Growth & Innovation

Invention vs Innovation: A Crucial Distinction for Business Success

Welcome to the first article in my series on Growth & Innovation. Many of you may have heard the saying, “Innovation is the lifeblood of business.” But what exactly is innovation, and how does it differ from invention? Should your organization focus on invention or innovation? Is there a systematic way to think about innovation that will help your team and business focus its efforts?

With over two decades of experience in the chemical industry, split between R&D and Marketing, I have worked with numerous businesses to help them understand and implement innovation. These experiences have shaped my perspective on innovation, and I’m excited to share my insights. My hope is that organizations, both large and small, can benefit from these learnings and deliver innovative products and services to their customers.

In this series, I will outline the difference between invention and innovation, highlight why innovation is crucial for business success, discuss the current state of innovation, and present a systematic approach to fostering innovation within your organization.

Invention vs. Innovation: Understanding the Difference

Over my career, I’ve noticed that people often conflate the terms invention and innovation. This confusion sometimes leads organizations to question the value of R&D and Marketing, as their contributions to ROI, revenues, and profits are not as direct as those of Sales. Even when new products are launched or pricing is adjusted based on value, the roles of R&D and Marketing aren’t always clear-cut.

Consider the following: Was Thomas Edison an inventor or an innovator? How about Henry Ford? Were products like the iPhone an invention or an innovation? What about Teflon? or the non-stick pan coated with it? How about electric vehicles (EVs), the lithium-ion batteries that power them, and the electrolytes within those batteries?

According to Webster’s dictionary, to invent is to “produce something for the first time through the use of imagination or ingenious thinking and experiment.” To innovate is to “do something in a new way.” I would go further and define innovation, for our purposes, as doing something in a new way to make customers’ lives easier. Innovations are built on inventions, some products require just one or two inventions tweaked to fit the customer need will the more complex innovations require tens or hundreds of inventions to create a break through.

For example, the transistor was invented in 1947, earning Bardeen, Brattain, and Shockley the Nobel Prize. A single was about the size of a typical medicinal capsule. Today, Nvidia’s Blackwell B200 GPU contains 208 billion transistors, all fitting into the palm of your hand. The invention of the transistor led to countless innovations in electronics, demonstrating how invention lays the groundwork for innovation. At its core, innovation is about addressing customer needs.

Innovation Engine: The Role of R&D and Marketing

R&D and Marketing are the engines of innovation and are inseparable in their contribution to a business’s mission to serve customers profitably. Many times, new product development starts with the R&D team identifying a product with exciting properties and working on a project to develop it into a marketable product. Often, this happens without input from customers or the market. This type of product, looking for an application, is no different from a solution looking for a problem—or more bluntly, a hammer looking for a nail.

This approach not only consumes significant R&D resources but also requires additional effort from the commercial team to find a market and customers to sample and eventually sell these products. Such efforts can lead to significant sales, but the resources consumed are often disproportionately higher than the revenues and profits generated.

In contrast, market or customer-driven innovation aims to solve specific problems to improve customers' lives. Here, the marketing team dives deep into understanding the challenges faced by the market or customer and works closely with the R&D team to solve the problem. Since the marketing team has taken the effort to understand what the final product should deliver, the R&D team can significantly narrow the search space and bring a product to fruition much faster. This approach of identifying the problem first and solving it has a higher probability of success.

Over the next several posts, I will outline my views on what it takes to innovate.

To summarize, invention is the creation of something new, such as a transistor or polymer (like Teflon?). Innovation is the process of using that invention to make life easier for people. Innovation often relies on multiple inventions to bring a new product or service to market.

In the next article, we will explore why innovation is vital for businesses to thrive and succeed in today’s competitive landscape.

Stay tuned, and thank you for joining me on this journey through Growth & Innovation.