Innovation:

The term innovation derives from the Latin innovatio, the noun of action from innovare. The word first came into modern use in 1540 and stems from the Latin innovatus, pp. of innovare "to renew or change," from in- "into" + novus "new". Although the term is broadly used, innovation generally refers to the creation or improvement of products, technologies, or ideas. Innovation is distinguished from renovation in that innovation generally signifies a substantial change or difference versus more incremental changes. 


Innovation is an important topic in the study of economics, business, entrepreneurship, design, technology, sociology, and engineering. Colloquially, the word "innovation" is often synonymous with the output of the process. However, economists tend to focus on the process itself, from the origination of an idea to its transformation into something useful, to its implementation; and on the system within which the process of innovation unfolds. Since innovation is also considered a major driver of the economy, especially when it leads to new product categories or increasing productivity, the factors that lead to innovation are also considered to be critical to policy makers. In particular, followers of innovation economics stress using public policy to spur innovation and growth.

In the organizational context, innovation may be linked to positive changes in efficiency, productivity, quality, competitive partitioning, market share, etc. can all be affected positively by innovative forces. All organizations can innovate, including for example hospitals, universities, and local governments. Some will flourish under its influence. Other will die.

So as innovation typically changes value, innovation may also have a negative or destructive effect as new developments clear away or change old organizational forms and practices. Organizations that do not compensate effectively for innovative forces (mainly from outside) may be destroyed by those that do. Hence managing an organization typically involves risk. A key challenge in management is maintaining a balance between the current processes and business model.

Innovation has been studied in a variety of contexts, including in relation to technology, commerce, social systems, economic development, and policy construction. There are, therefore, naturally a wide range of approaches to conceptualizing innovation in the scholarly literature.