 |last=Dubickis, M. |first=Gaile-Sarkane, E. |year=2015 |doi=10.1016/j.sbspro.2015.11.512 |doi-access=free }}</ref> The more radical and revolutionary innovations tend to emerge from R&D, while more incremental innovations may emerge from practice – but there are many exceptions to each of these trends.

[[Information technology]] and changing business processes and management style can produce a work climate favorable to innovation.<ref>{{cite web|url=http://forbesindia.com/article/ie/new-trends-in-innovation-management/33905/1 |website=Forbesindia.com |publisher=Forbes India Magazine |title= New Trends in Innovation Management |access-date=14 March 2016}}</ref> For example, the software tool company [[Atlassian]] conducts quarterly "ShipIt Days" in which employees may work on anything related to the company's products.<ref>{{cite web|url=https://www.atlassian.com/company/about/shipit |title=ShipIt Days |publisher=Atlassian |access-date=14 March 2016}}</ref> Google employees work on self-directed projects for 20% of their time (known as [[Innovation Time Off]]). Both companies cite these bottom-up processes as major sources for new products and features.

An important innovation factor includes customers buying products or using services. As a result, organizations may incorporate users in [[focus group]]s (user centered approach), work closely with so-called [[lead users]] (lead user approach), or users might adapt their products themselves. The lead user method focuses on idea generation based on leading users to develop breakthrough innovations. U-STIR, a project to innovate [[Europe]]'s surface [[transportation]] system, employs such workshops.<ref>{{cite web |url=http://www.u-stir.eu/index.phtml?id=2537&ID1=2537&sprache=en |title=U-STIR |publisher=U-stir.eu |access-date=7 September 2011  |archive-url=https://web.archive.org/web/20110918055455/http://www.u-stir.eu/index.phtml?id=2537&ID1=2537&sprache=en |archive-date=18 September 2011}}</ref> Regarding this [[user innovation]], a great deal of innovation is done by those actually implementing and using technologies and products as part of their normal activities. Sometimes user-innovators may become [[entrepreneur]]s, selling their product, they may choose to trade their innovation in exchange for other innovations, or they may be adopted by their suppliers. Nowadays, they may also choose to freely reveal their innovations, using methods like [[Open-source model|open source]]. In such networks of innovation the users or communities of users can further develop technologies and reinvent their social meaning.<ref>Tuomi, I. (2002). ''Networks of Innovation''. Oxford University Press. [http://www.oup.com/uk/catalogue/?ci=9780199256983 Networks of Innovation] {{webarchive|url=https://web.archive.org/web/20071105071932/http://www.oup.com/uk/catalogue/?ci=9780199256983 |date=5 November 2007 }}</ref><ref>Siltala, R. (2010). [https://www.linkedin.com/pulse/innovativity-cooperative-learning-business-life-teaching-siltala ''Innovativity and cooperative learning in business life and teaching'']. PhD thesis. University of Turku.</ref>

One technique for innovating a solution to an identified problem is to actually attempt an experiment with many possible solutions.<ref>[https://medium.com/the-mission/forget-about-the-10-000-hour-rule-7b7a39343523 Forget The 10,000-Hour Rule; Edison, Bezos, & Zuckerberg Follow The 10,000-Experiment Rule]. Medium.com (26 October 2017). Retrieved 16 October 2018.</ref> This technique was famously used by [[Thomas Edison|Thomas Edison's]] laboratory to find a version of the [[incandescent light bulb]] economically viable for home use, which involved searching through thousands of possible [[electrical filament|filament]] designs before settling on carbonized bamboo.

This technique is sometimes used in pharmaceutical [[drug discovery]]. Thousands of chemical compounds are subjected to [[high-throughput screening]] to see if they have any activity against a target molecule which has been identified as biologically significant to a disease. Promising compounds can then be studied; modified to improve efficacy and reduce side effects, evaluated for cost of manufacture; and if successful turned into treatments.

The related technique of [[A/B testing]] is often used to help optimize the design of [[web site]]s and [[mobile app]]s.  This is used by major sites such as [[amazon.com]], [[Facebook]], [[Google]], and [[Netflix]].<ref name="fastcompany">[https://www.fastcompany.com/3063846/why-these-tech-companies-keep-running-thousands-of-failed Why These Tech Companies Keep Running Thousands Of Failed Experiments]. Fast Company.com (21 September 2016). Retrieved 16 October 2018.</ref> [[Procter & Gamble]] uses computer-simulated products and online user panels to conduct larger numbers of experiments to guide the design, packaging, and shelf placement of consumer products.<ref>[https://www.bcgperspectives.com/content/articles/strategy_consumer_products_simulation_advantage/ Simulation Advantage]. Bcgperspectives.com (4 August 2010). Retrieved 16 October 2018.</ref> [[Capital One]] uses this technique to drive credit card marketing offers.<ref name="fastcompany" />

== Goals and failures of innovation ==
Scholars have argued that the main purpose for innovation today is [[profit maximization]] and [[Valorisation|capital valorisation]].<ref>{{Cite journal |last=MacKenzie |first=Donald |date=1984 |title=Marx and the Machine |url=https://www.jstor.org/stable/3104202 |journal=Technology and Culture |volume=25 |issue=3 |pages=473–502 |doi=10.2307/3104202 |jstor=3104202 |s2cid=113106929 |issn=0040-165X}}</ref><ref name=":6"/> Consequently, programs of organizational innovation are typically tightly linked to organizational goals and growth objectives, to the [[business plan]], and to [[Market (economics)|market]] [[Competition (companies)|competitive positioning]].  Davila et al. (2006) note, "Companies cannot grow through cost reduction and reengineering alone... Innovation is the key element in providing aggressive top-line growth, and for increasing bottom-line results".<ref name="Making Innovation Work">Davila, T., Epstein, M. J., and Shelton, R. (2006). "Making Innovation Work: How to Manage It, Measure It, and Profit from It." Upper Saddle River: Wharton School Publishing.</ref> One survey across a large number of manufacturing and services organizations found that systematic programs of organizational innovation are most frequently driven by: improved [[quality (business)|quality]], creation of new [[Market (economics)|market]]s, extension of the [[product (business)|product]] range, reduced [[labor cost]]s, improved [[production process]]es, reduced materials cost, reduced [[environmental damage]], replacement of [[product (business)|product]]s/[[Service (economics)|services]], reduced [[energy]] consumption, and conformance to [[regulation]]s.<ref name="Making Innovation Work" />

