Innovation

“One need not be convinced of the importance of innovation in the face of grueling competition and fast-changing markets. Instead, one must ask about how to innovate.” This is what the editors of the Harvard Business Review wrote to introduce a reprint of Peter F. Drucker’s article “The Discipline of Innovation” (Drucker, 1998). 

However, it is wise to question why innovation is needed before exploring how it is done. Innovation is essential for organizations to adapt and thrive in rapidly changing environments; remain competitive; achieve longevity by continuously introducing new products, services, and processes; respond to unpredictable competitive landscapes; and create and sometimes destroy value because of its competitive nature (Kahn, 2018; Adomako & Nguyen, 2022; Schiuma & Santarsiero, 2023; Granstrand & Holgersson, 2020). 

Innovation is a company’s response to unpredictable and rapidly changing competitive landscapes in a critical effort to remain relevant or become relevant, even at the expense of competitors. Innovation refers to the implementation of a novel idea, approach, apparatus, or material. 

Innovation spans a continuum, not a dichotomous one, but a range from minor incremental adjustments to significant radical transformations. This continuum includes various outcomes such as products, processes, marketing, business models, supply chains, and organizational innovations. Innovation is a process and outcome, with an emphasis on how it is structured to attain the intended results. Additionally, it encompasses a mentality that encourages organizations and individuals to take risks, collaborate across disciplines, and embrace diverse perspectives, thereby fostering a culture in which innovation can flourish (Kahn, 2018). 

Over the past 250 years, waves of innovation have reshaped society and the economy. These waves, lasting 40 to 70 years each, have led to major societal shifts by fundamentally changing the value-creating logic of the economy, causing "creative destruction" where old companies and infrastructure are overthrown by new innovations. The first wave brought mechanization, transforming the economy from agrarian to industrial with machines such as spinning jennies and steam engines. The second wave introduced steel, steam, and railways, enabling rapid transportation and changing trade and cities. The third wave saw the rise of the industry, with innovations, such as assembly lines, revolutionizing production and transportation. The fourth wave brought electronics, television, and aviation, spawning new industries and changing politics. The fifth wave, the digital and Internet waves, has persisted until today. Since 2015, a new wave of ‘green’ innovation has emerged, focusing on radical resource productivity and renewable energy to drive a transition to a more sustainable future (MIT Press Reader, 2021). 

The former managing director of the MIT Entrepreneurship Center, Kenneth Morse, advocated for a purely commercial definition of innovation: “innovation is invention plus commercialization” (Entrepreneurship & Startups, 2014). Currently, MIT has an equally condensed yet broader definition of innovation: “the process of taking ideas from inception to impact,” whereby impact can be environmental, social, cultural, and not solely the financial profits (Murray & Budden, 2021) and total market dominance that Morse aspired. MIT’s current version, which acknowledges the sixth innovation wave, resonates with the definition of Sustainable Innovation. 

Innovation & Sustainability

Sustainable Innovation involves the creation of novel products, processes, services, and technologies that benefit institutions and human beings, while preserving natural resources and regenerative capabilities. Additionally, it encompasses advancements that not only yield enhanced economic performance but also contribute to improved environmental and social performance, both in the immediate and extended run, and are capable of producing favorable social and environmental consequences (Cillo et al., 2019). 

Sustainable Innovation (SI) emphasizes positive effects on sustainable entrepreneurship but may overlook unintended impacts, unlike Responsible Innovation (RI), which considers avoiding harm and doing good through sustainable development. RI involves codes of conduct; risk management frameworks; and anticipatory, inclusive, reflexive, and responsive dimensions. While Sustainable Innovation may lack explicit ethical considerations, Responsible Innovation ensures that ethical considerations are considered when managing user adoption and market appeal. Businesses may, by embracing Sustainability-Oriented Innovation (SOI), enhance the success and societal acceptability of their innovations by ensuring that they are cognizant of these distinctions, enabling them to match their innovation endeavors with sustainability objectives, societal benefits, and ethical standards (Long & Blok, 2023). 

The unique characteristics of Sustainability-Oriented Innovation distinguish it from other processes. SOI requires a forward-thinking approach, broad analysis, and consideration of environmental, social, and economic factors. This innovation approach prioritizes comprehensive and multidimensional sustainability goals; therefore, a systemic and societal perspective is required to account for them. Sustainable innovation emphasizes environmental and resource sustainability, whereas Responsible Innovation includes both ethical and social factors. SOI integrates these dimensions to address sustainability's complexity, which requires systemic thinking and a longterm perspective (Wilkerson & Trellevik, 2021). 

Sustainability-oriented innovation (SOI) refers to the creation of novel products, processes, and organizational frameworks designed with sustainability in mind from the beginning, with an emphasis on financial, social, and environmental factors. Addressing the carbon footprint, pollution, and lifecycle of materials are all components of this comprehensive approach, which also incorporates demand, partnerships, and strategy. To achieve SOI, actions and their effects must be thoroughly evaluated across multiple sectors, including the economy, society, and the environment. This entails acknowledging the interconnectedness and interrelation that exist across spatial and temporal scales as well as the implications for future generations. The objective is to find solutions that surpass small-scale modifications in products or technologies, thus necessitating a comprehensive view of systems and society that considers multifaceted goals (Baxter & Chipulu, 2018; Wilkerson & Trellevik, 2021; Cholez et al., 2023). 

Sustainable innovation focuses on developing products or processes that are environmentally friendly, whereas responsible innovation prioritizes ethical, social, and environmental considerations in the innovation process. Sustainability-oriented innovation (SOI) integrates sustainability into the core of an innovation strategy, aiming for a balanced approach to economic, environmental, and social challenges. SOI offers a comprehensive framework that encapsulates the principles of both sustainable and responsible innovation, underscoring the importance of a holistic strategy in addressing today's multifaceted challenges.

Recognizing the nuances between these concepts is crucial for businesses aiming to contribute positively to sustainable development, which requires a strategic alignment of innovation practices with broader sustainability goals. 

illuminem Voices is a democratic space presenting the thoughts and opinions of leading Sustainability & Energy writers, their opinions do not necessarily represent those of illuminem.

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