How Would You Define Innovation?

by Dan Robles on 12/07/2008

Today, innovation is repeatedly cited as the only thing that can get us out of the financial/environmental/sustainability conditions that find our ourselves in, yet the most common definitions for this term are deeply and tragically flawed.

Like the 1500’s A.D. definition of the Sun revolving around the Earth, an unusable definition can completely block our ability to see the truth about the phenomena that surrounds us. Let me explain:

Most definitions for innovation boil down to: “a new idea introduced that has an economic outcome” or “something new that is useful”. While these definitions match some observations, they are reflective; “You know it when you see it”. As such, there is no way to define innovation before it happens or to make more of it from the definition. It is like defining “Art” as the thing that people stare at. Unfortunately, this is just the beginning of our troubles.

“Innovation is a new idea introduced that has an economic outcome”

This definition defines one unknown quantity (innovation) with four other unknown quantities: what is new; what is an idea; what constitutes “introduced”; and what is an economic outcome? From High School Algebra we know that you cannot solve one equation with two unknowns – let alone four. There is little that you, I or anyone else can do to satisfy this definition.

Granted, this definition sells plenty of ad copy as the guru of the week waxes poetic over those four pesky unknown thingies.

What is the truth about the phenomenon of Innovation?

A useful definition must identify the subject truthfully in a manner that is repeatable and measurable.

If we look at history we know that economic growth and innovation are mutually dependent – you can’t have one without the other. Wealth is created by increasing human productivity through innovation in agriculture, manufacturing, computers, etc.

Next, we observe that information, knowledge and innovation are also mutually dependent – you cannot have one without the other two. Wealth is created by integrating information, knowledge and innovation.

Next; look at our society; everywhere we turn, people are collecting information from each other, building their knowledge, and innovating together, i.e., coming up with better ways to do things. All of these little exchanges obviously add up to something because things like IPods and Airplanes get built and lots of stuff rolls off assembly lines.

Our definition for innovation must reflect social and financial reality.

We can start by saying that Innovation increases human productivity. Next we can say that information, knowledge and innovation can be related as follows:

  • Information is defined as facts and data

This should not surprise anyone.

  • Knowledge is related to the rate at which information (facts and data) changes over time.

This is a little trickier to grasp. But any good teacher knows that information must be introduced in a certain order and at a certain speed before the information can become knowledge – this is called learning. Learning is a mental process for turning information from a book, a lecture, or personal experience into knowledge that can be used later. Therefore, knowledge is proportional to the rate of change of information and can only exist inside a person’s head.

  • Innovation is related to the rate at which knowledge changes over time

trickier still, but for example; everyone has had an ‘Ah-Ha!’ moment during a brainstorming session, some incredible event that we witness, or even after some real bad mistake that we made. The AH-HA moment is a spike in our knowledge that happens in a very short period of time. Innovation is related to this high rate of change of knowledge. Then we blurt it out, or write it down, or make a sketch, give a lecture, in the form of information, etc.

Definition of Innovation:

a. Innovation is anything that increasing human productivity.
b. Innovation is anything that increases knowledge and improves information.

This definition included all conversations, sketches, dreams, and ideas of all people on Earth that combine with the sketches, dreams, ideas, of all people on Earth to become designs, methods, and processes which further combine to become products, systems, and institutions, etc.

Now we can worry about whether is has an economic outcome or not. Since innovation can be difficult to observe directly. Our new definition allows us to use a proxy that is easier to see. For example; if you want to identify innovation as it is happening, simply look for high rates of change of knowledge in a community. If you want to create innovation, do things that create high rates of change of knowledge. Likewise, if you want to identify knowledge, look for high rates of change of information. If you want to create knowledge, do things that create high rates of change of information.

We need to give the entrepreneur a game they can win. This is a definition that can be used by anyone and everyone.


[Anyone familiar with differential Calculus can see an equation forming where Innovation is the derivative of knowledge and knowledge is the derivative of information. Calculus is the study of change like geometry is the study of space. Since the mathematics is beyond the scope of this article, I’ll finish with the following analogy for defining information, knowledge, and innovation more intuitively: “Information is to knowledge is to innovation what distance is to velocity is to acceleration”]

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