Different goals are appropriate for different products, processes, and services. According to Andrea Vaona and Mario Pianta, some example goals of innovation could stem from two different types of technological strategies: ''technological competitiveness'' and ''active price competitiveness''. ''Technological competitiveness'' may have a tendency to be pursued by smaller firms and can be characterized as "efforts for market-oriented innovation, such as a strategy of market expansion and patenting activity."<ref name=":3">{{Cite journal|last1=Vaona|first1=Andrea|last2=Pianta|first2=Mario|date=March 2008|title=Firm Size and Innovation in European Manufacturing|url=http://link.springer.com/10.1007/s11187-006-9043-9|journal=Small Business Economics|language=en|volume=30|issue=3|pages=283–299|doi=10.1007/s11187-006-9043-9|issn=0921-898X|hdl=10419/3843|s2cid=153525567|hdl-access=free}}</ref> On the other hand, ''active price competitiveness'' is geared toward process innovations that lead to efficiency and flexibility, which tend to be pursued by large, established firms as they seek to expand their market foothold.<ref name=":3" />  Whether innovation goals are successfully achieved or otherwise depends greatly on the environment prevailing in the organization.<ref>{{cite journal|doi=10.1287/mnsc.35.5.597|title=Innovative and Noninnovative Small Firms: Types and Characteristics|journal=Management Science|volume=35|issue=5|pages=597–606|year=1989|last1=Khan|first1=Arshad M.|last2=Manopichetwattana|first2=V.}}</ref>

=== Organization-internal innovation failures ===
Failure of organizational innovation programs has been widely researched and the causes vary considerably. Some causes are external to the organization and outside its influence of control. Others are internal and ultimately within the control of the organization. Internal causes of failure can be divided into causes associated with the cultural infrastructure and causes associated with the innovation process itself. David O'Sullivan wrote that causes of failure within the innovation process in most organizations can be distilled into five types: poor goal definition, poor alignment of actions to goals, poor participation in teams, poor monitoring of results, and poor communication and [[access to information]].<ref>{{cite journal|author=O'Sullivan, David |year=2002|title=Framework for Managing Development in the Networked Organisations|journal=Journal of Computers in Industry|volume= 47|issue=1|pages=77–88|doi=10.1016/S0166-3615(01)00135-X}}</ref>

=== Environmental and social innovation failures ===
Innovation is generally framed as an inherently positive force, delivering growth and prosperity for all, and is often deemed as both inevitable and unstoppable.<ref name=":6"/> In this sense, future innovations are often hailed as solutions to current problems, such as [[climate change]]. This business-as-usual approach would mean continued and increased [[globalization]] as well as quick innovation cycles which supposedly will maximize the competitiveness of processes, in the end leading to [[Eco-economic decoupling]] or [[Green growth]]. Yet, it is unclear whether innovative solutions will be capable of solving the climate crisis: According to Mario Giampietro and [[Silvio Funtowicz]] (2020), this positive framing of innovation "demonstrates [a] lack of understanding of the biophysical roots of the economic process and the seriousness of the sustainability crisis".<ref>{{Cite journal |last1=Giampietro |first1=Mario |last2=Funtowicz |first2=Silvio O. |date=2020-07-01 |title=From elite folk science to the policy legend of the circular economy |url=https://www.sciencedirect.com/science/article/pii/S1462901120302033 |journal=Environmental Science & Policy |volume=109 |pages=64–72 |doi=10.1016/j.envsci.2020.04.012 |issn=1462-9011|doi-access=free |hdl=11250/2730163 |hdl-access=free }}</ref> This is due to the fact that innovation can be understood in its specific historic and cultural context: The prevailing hegemonic view on innovation, as emphasized by Ben Robra et al. (2023), aligns closely with capitalist mode of production, shown by the mantra of 'innovate or die.'<ref name=":6">{{Cite journal |last1=Robra |first1=Ben |last2=Pazaitis |first2=Alex |last3=Giotitsas |first3=Chris |last4=Pansera |first4=Mario |date=2023-07-01 |title=From creative destruction to convivial innovation - A post-growth perspective |url=https://www.sciencedirect.com/science/article/pii/S0166497223000718 |journal=Technovation |volume=125 |pages=102760 |doi=10.1016/j.technovation.2023.102760 |issn=0166-4972|doi-access=free |hdl=11093/4788 |hdl-access=free }}</ref> From this viewpoint, innovation is primarily driven by the imperative of capital accumulation, serving the sole purpose of increasing returns, neglecting societal needs such as a clean environment or [[social equality]] and in general the biophysical limits of our planet.<ref>{{Cite journal |last1=Hoekstra |first1=Arjen Y. |last2=Wiedmann |first2=Thomas O. |date=2014-06-06 |title=Humanity's unsustainable environmental footprint |url=https://www.science.org/doi/10.1126/science.1248365 |journal=Science |language=en |volume=344 |issue=6188 |pages=1114–1117 |doi=10.1126/science.1248365 |pmid=24904155 |bibcode=2014Sci...344.1114H |s2cid=206553617 |issn=0036-8075}}</ref><ref>{{Cite journal |last1=Rockström |first1=Johan |last2=Steffen |first2=Will |last3=Noone |first3=Kevin |last4=Persson |first4=Åsa |last5=Chapin |first5=F. Stuart |last6=Lambin |first6=Eric F. |last7=Lenton |first7=Timothy M. |last8=Scheffer |first8=Marten |last9=Folke |first9=Carl |last10=Schellnhuber |first10=Hans Joachim |last11=Nykvist |first11=Björn |last12=de Wit |first12=Cynthia A. |last13=Hughes |first13=Terry |last14=van der Leeuw |first14=Sander |last15=Rodhe |first15=Henning |date=September 2009 |title=A safe operating space for humanity |url=https://www.nature.com/articles/461472a |journal=Nature |language=en |volume=461 |issue=7263 |pages=472–475 |doi=10.1038/461472a |pmid=19779433 |bibcode=2009Natur.461..472R |issn=0028-0836}}</ref>

