Innovating for success in business education

Business Impact: Innovating for success in business education

Innovating for success in business education

Business Impact: Innovating for success in business education
How should Business Schools harness learnings from the Covid-19 pandemic and position themselves in a digital landscape?

The world of business education looks very different to the way it looked at the beginning of the pandemic, with remote learning becoming a new normal.

Just like businesses, educational institutions have had to adapt in order to comply with lockdown restrictions, while maintaining a quality service. Although this has been challenging, Covid-19 has created opportunities for digital innovations within Business Schools and wider education.

Digital technology has played a vital role for faculty and students alike. Platforms such as Zoom and Teams have replaced the traditional classroom, and the tech industry has been quick to come up with solutions. From startups to multinationals, these companies are working to improve the world of online learning, developing education technology at a rapid pace. 

This gives Business Schools an opportunity to reflect on how innovations will affect the day-to-day delivery of teaching going into the future. It falls on Schools to continue to be flexible and to adapt to the post-Covid-19 world, taking the valuable skills and lessons learned and developing them further.

Adapting to the digital landscape

In a session at the AMBA & BGA Business School Summit 2022, a panel of experts pondered the future of Business Schools in the digital landscape, and discussed how leading Schools should position themselves in a changing environment.

Kicking off the conversation, Simone Hammer, Head of Marketing for Learning Experiences at Barco, commented that although ‘lots of organisations tried to “run faster” during the pandemic’ others took the opportunity ‘to step back and analyse, without getting exhausted. In saying that, innovation and creativity come out of urgency’, she pointed out.

Tiffany Monaco, Global Business Development and Innovation Leader at IKEA Retail (Ingka Group) highlighted the move to partnership working. ‘The world changed very quickly last year, but if we want to change the way we work by 2030, we need to take action now,’ she said. ‘This pandemic has also sparked a lot of collaboration. Boredom demands creativity, so in the past two years, I’ve had more collaboration and more creativity with my colleagues.’

Meanwhile, Miika Makitalo CEO of HappyOrNot, explained that, in his opinion, the pandemic has revolutionised the behaviours of consumers. ‘The pandemic gave us the opportunity to stop asking “what is the winning strategy?” We’ve been building a clear focus on what we’ve been doing and asking how we can add more value,’ Makitalo added.

‘By combining data and partnering with other organisations, we’ve explored things we’ve never experienced before. We had more time to think, more time to focus and more time to collaborate. In the marketplace, the ones that are innovating are winning.’

But Makitalo stressed that ‘there is great value in failure. Success is a terrible teacher. We have always had an upward trajectory of profit, which started to plateau, so we began to shift our way of thinking and boost innovation. I would say there’s always room for improvement in terms of how organisations approach failure, but having psychological safety and empowering people to be humble is really key. That mitigates risk. 

‘If you’re afraid to embrace your failure, you’re more inclined to hide it and this leads to a snowball effect. Instead leaders can create a culture of accountability; embracing failure; and moving on.’

Hammer advocates asking for help and nurturing a culture of trust. ‘Looking out for collaboration – next to failure – is really important’, she said. 

Maria Luciana Axente, Responsible AI & AI for Good Lead at PwC, concluded: ‘Finally something has happened that we’ve been predicting for a long time. For years, we’ve been preaching to our clients that they will have to digitise. Before the pandemic organisations could cover their lack of digitisation with people skills, but now there is a huge opportunity to develop digital infrastructure. 

‘In the uncertainty that will follow the pandemic we have an opportunity to optimise our processes. Digitisation can replace repetition and empower innovation. No innovation can be realised without infrastructure, and this allows us to make a sustained and profound impact.’ 

Simone Hammer, Head of Marketing, Learning Experiences, Barco

Maria Luciana Axente, Responsible AI & AI for Good Lead, PwC
Tiffany Monaco, Global Business Development and Innovation Leader, IKEA Retail (Ingka Group)
Miika Makitalo CEO, HappyOrNot

This article is adapted from one which originally appeared in Ambition – the magazine of the Association of MBAs.

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Transforming in turbulence

Business Impact: Transforming in turbulence

As Covid-19 continues to cause disruption, Frankfurt School of Finance and Management is preserving its innovative edge and adapting to emerging trends. David Woods-Hale speaks to its President, Nils Stieglitz

In 2022, it will have been 10 years since you joined Frankfurt School of Finance and Management. What have been the biggest changes in business strategy? 

