Innovation is one key factor for successful entrepreneurship. Every successful entrepreneur who stands the test of time must have used the weapon of innovation. The meaning and definition of innovation could be viewed in different angles.
In organizations, according to Luecke and Katz (2003), "Innovation is generally understood as the successful introduction of a new thing or method. It is the embodiment, combination, or synthesis of knowledge in original, relevant, valued new products, processes, or services.
According to Baregheh et al. (2009):
"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.
Innovation typically involves creativity, but is not identical to it. Innovation involves acting on the creative ideas to make some specific and tangible difference in the domain in which the innovation occurs. For example,
Amabile et al. (1996) propose:
"All innovation begins with creative ideas. We define innovation as the successful implementation of creative ideas within an organization. In this view, creativity by individuals and teams is a starting point for innovation; the first is necessary but not sufficient condition for the second".
For innovation to occur, something more than the generation of a creative idea or insight is required: the insight must be put into action to make a genuine difference, resulting for example in new or altered business processes within the organization, or changes in the products and services provided.
"Innovation, like many business functions, is a management process that requires specific tools, rules and discipline."
From this point of view emphasis is moved from the introduction of specific novel and useful ideas to the general organizational processes and procedures for generating, considering and acting on such insights leading to significant organizational improvements in terms of improved or new business products, services, or internal processes.
As an economic conception, Schumpeter (1934), defined economic innovation as:
Amabile, T. M., Conti, R., Coon, H., Lazenby, J., & Herron, M. (1996). Assessing the work environment for creativity. Academy of Management Journal, 39(5), 1154-1185.
Amabile, Teresa M (1998): How to Kill Creativity. Harvard Business review, pp 77-87, 1998
Baregheh et al. (2009): Towards a multidisciplinary definition of innovation. Management Decision 47(8): 1323–1339
Luecke and Katz (2003): Managing creativity and innovation. Boston, MA: Harvard Business School Press
Schumpeter, Joseph A. (1934): The Theory of Economic Development. Cambride: Harvard University Press. (New York: Oxford University Press, 1961.) First published in German, 1912.