==Diffusion==
[[File:InnovationLifeCycle.jpg|thumb|right]]
{{main|Diffusion of innovations}}

Diffusion of innovation research was first started in 1903 by seminal researcher [[Gabriel Tarde]], who first plotted the S-shaped [[diffusion curve]]. Tarde defined the innovation-decision process as a series of steps that include:<ref>Tarde, G.  (1903). ''The laws of imitation'' (E. Clews Parsons, Trans.). New York: H. Holt & Co.</ref>
# knowledge
# forming an attitude
# a decision to adopt or reject
# implementation and use
# confirmation of the decision

Once innovation occurs, innovations may be spread from the innovator to other individuals and groups. This process has been proposed that the lifecycle of innovations can be described using the '[[Sigmoid function|s-curve]]' or [[Diffusion of innovations|diffusion curve]]. The s-curve maps growth of revenue or productivity against time. In the early stage of a particular innovation, growth is relatively slow as the new product establishes itself. At some point, customers begin to demand and the product growth increases more rapidly. New incremental innovations or changes to the product allow growth to continue. Towards the end of its lifecycle, growth slows and may even begin to decline. In the later stages, no amount of new investment in that product will yield a normal rate of return.

The s-curve derives from an assumption that new products are likely to have "product life" – i.e., a start-up phase, a rapid increase in revenue and eventual decline. In fact, the great majority of innovations never get off the bottom of the curve, and never produce normal returns.

Innovative companies will typically be working on new innovations that will eventually replace older ones. Successive s-curves will come along to replace older ones and continue to drive growth upwards. In the figure above the first curve shows a current technology. The second shows an [[emerging technologies|emerging technology]] that currently yields lower growth but will eventually overtake current technology and lead to even greater levels of growth. The length of life will depend on many factors.<ref>Rogers, E. M. (1962). ''Diffusion of Innovation''. New York, NY: Free Press.</ref>

==Measuring innovation==
Measuring innovation is inherently difficult as it implies commensurability so that comparisons can be made in quantitative terms. Innovation, however, is by definition novelty. Comparisons are thus often meaningless across products or service.<ref>{{Cite book|title=The Oxford handbook of innovation|date=2005|publisher=Oxford University Press|others=Fagerberg, Jan., Mowery, David C., Nelson, Richard R.|isbn=978-0-19-926455-1|location=Oxford|oclc=56655392}}</ref> Nevertheless, Edison et al.<ref name="Henry2013">{{cite journal|last1=Edison|first1=H.|last2=Ali|first2=N.B.|last3=Torkar|first3=R.|year=2013|title=Towards innovation measurement in the software industry|url=https://www.researchgate.net/publication/256991991|journal=Journal of Systems and Software|volume=86|issue=5|pages=1390–1407|doi=10.1016/j.jss.2013.01.013|via=ResearchGate}}</ref> in their review of literature on [[innovation management]] found 232 innovation metrics. They categorized these measures along five dimensions; i.e. inputs to the innovation process, output from the innovation process, effect of the innovation output, measures to access the activities in an innovation process and availability of factors that facilitate such a process.<ref name="Henry2013" />

There are two different types of measures for innovation: the organizational level and the political level.

=== Organizational-level ===
:The measure of innovation at the organizational level relates to individuals, team-level assessments, and private companies from the smallest to the largest company. Measure of innovation for organizations can be conducted by surveys, workshops, consultants, or internal benchmarking. There is today no established general way to measure organizational innovation. Corporate measurements are generally structured around [[balanced scorecard]]s which cover several aspects of innovation such as business measures related to finances, innovation process efficiency, employees' contribution and motivation, as well benefits for customers. Measured values will vary widely between businesses, covering for example new product revenue, spending in R&D, time to market, customer and employee perception & satisfaction, number of patents, additional sales resulting from past innovations.<ref>Davila, Tony; Marc J. Epstein and Robert Shelton (2006). ''Making Innovation Work: How to Manage It, Measure It, and Profit from It''. Upper Saddle River: Wharton School Publishing</ref>

=== Political-level ===
:For the political level, measures of innovation are more focused on a country or region [[competitive advantage]] through innovation. In this context, organizational capabilities can be evaluated through various evaluation frameworks, such as those of the European Foundation for Quality Management. The [[OECD]] Oslo Manual (1992) suggests standard guidelines on measuring technological product and process innovation. Some people consider the [[Oslo Manual]] complementary to the [[Frascati Manual]] from 1963. The new Oslo Manual from 2018 takes a wider perspective to innovation, and includes marketing and organizational innovation. These standards are used for example in the European [[Community Innovation Survey]]s.<ref>OECD The Measurement of Scientific and Technological Activities. Proposed Guidelines for Collecting and Interpreting Technological Innovation Data. Oslo Manual. 2nd edition, DSTI, OECD / European Commission Eurostat, Paris 31 December 1995.</ref>

Other ways of measuring innovation have traditionally been expenditure, for example, investment in R&D (Research and Development) as percentage of GNP (Gross National Product). Whether this is a good measurement of innovation has been widely discussed and the Oslo Manual has incorporated some of the critique against earlier methods of measuring. The traditional methods of measuring still inform many policy decisions. The EU [[Lisbon Strategy]] has set as a goal that their average expenditure on R&D should be 3% of GDP.<ref>{{cite web |url=http://ec.europa.eu/enterprise/policies/innovation/ |title=Industrial innovation – Enterprise and Industry |publisher=European Commission |access-date=7 September 2011  |archive-url=https://web.archive.org/web/20110827125633/http://ec.europa.eu/enterprise/policies/innovation/ |archive-date=27 August 2011}}</ref>

===Indicators===
Many scholars claim that there is a great bias towards the "science and technology mode" (S&T-mode or STI-mode), while the "learning by doing, using and interacting mode" (DUI-mode) is ignored and measurements and research about it rarely done. For example, an institution may be high tech with the latest equipment, but lacks crucial doing, using and interacting tasks important for innovation.<ref>{{Cite web|title=DEVELOPMENT OF INNOVATION - European Journal of Natural History (scientific magazine)|url=https://world-science.ru/en/article/view?id=33506|access-date=2021-04-07|website=world-science.ru}}</ref>