There have been two major developments. First, across industries, there has been an increasing need to understand and respond to the changing role of technology and business disruption. Changes in the business landscape force companies to become more adaptive internally as we have within the wider ecosystem. Second, the topic of sustainability has moved from being a ‘nice to have’ to a ‘must have.’ Nowadays, business strategies must address how a company makes a positive contribution above and beyond financial returns to owners and shareholders.

What are the most pressing challenges facing international Business Schools? 

With the Covid-19 pandemic on top of a global climate crisis, every aspect of a Business School can be considered VUCA (volatile, uncertain, complex, and ambiguous). We have seen disruptive technologies enabled by the pandemic changing the demographics of our knowledge economy on a global scale. The most pressing challenge has been to adapt to this in time. Speed is of the essence. 

Is the business education sector responding quickly enough to this ongoing disruption and what advice would you offer to other deans?

I would say that Business Schools are doing a good job at adapting to the new reality. We have seen a lot of innovation and experimentation, especially during the past two years. Many Business School leaders have quickly transformed how they teach, interact, and do research. However, the challenge will be to preserve this innovative edge once the immediate pressures created by the pandemic subside. 

We have learned so much from how we had to pivot to remote learning so suddenly, and using the necessary software and technologies to do this effectively. Business Schools will only continue to stay relevant if they explore new opportunities and continue to be ready to change – sometimes quite drastically. Intel’s Andy Grove once argued that only the paranoid will survive disruption – and there’s a lot of wisdom in that claim. 

Your research interests focus on strategic decision-making and organisational adaptation. These topics have, arguably, never been more important than during the Covid-19 pandemic. Can you share some insight into how your School managed through the pandemic? 

Early in the pandemic, I gave a talk to our alumni about managing in a crisis. I made three key points:

1*. ‘Prepare for the worst and hope for the best’ (which is a saying attributed to former UK Prime Minister Benjamin Disraeli). On the one hand, it was important to think in terms of scenarios and to develop options (especially around trimming costs and scaling back investment) that we were ready to act on. That gave us a lot of flexibility as the pandemic unfolded. On the other hand, it was crucial to identify and focus on the opportunities created by the pandemic. 

2*. A crisis provides a good opportunity for innovation. For example, according to some research, the Great Depression was the most innovative decade of the 20th century. That coloured my own thinking about how to handle the crisis. For example, we suddenly – more or less overnight – had new digital formats that could reach students and alumni all over the world. 

3*. A crisis reasserts the value of strategy. Strategy is very much about deciding what not to do – and a crisis forces you to have clarity about your key priorities. 

How did the pandemic change your School for the long term? And what have been your most important learnings during lockdown? 

As was the case for organisations in many other sectors, Business Schools had to engage technological and digital processes and equipment at a level that many Schools may not have experienced or attempted to deliver before. Schools and campuses being forced to close so suddenly meant that teachers would have to deliver lectures and education to students online for an undisclosed period of time, with many potentially never having experienced this before. 

Over the years, digitalisation and technological advances have been increasing within Schools, but the pandemic has really forced us to push all aspects of digitalisation from theory into practice. We can now effectively and successfully offer hybrid learning – combining both online and offline learning – for students that require or desire that flexibility. 

Within Frankfurt School, the pandemic also forced us to accelerate existing processes of change drastically.

How do you believe technology will continue to impact and disrupt the Business School environment as a whole?

The future of our sector is hybrid. We have learned over the past two years how vital the campus environment is to students. Therefore, we might see more and more shifts towards augmented and virtual reality at home. Institutions such as ours will have to find a way into our students’ environments through more than just Zoom lectures.

Business Schools might also want to invest in augmented reality tools to add value to their physical campus by bringing the outside world in for the students to experience it. Schools should invest in capacities that students could not afford or have on their own. Lecturers will have to learn to use tools and devices meant for enhancing education in this way and become mediators between students and the campus.

Can you give some examples of innovation that the Frankfurt School of Finance and Management is developing to future-proof its postgraduate business programmes moving forward? 

