Marie,

Ventures should be treated like scientific experiments, which involve identifying gaps in knowledge, developing a hypothesis, designing a test, conducting the experiment, and evaluating the results. If the hypothesis is supported, further research along the same lines can be undertaken with greater confidence. If it is not, the scientist will reflect on the possible reasons and then either stop or redesign the experiment. Even a hypothesis that is not borne out can be valuable, because it offers new insights. Budget approval processes that require proponents of a new business idea to commit to a return on investment (or net present value) goal inhibit managers from approaching ventures in this fashion. Everyone is forced to focus on success or failure in achieving a specific business outcome rather than on insights arising from the hypothesis that led to the venture. It makes much more sense to focus on the option value of a venture—the value of the opportunities it may open up, not all of which are known at the outset.”

Hi Marie,

you can have a look at:

Becheikh, N., R. Landry in N. Amara. 2006. Lessons from innovation empirical studies in the manufacturing sector: a systematic review of the literature from 1993 to 2003. Technovation 26: 644–664.

Kind regards,

Marko

For 'innovation by opportunity' You may find the 'Delta Model' very useful tool.

http://pesona.mmu.edu.my/~wruslan/MISP2/Readings/detail/Reading-37.pdf

http://gk.palem.in

When I was conducting my research into innovation capability I interviewed a very successful entrepreneur and asked him "how do you innovate in your businesses?" He replied, "I avoid it if possible!" This was not the answer I was expecting (!), so I asked him "Why?" He replied, "Because it's far better to take tried and tested practices and do them well rather than faff about with lots of speculative new things". So, one answer to your question could be that successful entrepreneurs don't adopt the heady belief that 'innovation is good' and 'the more innovation the better'. They see buisness building as a craft with innovation being a possible but not essential instrument.

In Athens Greece, in my university AUEB, we recently started an incubator initiative called ACE-in (Athens Center of Entrepreneurship and Innovation - http://acein.aueb.gr/). What we have found very useful is that the participants, who are last year undergrads, masters students and young alumni, incorporate a framework such as the 10 Types of Innovation (http://www.doblin.com/tentypes) in their iterative start-up development process (lean startup applied in the incubator).   

We inspire participants to assess their venture projects in the 'Ten Types' framework; by the founding team, but also by mentors, peers, initial customers / lead users…  This 'innovativeness assessment' should be ongoing and iterative – it also happens in a 'pivoting' mode!

I don't fully understand the question. Usually, entrepreneurs are considered as innovators. This is the traditional understanding of entrepreneurs since Schumpeter. So, I am not sure I understand what you mean by "method for innovation for entrepreneurship". If you can clarify, may be I can send more information later on.

Circumstances differ and there is a great deal of literature. I would nonetheless recommend to have a look at Eric Ries "The Lean Startup". The subtitle is: How Today's Entrepreneurs Use Continuous Innovation to Create Radically Successful Businesses.

This is a promotional text, of course, but still worth trying.

TRIZ (Teoriya Resheniya Izobreatatelskikh Zadatch )

To overcome the limitations in service design tools and idea generation practices, TRIZ, a systematic problemsolving methodology, is proposed in this study to close the gaps. TRIZ was first developed by Genrich Altshuller and his colleagues in the former USSR, starting in 1946. The hypothesis of TRIZ research is that there are universal principles of invention that are the basis for creative innovation. If these principles could be identified and codified, they could be taught to people to make the process of invention more predictable. Through the analysis of more than 2 million patents, a number of innovation patterns and laws of ideality were identified. In addition, the work also reveals the following: • Problems and solutions were repeated across industries and sciences. • Patterns of technical evolution were repeated across industries and sciences. • Innovations used scientific effects outside the field where they were developed.

Startup Guru , Steve Blank's recent blog post laid out the Inventure cycle. A frame work for entrepreneurial innovation. The crux of  Inventure Cycle is it defines entrepreneurship as applied innovation, innovation as applied creativity, and creativity as applied imagination. 