A common industry view (unsupported by empirical evidence) is that comparative [[cost-effectiveness]] research is a form of [[price controls|price control]] which reduces returns to industry, and thus limits R&D expenditure, stifles future innovation and compromises new products access to markets.<ref>{{cite journal|pmid=19523121|pmc=2881450|year=2009|last1=Chalkidou|first1=K.|title=Comparative effectiveness research and evidence-based health policy: Experience from four countries|journal=The Milbank Quarterly|volume=87|issue=2|pages=339–67|last2=Tunis|first2=S.|last3=Lopert|first3=R.|last4=Rochaix|first4=L.|last5=Sawicki|first5=P. T.|last6=Nasser|first6=M.|last7=Xerri|first7=B.|doi=10.1111/j.1468-0009.2009.00560.x}}</ref>
Some academics claim cost-effectiveness research is a valuable value-based measure of innovation which accords "truly significant" therapeutic advances (i.e. providing "health gain") higher prices than free market mechanisms.<ref>{{cite journal |last1=Roughead |first1=E. |last2=Lopert |first2=R. |last3=Sansom |first3=L. |title=Prices for innovative pharmaceutical products that provide health gain: a comparison between Australia and the United States |journal=Value in Health |year=2007 |volume=10 |issue=6 |pages=514–20 |doi=10.1111/j.1524-4733.2007.00206.x |pmid=17970935 |doi-access=free }}</ref> Such [[value-based pricing]] has been viewed as a means of indicating to industry the type of innovation that should be rewarded from the public purse.<ref>{{cite journal |last=Hughes |first=B. |title=Payers Growing Influence on R&D Decision Making |journal=Nature Reviews Drug Discovery |year=2008 |volume=7 |issue= 11|pages=876–78 |doi=10.1038/nrd2749 |pmid=18974741 |s2cid=10217053 }}</ref>

An Australian academic developed the case that national comparative [[cost-effectiveness analysis]] systems should be viewed as measuring "health innovation" as an [[evidence-based policy]] concept for valuing innovation distinct from valuing through competitive markets, a method which requires strong [[anti-trust]] laws to be effective, on the basis that both methods of assessing [[pharmaceutical innovations]] are mentioned in annex 2C.1 of the [[AUSFTA|Australia-United States Free Trade Agreement]].<ref>{{cite journal |last1=Faunce |first1=T. |last2=Bai |first2=J. |last3=Nguyen |first3=D. |title=Impact of the Australia-US Free Trade Agreement on Australian medicines regulation and prices |journal=[[Journal of Generic Medicines]] |year=2010 |volume=7 |issue=1 |pages=18–29 |doi=10.1057/jgm.2009.40 |s2cid=154433476 |url=https://openresearch-repository.anu.edu.au/bitstream/1885/51254/9/Faunce_Journal_Evidence_JGM.pdf.jpg |archive-url=https://web.archive.org/web/20210416220209/https://openresearch-repository.anu.edu.au/bitstream/1885/51254/9/Faunce_Journal_Evidence_JGM.pdf.jpg |archive-date=2021-04-16 |url-status=live }}</ref><ref>{{cite web|author=Faunce TA|title=Global intellectual property protection of 'innovative' pharmaceuticals: Challenges for bioethics and health law in B Bennett and G Tomossy|website=Law.anu.edu.au|publisher=Globalization and Health Springer|year=2006|url=http://law.anu.edu.au/StaffUploads/236-Ch%20Globalisation%20and%20Health%20Fau.pdf|access-date=18 June 2009|archive-url=https://web.archive.org/web/20110414040804/http://law.anu.edu.au/StaffUploads/236-Ch%20Globalisation%20and%20Health%20Fau.pdf|archive-date=14 April 2011}}</ref><ref>{{cite journal |last=Faunce |first=T. A. |title=Reference pricing for pharmaceuticals: is the Australia-United States Free Trade Agreement affecting Australia's Pharmaceutical Benefits Scheme? |journal=Medical Journal of Australia |year=2007 |volume=187 |issue=4 |pages=240–42|pmid=17564579 |doi=10.5694/j.1326-5377.2007.tb01209.x |s2cid=578533 }}</ref>