Frankfurt School actively lives by the principle of continuous learning. We encourage personal and professional development at all career levels – nationally and internationally. Nowadays, employees and business leaders face an increasing necessity to reskill and to develop continuously. 

To further our students’ development, we offer a variety of executive education programmes, ranging from seminars and certificates to Executive Master and MBA programmes. All of our formats are grounded in research and all offer practical elements. 

Traditional classroom teaching no longer suffices, so we offer hybrid and online courses, as well as various on-campus and virtual experiences. As we see an increasing need for virtual teaching, we design our online courses in a clearer, shorter, and more engaging way. 

For example, our online courses carry elements of gamification, artificial intelligence (AI)-based research, and are often personalised to each participant’s individual and unique needs. Students can study in bite-size modules, in their own time, and they can do this anywhere they want. 

How important is it that Business Schools are ahead of the curve in terms of lifelong learning and alumni relations, in light of emerging trends such as stackable courses and digital credentialing? What more could and should they be doing?

I consider it very important! When it comes to what Business Schools should be doing to stay ahead of the curve, I believe a mandatory semester abroad should be incorporated into BSc programmes. The world is becoming increasingly connected – even more so since the increased use of online working and learning due to the pandemic.

Individuals from multiple countries can easily be in the same lecture or work meeting without actually being in the same room. Affording Business School students semesters abroad gives them some experience of different cultures, education, and people from the very beginning of their higher education journey.

Future-focused topics should also be introduced into Business Schools, including areas of AI, blockchain, and sustainability. 

Disruption is changing the workplace as much as the business education space. How are you ensuring that your graduates have the mindsets needed to be agile-yet-decisive as they lead the businesses of today and tomorrow? 

We do this directly and indirectly through the content and structure of our programmes. The content is shaping the mindset of our participants. We cover the theories that are essential to leadership. The structure of our programmes is also intentional. We have built in ‘surprise’ elements where students are required to pivot, think on their feet, make quick decisions and then carry them out sustainably. 

Business leaders can usually predict pretty well what tomorrow is going to look like, but there are things we cannot predict. Covid-19 is an example of this. But there was always a theoretical possibility of a global pandemic, just as there is a theoretical possibility of a nuclear war, or alien invasion – all things that are very difficult to plan for. I think our future business leaders of tomorrow need confidence in their ability to predict what’s going to happen under normal consequences.

Sustainability and climate change are huge influencers on how we will live and work. What does sustainability mean to you as a Business School leader? 

The original intent of Business Schools, as stated by the Ford and Carnegie Foundation Studies of 1959, was to ‘professionalise management’ – meaning ‘to create responsible professionals’. In 2021, responsible has a new meaning. This meaning is derived from the UN’s 17 Sustainable Development Goals, but we have adapted it to our institutional vision. In line with our commitment to the highest scientific and academic standards, the approach to sustainability at Frankfurt School is led by hard science which is skills-based, interdisciplinary, integrative and authentic.

Students care very much about the climate agenda. Do you think this will have as much of an impact on student recruitment, physical environments and student exchange and study tours, as as it will on course components and pedagogy? 

Now more than ever, rankings continue to be a primary source of Business School legitimacy, which prospective students consider when choosing programmes and Schools. The weight of various sustainability categories increases each year, and individual Schools win or lose as a result. This, in turn, has an impact on which School a student chooses to study at.

‘Green topics’ such as sustainability and green finance are growing in demand. These subjects used to be integrated into traditional core courses, but now we are developing entire programmes around them. We have seen this trend in Executive Education specifically, and have reacted very quickly by offering courses such as Financing Renewable Energy, Certified Expert in Sustainable Finance, and Certified Expert in Climate & Renewable Finance. 

The Erasmus+ Programme is also encouraging students to find a ‘green’ approach to their exchanges. One of the ways is to choose greener accommodation options. At Frankfurt School, we are committed to providing those options, and are working closely with our partners in the building of our new student accommodations to ensure they are up to the latest standards in sustainable living. 

Your School’s strategy will create revenue streams for green investment in emerging markets. Can you explain a bit more about this innovative crowdfunding initiative? 