Here is an Excerpt from the blog post : 

Inventure Cycle : 

Imagination is envisioning things that do not exist

Creativity is applying imagination to address a challenge

Innovation is applying creativity to generate unique solutions

Entrepreneurship is applying innovation, bringing ideas to fruition, by inspiring others’ imagination

You can read the Blog post here - http://goo.gl/IIynwC 

Earlier in the last century, an Austrian economist and political scientist Josef Schumpeter defined innovation as creating "new or improved" goods, services, procedures, methods, processes, business models or markets.   Schumpeters conceptualisation was applicable to technology and to management.  The range of innovative activities therefore run the gamut from small incremental continuous improvements in our businesses,  up to major radical or disruptive innovations.  And so the question becomes; do replicative businesses (ie those that are merely repeating previously tried and proven procedures- see Baumol) need to be innovative ?  Does the operational or business model  of a bakery, say,  need to innovate ?  To answer that question, one would need to examine whether bread-making techniques, for instance, has changed over the years.  The answer is a resounding yes.  Not only has production techniques changed but also the type of baked products which are consumed.  Yet one would think that bread-making is a replicative business.  Far from it.  Schumpeter would tell us that by a process of "creative destruction", the old ways of making bread (which he terms the incumbency) has given way to the more relevant and valuable technigues, methods, markets, products and services of bread-making (which he terms the innovating business).  Schumpeter in his early writings opined that small businesses were the crucible for innovation.  He subsequently moved to a big business position as he opined that small businesses were resource constrained and hence would not be able to innovate to the same extent as larger businesses.  However, in his later years he returned to the SME as the main driver of innovation. Hence, innovation applies to all businesses (type and size),  to all management and to all times as well.

Refer:  Schumpeter J, 1934, "The Theory of Economic Development: An inquiry into profits, capital, credit, interest and the business cycle"

I appreciated your contributions on my question. I`ll read the blogs and return after that.

Thanks a lot.

I fully agree with Silburn, but i still think some details need to be discussed. If a baker just replicates what others are doing, he is not an innovator, in the sense of Schumpeter (to answer Francis, if a company owner does not want to innovate, he is clearly not an entrepreneur). But if he adopts some incremental changes, then he may be an entrepreneur. If a baker proposed new products or adapt old ones, then he is an entrepreneur, in the sense of Schumpeter. The same is true if he adapts a new technique/technology or a new management method -- but not if he just replicates what others are doing. I have discussed and reviewed some literature on entrepreneurship in my paper in the Canadian Journal of Development Studies.

Still, my question remains. People here have discussed entrepreneurship and innovation, others have discussed (technological) innovation, but I still don't understand what "innovation in entrepreneurship" is. What Silburn and I are saying is that, by definition, ALL entreprneurship is innovative.

customer behaviuors, customer demand of services, for example, its simple  by applying customer´s  taste on food,beverages cook or producer  can inovate their menu or products.

Innovation as used in science and technology may not mean exactly the same thing as used in management and more so in entrepreneurship.  innovation is the successful realisation of new ideas.  innovation in entrepreneurship is to do with 'newness'.  The newness does not necessarily  mean the introduction of a product that has not been there before but also newness as a result of modification or feature stretching or blending.  A familiar example I take is that of mobile phone. The primary function of a mobile phone is communication but through innovation it is blended with other products such as a radio, torch, camera, alarm, clock, calendar, and so on.  So it is possible to add others such as lipstick, lighter, nail cutter, perfume.  These are innovations in entrepreneurship.

Louis Augustin-jean argues that entrepreneurship and innovation are conjoint twins. Let me pose a question. Mrs A develop a very successful business by buying stock from bankrupt firms and selling it online with a large profit margin (but no significant innovation). She retires with $50million at the age of 45. Mr B develops a new concept for helping children cross the road safely (a hand operated radar system). He spends $100,000 developing the device but can't find a distributor. He sells his house and goes to live in a rented apartment, working nights filling supermarket shelves. And the question: is Mrs A or Mr B an entrepreneur?

My answer (of course) is that its Mrs A because she is a successful exploiter of opportunities. The true test of an entrepreneur is not whether they are innovators but are they winners!

I feel I need to answer David Francis. First, I did not say that entrepreneurship and innovation are conjoint twins. Joseph Schumpeter did. Of course, it is possible to disagree with Schumpeter but then, it needs to know precisely what he was saying -- especially since he is still, 80 years after the publication of his book, the main reference for that topic. Here, the question of vocabulary and definition are crucial. And "innovation" should not be confused with "technological innovation" and with "invention".I explain.

For Schumpeter, innovation is multiform and takes one or more of the five following components: (1) The introduction of a new good; (2) the introduction of a new method of production; (3) the opening of a new market; (4) the conquest of a new source of supply; and (5) the introduction of a new organization to any industry (I copy this sentence from my article in the Canadian Journal of Development Studies). Based on that, it is difficult to argue that Ms A, who bought stocks from bankrupt firms to sell them on the internet is not an innovator. To me, her business fits with at least the third characteristics of innovation, as stated by Schumpeter.