===Indices===
Several indices attempt to measure innovation and rank entities based on these measures, such as:
* [[Bloomberg Innovation Index]]
* "Bogota Manual"<ref>{{cite web |url=http://www.ricyt.org/index.php?option=com_docman&task=doc_download&gid=149&Itemid=2 |title=Bogota Manual. Standardisation of Indicators of Technological Innovation in Latin American and Caribbean Countries |author=Hernán Jaramillo |author2=Gustavo Lugones |author3=Mónica Salazar |date=March 2001 |publisher=Iberoamerican Network of Science and Technology Indicators (RICYT) Organisation of American States (OAS) / CYTED PROGRAM COLCIENCIAS/OCYT |page=87 |language=en}}</ref> similar to the Oslo Manual, is focused on Latin America and the Caribbean countries.{{citation needed|date=February 2016}}
* "Creative Class" developed by [[Richard Florida]]{{citation needed|date=February 2016}}
* [[EIU Innovation Ranking]]<ref>{{Cite news|title=Social Innovation Index 2016|url=https://eiuperspectives.economist.com/technology-innovation/old-problems-new-solutions-measuring-capacity-social-innovation-across-world-0|access-date=2021-04-07|newspaper=Economist Impact &#124; Perspectives|language=en}}</ref>
* [[Global Competitiveness Report]]
* [[Global Innovation Index]] (GII), by [[INSEAD]]<ref>{{cite web|website=INSEAD|url=http://knowledge.insead.edu/entrepreneurship-innovation/global-innovation-index-2930|title=The INSEAD Global Innovation Index (GII)|date=28 October 2013}}</ref>
* [[Information Technology and Innovation Foundation|Information Technology and Innovation Foundation (ITIF) Index]]
* [https://tcdata360.worldbank.org/subtopics/inn?country=USA Innovation 360] – From the World Bank. Aggregates innovation indicators (and more) from a number of different public sources
* Innovation Capacity Index (ICI) published by a large number of international professors working in a collaborative fashion. The top scorers of ICI 2009–2010 were: 1. Sweden 82.2; 2. Finland 77.8; and 3. United States 77.5<ref>{{cite web|website=Innovation Capacity Index|title=Home page|url=http://www.innovationfordevelopmentreport.org/ici.html}}</ref>
* Innovation Index, developed by the [[Indiana Business Research Center]], to measure innovation capacity at the county or regional level in the United States<ref>{{cite web|url=http://www.statsamerica.org/innovation/data.html |title=Tools |publisher=Statsamerica.org |access-date=7 September 2011}}</ref>
* Innovation Union Scoreboard, developed by the [[European Union]]
* [[innovationsindikator]] for Germany, developed by the [[:de:Bundesverband der Deutschen Industrie|Federation of German Industries]] (Bundesverband der Deutschen Industrie) in 2005<ref>[http://www.innovationsindikator.de Innovations Indikator] retrieved 7 March 2017</ref>
* [[INSEAD]] Innovation Efficacy Index<ref>{{cite news|url=https://www.technologyreview.com/s/511446/the-innovation-efficiency-index/|work=Technology Review|title=The INSEAD Innovation Efficiency Inndex|date=February 2016}}</ref>
* [[International Innovation Index]], produced jointly by [[The Boston Consulting Group]], the [[National Association of Manufacturers]] (NAM) and its nonpartisan research affiliate The Manufacturing Institute, is a worldwide index measuring the level of innovation in a country; NAM describes it as the "largest and most comprehensive global index of its kind"{{citation needed|date=February 2016}}<ref>{{Cite journal|last=Adsule|first=Anil|year=2015|title=INNOVATION LEADING THE WAY TO REVOLUTION|url=http://msmspune.com/images_New/Research/pepars/2015/02-2015-Dr.Joe_Lopez.pdf |archive-url=https://web.archive.org/web/20200801213556/http://msmspune.com/images_New/Research/pepars/2015/02-2015-Dr.Joe_Lopez.pdf |archive-date=2020-08-01 |url-status=live|journal=International Journal of Business and Administration Research Review|volume= 2, Issue.11|via=Google scholar}}</ref>
* Management Innovation Index – Model for Managing Intangibility of Organizational Creativity: Management Innovation Index<ref>{{Cite book|chapter=Model for Managing Intangibility of Organizational Creativity: Management Innovation Index|pages= 1300–1307|author=Kerle, Ralph |title=Encyclopedia of Creativity, Invention, Innovation and Entrepreneurship |doi=10.1007/978-1-4614-3858-8_35|year = 2013|isbn = 978-1-4614-3857-1}}</ref>
* NYCEDC Innovation Index, by the New York City Economic Development Corporation, tracks New York City's "transformation into a center for high-tech innovation. It measures innovation in the City's growing science and technology industries and is designed to capture the effect of innovation on the City's economy"<ref>{{cite web|website=NYCEDC.com|url=http://www.nycedc.com/economic-data/innovation-index|title=Innovation Index}}</ref>
* OECD [[Oslo Manual]] is focused on North America, Europe, and other rich economies
* State Technology and Science Index, developed by the [[Milken Institute]], is a U.S.-wide benchmark to measure the science and technology capabilities that furnish high paying jobs based around key components<ref>{{cite web|url=http://statetechandscience.org/|website=statetechandscience.org|title=Home page}}</ref>
* [[World Competitiveness Scoreboard]]<ref>{{cite web |url= http://www.imd.org/uupload/IMD.WebSite/wcc/WCYResults/1/scoreboard_2014.pdf |archive-url=https://web.archive.org/web/20140630000343/http://www.imd.org/uupload/IMD.WebSite/wcc/WCYResults/1/scoreboard_2014.pdf |archive-date=2014-06-30 |url-status=live|website=IMD.org|year=2014 |title=The World Competitiveness Scoreboard 2014}}</ref>

===Rankings===
Common areas of focus include: [[high-tech]] companies, [[manufacturing]], [[patent]]s, [[post secondary education]], [[research and development]], and research personnel. The left ranking of the top 10 countries below is based on the 2020 [[Bloomberg Innovation Index]].<ref>{{Cite news|title=Germany Breaks Korea's Six-Year Streak as Most Innovative Nation|publisher=Bloomberg L.P.|url=https://www.bloomberg.com/news/articles/2020-01-18/germany-breaks-korea-s-six-year-streak-as-most-innovative-nation|access-date=17 March 2021}}</ref> However, studies may vary widely; for example the [[Global Innovation Index]] 2016 ranks [[Switzerland]] as number one wherein countries like [[South Korea]], [[Japan]], and [[China]] do not even make the top ten.<ref>{{cite web|url=https://de.statista.com/infografik/5509/die-10-innovativsten-laender-weltweit-nach-dem-global-innovation-index/|title=Infografik: Schweiz bleibt globaler Innovationsführer|website=Statista Infografiken|publisher=Statista (In German)|access-date=25 November 2016}}</ref>

