Invention and Innovation
Invention is the creation of a new device or process. Examples include computers, software products, chemical processes, junk foods, and kitchen gadgets. Innovation is the introduction of change via something new. Cable television and video rental stores were innovations, as were overnight mail and communication via fax and the Internet. Each of these innovations took advantage of one ore more inventions. However, these inventions were not the innovations.
The vast majority of inventions do not result in change. Recently, I saw evidence of this conclusion from two sources. The first was William Rosen’s book The Most Powerful Idea in the World: A Story of Steam, Industry, and Invention, (Random House, 2010). Rosen chronicles the many inventions emerging during the Industrial Revolution in the 1700s and 1800s, primarily in England but also the United States. A large number of highly motivated artisans created a wealth of inventions, a few of which converged in steam engines that led to business innovations in manufacturing and enormous economic growth.
The other source was an opportunity to speak to the Inventors Association of Georgia. I talked for an hour to roughly one hundred inventors on “How to Get Your Ideas Supported.” Prior to and following my talk, I enjoyed talking to many of these people about their ideas. Just before I spoke, the host, Dave Savage, asked people about the status of their ideas – was development done, had they secured a patent, and was their revenue thus far sufficient to recoup their development costs. Many people had patents. Quite a few were done with development. One person had recouped his development costs.
In his review of the inventors of the Industrial Revolution, Rosen commented that hundreds of artisans thought they could become rich and famous; a few did. This has not changed. The hundred inventors I talked with recently seemed to me to be convinced that great success was just around the corner, yet only one had managed to achieve break even. The odds of creating a true innovation, not just an invention, were pretty low during the Industrial Revolution and are pretty low now.
I find it interesting that so many people are willing to invest great energy and scarce resources when the chances of success are so low. Of course, they do not seem to think that their chances are low at all – the statistics only apply to everyone else. It strikes me that we are very fortunate that many people will take such chances. The vast majority will fail, but the economy will inevitably prosper, especially if we continue to applaud those who invent and do their best to innovate.