Similarly, innovation and invention are different. Is Mr  B, who invented a new type of radar, an innovator? He is an inventor, for sure.. But it seems to me that he is not really an innovator, in the sense given by Schumpeter. An invention becomes an innovation when it finds its way in the market. If it fails to do that, it remains at the invention stage. In any case, the figures provided by David are just here to blur the issues, because you can be a successful entrepreneur (and make lots of money) or an unsuccessful one (and rent a flat), but in both cases, you are an entrepreneur. The issue here are more fundamental.

Of course, what I presented is the vision of Schumpeter and it is quite possible to criticize it. Others (including myself) have done it. I would have no problem en engage in a debate on that topic -- hope you read my article first!

Hi Marie,

The term method has several meanings in the social sciences, such as methodology, mode of inference, data collection techniques, and a few others.

It would be helpful if could you specify what do you mean by the term.

Just to support my argument, the Oxford Dictionary defines an entrepreneur as "A person who sets up a business or businesses, taking on financial risks in the hope of profit". Nothing about innovation there!

David, this is fine. But there is also a specialized literature on entrepreneurship that started 80 years ago. Then, if you disagree with it, it is also fine, but it should be based on academic arguments. For your information, the literature also separate entrepreneurs with people who take the financial risks. Sometimes these people are the same, sometimes they are not (I think of people who financed start-ups). 

I agree wholeheartedly with Louis' interpretations.  In  the Schumpeterian model an entrepreneur by definition is an innovator.  For further clarity, we must distinguish between creativity and innovation.  Two separate concepts.  So in David's scenario, Mr B is exhibiting creativity, but until the market votes positively and rewards him financially for that creativity, then he remains just an inventor.   The patent office holds many inventions that have never been "commercialised". The two acid tests that apply here are novelty and usefulness.  Unless the new or improved product , service, method, process etc are both novel and useful then there is no innovation.  If it is merely novel, it is an instantiation of creativity but not yet innovative.  What causes the "novelty" be transformed into innovativeness is its usefulness as accepted and validated by the market; i.e. commercialisation.  The entrepreneur makes that happen.  hence there is no entrepreneurship without innovation and vice versa.  In the Schumpeterian model, the entrepreneur makes innovation happen.  

By the way, back in the day,  Schumpeter's conceptualisations were viewed as radical and unorthodox.  The orthodoxy at the time had no role for an "entrepreneur" in explaining economic development.  Today, it is widely accepted that entrepreneurs are the drivers of economic development,  as without innovations, there is no possibility for the expansion of the production possibility frontier (PPF).

So when we look at the universe of business persons in an economy, not all are entrepreneurs.  Some are truly just tried and proven replicative operations; adopting and repeating systems of before.  Are they low or no risk ?   Not really !  Because they are in a crowded, common competitive space,  their operations are typically high-risk.  Are they therefore defined as "entrepreneurs" because of this risk ?  I would say not.  There is nothing new or improved.   What percentage of the population of businesses are replicative; I would suggest the vast majority.  They are merely about the business of the logistics of an economy; eg taxi service, shop-keepers, restuarants, doctors, lawyers etc.   many are small business persons.   The entrepreneurs, on the other hand, are really a minority sub-set of the population of business persons.  Replicative businesses serve to maintain the PPF.   Entrepreneurs, on the other hand, through their new and improved business activities (ie innovations) grow and expand the PPF.  

So an analogy.  Not perfect but workable and makes the point.  Lets imagine a flight of geese in their V formation.  The lead bird is forward scanning the environment and making the decisions as to how to beat the headwinds.  The birds on the flanks doing the same thing, but less so.  The rest of the flock behind the leading edges are expending less energy and benefit from the zone of low resistance in the wind shadows. The leading edge birds are the entrepreneurs; the bird on point even moreso.  They operate at the cutting edge of change and must make "new and useful" adaptations to flight (ie innovate) to survive.   The rest of the flock, the vast majority, operate behind these leaders, in a zone of minimal or no "innovation" turbulence; these are the replicative businesses.  And so to David's first point, a lot of businesses (replicative businesses) do not want to be at that leading edge.  They are very happy to work with systems that are way behind the innovation trail and just to replicate and to leave others (entrepreneurs) to do the innovating.   Is a business-person the same as an entrepreneur ?  Not necessarily.  The two are oftentimes conflated; especially by the media.   Entrepreneurs are a rare breed.   A non-innovating entrepreneur does not exist in Schumpeterian logic

Well... I also agree with Silburn. I am amazed to see how the "good old themes" in economic scholarship periodically resurface: Entrepreneurship (Schumpeter, 1934), risks, uncertainties and profits (Knight, 1921), the Flying geese model (even though Silburn has shifted the image) -- Akamatsu, 1964... That has nothing to see with the original question, but it may be the time to restore classes such as "history of economic thought", or "history of sociology" and so forth, which have been cancelled in many campuses. 