{{Columns-start|width=50%}}
{| class="wikitable" style="width: 15%;"
|+[[Bloomberg Innovation Index]] 2021<ref name="Bloomberg 2021">{{cite news |last1=Jamrisko |first1=Michelle |last2=Lu |first2=Wei |last3=Tanzi |first3=Alexandre |title=South Korea Leads World in Innovation as U.S. Exits Top Ten |url=https://www.bloomberg.com/news/articles/2021-02-03/south-korea-leads-world-in-innovation-u-s-drops-out-of-top-10 |work=Bloomberg |date=3 February 2021}}</ref>
! Rank !! Country/Territory
!Index
|-
| 1 || style="text-align: left" | {{flagcountry|South Korea}}
|90.49
|-
| 2 || style="text-align: left" | {{flagcountry|Singapore}}
|87.76
|-
| 3 || style="text-align: left" | {{flagcountry|Switzerland}}
|87.60
|-
| 4 || style="text-align: left" | {{flagcountry|Germany}}
|86.45
|-
| 5 || style="text-align: left" | {{flagcountry|Sweden}}
|86.39
|-
| 6 || style="text-align: left" | {{flagcountry|Denmark}}
|86.12
|-
| 7 || style="text-align: left" | {{flagcountry|Israel}}
|85.50
|-
| 8 || style="text-align: left" | {{flagcountry|Finland}}
|84.86
|-
| 9 || style="text-align: left" | {{flagcountry|Netherlands}}
|84.29
|-
| 10 || style="text-align: left" | {{flagcountry|Austria}}
|83.93
|}
{{Column}}
{| class="wikitable" style="width: 15%;"
|+[[Global Innovation Index]] 2020<ref>{{cite web |title=GII 2020 Report |url=https://www.globalinnovationindex.org/gii-2020-report |website=Global Innovation Index |access-date=19 October 2020}}</ref>
! Rank !! Country/Territory
!Index
|-
| 1 || style="text-align: left" | {{flagcountry|Switzerland}}
|66.08
|-
| 2 || style="text-align: left" | {{flagcountry|Sweden}}
|62.47
|-
| 3 || style="text-align: left" | {{flagcountry|United States of America}}
|60.56
|-
| 4 || style="text-align: left" | {{flagcountry|United Kingdom}}
|59.78
|-
| 5 || style="text-align: left" | {{flagcountry|Netherlands}}
|58.76
|-
| 6 || style="text-align: left" | {{flagcountry|Denmark}}
|57.53
|-
| 7 || style="text-align: left" | {{flagcountry|Finland}}
|57.02
|-
| 8 || style="text-align: left" | {{flagcountry|Singapore}}
|56.61
|-
| 9 || style="text-align: left" |{{flagcountry|Germany}}
|56.55
|-
| 10 || style="text-align: left" | {{flagcountry|South Korea}}
|56.11
|}
{{Column}}
{| class="wikitable" style="width: 15%;"
|+Innovation Indicator 2020<ref>{{cite book |title=innovations indikator 2020 |date=2020 |publisher=[[Bundesverband der Deutschen Industrie]], [[Fraunhofer ISI]], [[Zentrum für Europäische Wirtschaftsforschung]] |url=http://www.innovationsindikator.de/fileadmin/content/2020/pdf/Innovationsindikator_2020-kompakt.pdf |archive-url=https://web.archive.org/web/20210408194638/http://www.innovationsindikator.de/fileadmin/content/2020/pdf/Innovationsindikator_2020-kompakt.pdf |archive-date=2021-04-08 |url-status=live |language=German}}</ref>
! Rank !! Country/Territory
!Index
|-
| 1 || style="text-align: left" | {{flagcountry|Switzerland}}
|74
|-
| 2 || style="text-align: left" | {{flagcountry|Singapore}}
|70
|-
| 3 || style="text-align: left" | {{flagcountry|Belgium}}
|60
|-
| 4 || style="text-align: left" | {{flagcountry|Germany}}
|54
|-
| 5 || style="text-align: left" | {{flagcountry|Sweden}}
|54
|-
| 6 || style="text-align: left" | {{flagcountry|Denmark}}
|52
|-
| 7 || style="text-align: left" | {{flagcountry|Ireland}}
|52
|-
| 8 || style="text-align: left" | {{flagcountry|United States}}
|52
|-
| 9 || style="text-align: left" | {{flagcountry|Austria}}
|50
|-
| 10 || style="text-align: left" | {{flagcountry|Finland}}
|50
|}
{{Columns-end}}

=== Rate of innovation ===
In 2005 [[Jonathan Huebner]], a [[physicist]] working at the [[Pentagon Building|Pentagon]]'s [[Naval Air Weapons Station China Lake|Naval Air Warfare Center]], argued on the basis of both U.S. [[patent]]s and world technological breakthroughs, per capita, that the rate of human technological innovation peaked in 1873 and has been slowing ever since.<ref name=Huebner>{{Cite journal | last1 = Huebner | first1 = J. | title = A possible declining trend for worldwide innovation | doi = 10.1016/j.techfore.2005.01.003 | journal = [[Technological Forecasting and Social Change]] | volume = 72 | issue = 8 | pages = 980–986 | year = 2005 | url = https://zenodo.org/record/1259385 }}</ref><ref>{{cite news|url=https://www.usnews.com/usnews/culture/articles/050707/7inventor.htm|title=Science: Wanna be an inventor? Don't bother|last=Hayden|first=Thomas|date=7 July 2005|work=U.S. News & World Report|access-date=10 June 2013|archive-url=https://web.archive.org/web/20131101195406/http://www.usnews.com/usnews/culture/articles/050707/7inventor.htm|archive-date=1 November 2013}}</ref> In his article, he asked "Will the level of technology reach a maximum and then decline as in the Dark Ages?"<ref name=Huebner/> In later comments to ''[[New Scientist]]'' magazine, Huebner clarified that while he believed that we will reach a rate of innovation in 2024 equivalent to that of the [[Dark Ages (historiography)|Dark Ages]], he was not predicting the reoccurrence of the Dark Ages themselves.<ref>{{cite news|last=Adler|first=Robert|title=Entering a dark age of innovation|url=https://www.newscientist.com/article/dn7616-entering-a-dark-age-of-innovation.html|access-date=30 May 2013|newspaper=New Scientist|date=2 July 2005}}</ref>

John Smart criticized the claim and asserted that [[technological singularity]] researcher [[Ray Kurzweil]] and others showed a "clear trend of acceleration, not deceleration" when it came to innovations.<ref>{{Cite journal | last1 = Smart | first1 = J. | title = Discussion of Huebner article | doi = 10.1016/j.techfore.2005.07.001 | journal = [[Technological Forecasting and Social Change]] | volume = 72 | issue = 8 | pages = 988–995 | year = 2005 }}</ref> The foundation replied to Huebner the journal his article was published in, citing [[Second Life]] and [[eHarmony]] as proof of accelerating innovation; to which Huebner replied.<ref>{{cite journal|last1=Huebner|first1=Jonathan|title=Response by the Authors|journal=[[Technological Forecasting and Social Change]]|volume=72|issue=8|pages=995–1000|doi=10.1016/j.techfore.2005.05.008|year=2005}}</ref>
However, Huebner's findings were confirmed in 2010 with [[U.S. Patent Office]] data.<ref>{{Cite journal | last1 = Strumsky | first1 = D. | last2 = Lobo | first2 = J. | last3 = Tainter | first3 = J. A. | doi = 10.1002/sres.1057 | title = Complexity and the productivity of innovation | journal = Systems Research and Behavioral Science | volume = 27 | issue = 5 | page = 496 | year = 2010 | doi-access = free }}</ref> and in a 2012 paper.<ref>{{cite journal |last1=Gordon |first1=Robert J. |title=Is U.S. Economic Growth Over? Faltering Innovation Confronts the Six Headwinds |journal=NBER Working Paper No. 18315 |year=2012 |doi=10.3386/w18315 |doi-access=free }}</ref>

===Innovation and development===
The theme of innovation as a tool to disrupting patterns of poverty has gained momentum since the mid-2000s among major [[international development]] actors such as [[DFID]],<ref>{{cite web|url=https://dfid.blog.gov.uk/author/jonathan-wong-head-of-dfids-innovation-hub/ |title=Jonathan Wong, Head of DFID's Innovation Hub &#124; DFID bloggers |publisher=Government of the United Kingdom |date=24 September 2014 |access-date=14 March 2016}}</ref> [[Gates Foundation]]'s use of the [[Grand Challenge]] funding model,<ref>{{cite web|url=http://www.gatesfoundation.org/Media-Center/Press-Releases/2014/10/Gates-Foundation-Grand-Challenges-Breakthrough-Science |title=Bill & Melinda Gates Foundation and Grand Challenge Partners Commit to Innovation with New Investments in Breakthrough Science – Bill & Melinda Gates Foundation |website=Gatesfoundation.org |date=7 October 2014 |access-date=14 March 2016}}</ref> and [[USAID]]'s Global Development Lab.<ref>{{cite web|url=http://www.usaid.gov/GlobalDevLab |title=Global Development Lab &#124; U.S. Agency for International Development |website=Usaid.gov |date=5 August 2015 |access-date=14 March 2016}}</ref> Networks have been established to support innovation in development, such as D-Lab at [[MIT]].<ref>{{cite web|url=http://d-lab.mit.edu/idin |title=International Development Innovation Network (IDIN) &#124; D-Lab |website=D-lab.mit.edu |access-date=14 March 2016}}</ref> Investment funds have been established to identify and catalyze innovations in [[developing countries]], such as DFID's [[Global Innovation Fund]],<ref>{{cite web|url=https://www.gov.uk/international-development-funding/global-innovation-fund |title=Global Innovation Fund International development funding |publisher=Government of the United Kingdom |access-date=14 March 2016}}</ref> [[Human Development Innovation Fund]],<ref>{{cite web|url=http://www.hdif-tz.org |title=Human Development Innovation Fund (HDIF) |website=Hdif-tz.org |date=14 August 2015 |access-date=14 March 2016}}</ref> and (in partnership with USAID) the Global Development Innovation Ventures.<ref>{{cite web |url=http://www.usaid.gov/news-information/press-releases/usaid-and-dfid-announce-global-development-innovation-ventures |title=USAID and DFID Announce Global Development Innovation Ventures to Invest in Breakthrough Solutions to World Poverty &#124; U.S. Agency for International Development |website=Usaid.gov |date=6 June 2013 |access-date=14 March 2016 |archive-url=https://web.archive.org/web/20170504030509/https://www.usaid.gov/news-information/press-releases/usaid-and-dfid-announce-global-development-innovation-ventures |archive-date=4 May 2017  }}</ref>

The United States has to continue to play on the same level of playing field as its competitors in federal research. This can be achieved being strategically innovative through investment in basic research and science".<ref>{{Cite web|url=https://www.industryweek.com/the-economy/public-policy/article/21121160/declining-federal-research-undercuts-the-us-strategy-of-innovation|title=StackPath|website=industryweek.com|date=22 January 2020 |access-date=28 April 2020}}</ref>

==Government policies==
[[File:Charles_Herrold_laboratory_circa_1912.jpg|thumb|right|50 W. San Fernando Street in downtown San Jose is the site of the world's first [[radio broadcasting station]], created in 1909 by [[Charles Herrold]], the "Father of Broadcasting".<ref>{{cite web |url=https://bayarearadio.org/sf-radio-history/kqw |title=Bay Area Radio Museum: The Charles Herrold Story |date=12 August 2014}}</ref>]]
Given its effects on [[efficiency]], [[quality of life]], and [[productivity|productive growth]], innovation is a key driver in improving society and economy. Consequently, policymakers have worked to develop environments that will foster innovation, from funding [[research and development]] to establishing regulations that do not inhibit innovation, funding the development of innovation clusters, and using public purchasing and standardisation to 'pull' innovation through.

For instance, experts are advocating that the U.S. federal government launch a National Infrastructure Foundation, a nimble, collaborative strategic intervention organization that will house innovations programs from fragmented silos under one entity, inform federal officials on innovation [[performance measurement|performance metrics]], strengthen industry-university partnerships, and support innovation [[economic development]] initiatives, especially to strengthen [[business cluster|regional clusters]]. Because clusters are the geographic incubators of innovative products and processes, a cluster development grant program would also be targeted for implementation. By focusing on innovating in such areas as precision [[manufacturing]], [[information technology]], and [[clean energy]], other areas of national concern would be tackled including [[government debt]], [[carbon footprint]], and [[oil dependence]].<ref name="MetroPolicy"/> The U.S. [[Economic Development Administration]] understand this reality in their continued Regional Innovation Clusters initiative.<ref>{{cite web|url=http://www.eda.gov/PDF/EDA_FY_2010_Annual_Report.pdf |archive-url=https://web.archive.org/web/20110922001813/http://www.eda.gov/PDF/EDA_FY_2010_Annual_Report.pdf |archive-date=2011-09-22 |url-status=live |title=U.S. Economic Development Administration: Fiscal Year 2010 Annual Report |website=Eda.gov |access-date=14 March 2016}}</ref> The United States also has to integrate her supply-chain and improve her applies research capability and downstream process innovation.<ref>{{Cite web|url=https://americanaffairsjournal.org/2018/05/the-american-way-of-innovation-and-its-deficiencies/|title=The American Way of Innovation and Its Deficiencies|date=20 May 2018|website=American Affairs Journal|language=en-US|access-date=28 April 2020}}</ref>