In management, there are various methods and approaches to develop innovative products and services like:

1. design thinking. eg IDEO, Article- http://hbr.org/2008/06/design-thinking/ 

2. Lead User Method by von Hippel from MIT. http://evhippel.mit.edu/teaching/ 

As a entrepreneur, for a new product development CRITICAL SURVEY based on feasibility of product in current market can be checked. For management, 'skill-based test', 'optimization tasks' may be useful in evaluating the innovation for the same.

Very true Louis, 

These topics are all intertwined.  The Akamatsu reference is revealing.  Just goggled and downloaded file attached.  Very interesting

Silburn

I have read the 1962 version bf the Flying geese model and I also knew the theory was first developed in  the 1930s (but in a specific context), but I did not know this article which I will read with great pleasure. Thanks for the referencce!

Niten Ale,

The inventure cycle may be insightful, but is that the same as "methods to innovate for an entrepreneur"? Is there a concept of "making entrepreneurship more innovative"? I would say that question fits neither the concept of Schumpter nor Kirzner. So what is it?

Frank. Yes,Marie needs to re-write her question if she wants more precise answers. I have proposed a Schumpeterian perspective in my answer because she explicitly mentioned "entrepreneurship" and "innovation" -- so I guess Kirzner is too far from what she has in mind. I have tried to analyze loopholes in both perspectives (Schumpeter and Kirzner) and then see how some bridges can be found across the two theories (and then I apply to the HK case) in my 2010 article, but again, this is not really related to her question (I guess). I did not upload the article in this website because of copyrights issues, but I can send it to interested people.

You can have a look to the attached article of mine; wishes, Marco

Louis

you may send me a copy of the article via LinkedIn

A method for Innovation is an interesting challenge. However, I understand the theme of Innovation and Creativity as related to humanities and social sciences - in the field of business and companies. Thus not envision the possibility of a model that can be generic to many types of businesses that theme. Instead, the Study Case, as in traditional business, seems to me the main source to provide insights to concrete situations.

Marie,

Ventures should be treated like scientific experiments, which involve identifying gaps in knowledge, developing a hypothesis, designing a test, conducting the experiment, and evaluating the results. If the hypothesis is supported, further research along the same lines can be undertaken with greater confidence. If it is not, the scientist will reflect on the possible reasons and then either stop or redesign the experiment. Even a hypothesis that is not borne out can be valuable, because it offers new insights. Budget approval processes that require proponents of a new business idea to commit to a return on investment (or net present value) goal inhibit managers from approaching ventures in this fashion. Everyone is forced to focus on success or failure in achieving a specific business outcome rather than on insights arising from the hypothesis that led to the venture. It makes much more sense to focus on the option value of a venture—the value of the opportunities it may open up, not all of which are known at the outset.”

My early work had some focus on managing innovation (see my resume at:

http://www.innovation.cc/editorial-board.htm

As an approach, I would suggest that you start by developing a clear, measurable definition of entrepreneurship.

Hi Marie,

One of my past studies focused on how to encourage innovation through collaboration among organizations. See the following article.

Rampersad, G., Quester, P., & Troshani, I. (2010). Managing innovation networks: Exploratory evidence from ICT, biotechnology and nanotechnology networks. Industrial Marketing Management, 39(5), 793-805.

http://www.sciencedirect.com/science/article/pii/S0019850109001278

More recently, I have been investigating how to foster innovation and entrepreneurship in university settings – both innovation skills in students and also building innovative universities.

See the following articles:

Rampersad, G., & Patel, F. (2014). Creativity as a desirable graduate attribute: Implications for curriculum design and employability.

http://www.apjce.org/files/APJCE_15_1_1_11.pdf

Rampersad, G. C. (2015). Developing university-business cooperation through work-integrated learning. International Journal of Technology Management, 68(3-4), 203-227.

http://www.inderscienceonline.com/doi/abs/10.1504/IJTM.2015.069664

Rampersad, G. C. (2015). Building University Innovation Ecosystems: The Role of Work Integrated Learning as a Core Element in the University-Industry Nexus. Journal of Research in Business, Economics and Management, 4(1), 231-240.

http://scitecresearch.com/journals/index.php/jrbem/article/viewFile/323/244

Rampersad, G. C. (2015). Managing Innovation Clusters: A Network Approach. Journal of Management and Strategy, 6(3), p9.

http://www.sciedupress.com/journal/index.php/jms/article/viewFile/7638/4537

The articles are all open access so you should be able to access them. Hope they help.

Best wishes,

Giselle