Many countries recognize the importance of innovation including Japan's [[Ministry of Education, Culture, Sports, Science and Technology]] (MEXT);<ref>{{cite web |url=http://www.mext.go.jp/english/a06.htm |title=Science and Technology |publisher=MEXT |access-date=7 September 2011  |archive-url=https://web.archive.org/web/20110905171421/http://www.mext.go.jp/english/a06.htm |archive-date=5 September 2011}}</ref> Germany's [[Federal Ministry of Education and Research]];<ref>{{cite web|url=http://www.bmbf.de/en/Ministry.php |title=BMBF " Ministry |publisher=Bmbf.de |access-date=7 September 2011}}</ref> and the [[Ministry of Science and Technology of the People's Republic of China|Ministry of Science and Technology]] in the People's Republic of China. Russia's innovation programme is the [[Medvedev modernisation programme]] which aims to create a diversified economy based on high technology and innovation. The [[Government of Western Australia]] has established a number of innovation incentives for government departments. [[Landgate]] was the first Western Australian government agency to establish its Innovation Program.<ref>{{cite web|url=http://www.landgate.wa.gov.au/innovation |title=Home  |website=Landgate.wa.gov.au |publisher=Landgate Innovation Program |access-date=14 March 2016}}</ref>

Some [[regions]] have taken a proactive role in supporting innovation. Many regional governments are setting up innovation agencies to strengthen regional capabilities.<ref>Morisson, A. & Doussineau, M. (2019). Regional innovation governance and place-based policies: design, implementation and implications. Regional Studies, Regional Science,6(1),101–116. https://rsa.tandfonline.com/doi/full/10.1080/21681376.2019.1578257.</ref> [[Business incubator]]s were first introduced in 1959 and subsequently nurtured by governments around the world. Such "incubators", located close to knowledge clusters (mostly research-based) like universities or other government [[Center of excellence|excellence centre]]s – aim primarily to channel generated knowledge to applied innovation outcomes in order to stimulate regional or national [[economic growth]].<ref>
{{Cite journal |last1=Rubin |first1=Tzameret H. |last2=Aas |first2=Tor Helge |last3=Stead |first3=Andrew |date=1 July 2015 |title=Knowledge flow in Technological Business Incubators: Evidence from Australia and Israel |journal=Technovation |volume=41-42 |pages=11–24 |doi=10.1016/j.technovation.2015.03.002}}</ref>

In 2009, the municipality of [[Medellin]], [[Colombia]] created [[Ruta N]] to transform the city into a knowledge city.<ref>{{Cite journal | doi=10.1080/23792949.2018.1538702|title = Knowledge Gatekeepers and Path Development on the Knowledge Periphery: The Case of Ruta N in Medellin, Colombia| journal=Area Development and Policy|volume = 4| pages=98–115|year = 2018|last1 = Morisson|first1 = Arnault|s2cid = 169689111}}</ref>

== Counter-hegemonic views on innovation ==
Innovation in the prevailing hegemonic view today mostly refers to 'innovation under capital',<ref name=":5" /> due to the prevailing capitalist nature of the global economy. In contrast, Robra et al. (2023) propose a counter-hegemonic view on innovation.<ref name=":6" /> This alternative lens revises the centrality of capital accumulation as the primary goal of innovation. Instead of being solely driven by profit motives, a counter-hegemonic understanding sees innovation as a means to create [[Use value|user-value]], with a focus on satisfying societal needs. This view on innovation is underpinned by [[open access]] to knowledge, adaptability, repairability, and maintenance of products as well as [[Eco-sufficiency]], defining progress not by efficiency but by staying within planetary boundaries, thereby challenging the hegemonic belief in [[The Limits to Growth|limitless growth]]. This perspective is exemplified by [[Commons-based peer production|commons-based peer production (CBPP)]], offering an alternative vision of innovation that prioritizes conviviality over relentless competition. In essence, this counter-hegemonic view describes a more socially and ecologically conscious approach to innovation, striving for a balance between technological progress and human wellbeing.
{| class="wikitable"
|+Hegemonic innovation vs. counter-hegemonic innovation (taken from Robra et al., 2023)<ref name=":6" />
!
!Hegemonic view
!Counter-hegemonic view
|-
|Purpose
|Capital valorisation and profit-making/maximizing
|Use-value creation and focus on societal needs
|-
| rowspan="3" |Underpinning common senses
|Fencing off and appropriation of knowledge
|Open access to knowledge
|-
|[[Planned obsolescence]] (incl. lack of repairability by design)
|Adaptability, repairability, and maintenance
|-
|Eco-Efficiency
|Eco-Sufficiency
|}

==See also==
{{wiktionary | innovation}}
{{Div col|colwidth=30em}}
* [[Communities of innovation]]
* [[Creative problem solving]]
* [[Diffusion (anthropology)]]
* [[Ecoinnovation]]
* [[Hype cycle]]
* [[Induced innovation]]
* [[Information revolution]]
* [[Innovation leadership]]
* [[Innovation system]]
* [[International Association of Innovation Professionals]]
* [[ISO 56000]]
* [[Knowledge economy]]
* [[Obsolescence]]
* [[Open Innovation]]
* [[Open Innovations (Forum and Technology Show)]]
* [[Outcome-Driven Innovation]]
* [[Participatory design]]
* [[Product innovation]]
* [[Pro-innovation bias]]
* [[Sustainable Development Goals#Description and agenda|Sustainable Development Goals]] (Agenda 9)
* [[Technology Life Cycle]]
* [[Technological innovation system]]
* [[Theories of technology]]
* [[Timeline of historic inventions]]
* [[Toolkits for User Innovation]]
* [[UNDP Innovation Facility]]
* [[User Innovation]]
* [[Virtual product development]]
{{Div col end}}

==References==
{{Reflist|colwidth=30em}}

==Further reading==
* Bloom, Nicholas, Charles I. Jones, John Van Reenen, and Michael Webb. 2020. "[https://www.aeaweb.org/articles?id=10.1257/aer.20180338 Are Ideas Getting Harder to Find?]", ''[[American Economic Review]]'', 110 (4): 1104–44.
* {{cite book |title=Where Good Ideas Come From |author=Steven Johnson |publisher=Riverhead Books |isbn=978-1-59448-538-1 |year=2011}}
* {{cite book| title=Stretch: Unlock the Power of Less and Achieve More Than You Ever Imagined |year=2017 |first=Scott |last=Sonenshein |publisher=Harper Business |isbn=978-0-06-245722-6}}
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{{Inventions}}
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[[Category:Innovation| ]]
[[Category:Design]]
[[Category:Innovation economics]]
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[[Category:Science and technology studies]]