Our new crowd investing platform,, offers retail investors the opportunity to finance green projects and SMEs in Africa and Latin America. We bring together companies that want to go green with investors who put an emphasis on financial return and environmental protection. Crowd investing is a relatively new form of finance that allows private investors to directly finance projects, and companies that meet their personal preferences. With individual investments starting from as little as €100 EUR, allows everyone to participate and diversify their portfolio. 

All information is provided to potential investors so that they can make an individual, informed investment decision. We define green investments in terms of sustainability and environmental protection. A green investment must – directly or indirectly – have a sustainable positive impact. 

The platform is managed jointly by the Frankfurt School-UNEP Collaborating Centre for Climate and Sustainable Energy Finance and FS Impact Finance, and co-operates with GLS Bank. 

It is part of the International Climate Initiative and supported by the Federal Ministry for the Environment, Nature Conservation and Nuclear Safety.

What are the next steps for you as a leader and for Frankfurt School of Finance and Management? 

I hope that Frankfurt School of Finance and Management will continue to grow, but also that we keep our edge – that we remain as vibrant and as innovative as we currently are. I think it’s vital that we preserve this.

Do you feel optimistic about the future of business, Business Schools, and the economy?

I am hopeful about the world. It might seem like a very dangerous place to be right now, but if you look at the broader picture, things have improved over recent decades and centuries. We live longer, we are generally more affluent – not just in Europe, but also in Asia and increasingly in Africa, and we suffer fewer deaths from wars. Climate change is a huge challenge, but one I am confident we can tackle. Our right to liberty, freedom and free enterprise has also come under a lot of pressure in recent years, and not just because of Covid-19. However, I am hopeful that in the future we come back to this trajectory.

Nils Stieglitz has been President and Managing Director of Frankfurt School of Finance and Management since April 2018. His primary research interests are strategic decision-making and organisational adaptation.

This article is adapted from one which originally appeared in Ambition – the magazine of the Association of MBAs.

The entrepreneurial future of the workplace

Business Impact: The entrepreneurial future of the workplace

What is the future of the physical and virtual workplace? Birmingham Business School’s Endrit Kromidha and Matthew Thomas consider the rise of entrepreneurial work and the dangers of losing unplanned and in-person exchanges of ideas

A shortage of containers for international shipping, missing products from supermarket shelves and an absence of workers to fill cars with fuel in petrol stations can, in great part, be attributed to a global mobility crisis due to the pandemic.

Excluding the violence, similar situations have been faced only in times of war. As expected, the response from business has been to innovate and adapt in order to survive and potentially gain a competitive advantage for the long run.

In times of crisis and when the future is unknown, it becomes necessary and therefore easier for everyone to dare more. This article reflects on the rise of entrepreneurial work, digital platforms for doing more remotely, and the hybrid future of the office, drawing implications for business graduates and managers.

Entrepreneurial work

Proactiveness has been shown to be a key characteristic of entrepreneurial orientation, related to actively seeking, creating and exploiting business opportunities. The current pandemic has been very challenging, but it has also created opportunities through systemic changes.

Many business leaders have, typically, pushed the pressure to be proactive down the hierarchical ranks of an organisation. In doing so, being proactive and adapting to changes have become expectations at any organisational level.

This leads to the second dimension of entrepreneurial orientation – innovativeness. This refers to developing new processes, products, resources, services, markets or organisations. Entering the unknown space of innovation requires taking risks, which is the third dimension of entrepreneurial orientation.

In this new environment, job redesign, job rotation, or other innovative ways of inducing change in the workplace, happen naturally. What’s required is an entrepreneurial mindset at every level of the organisation, together with a paradigm shift on the use of digital platforms and technologies for new ways of working.

Redefining digital work platforms

Digital platforms have long been used for a number of efficiency-related reasons in business, such as better communication, access to information and resources, easier exchanges of financial and other forms of capital, and transfers of knowledge through collaborative work for open innovation and co-creation across organisational and national borders.

Yet, until the start of the Covid-19 pandemic, digital platforms were considered in great part peripherical to the physical workspace and human interactions. Not anymore, the paradigm shift to online and remote as the new norm has already happened. Technologies like Zoom or Microsoft Teams are only the surface of what the future could bring with metaverse virtual reality solutions at work.

In the new digital workplace, meeting in person is considered a rather dangerous (for reasons of  health and wellbeing) alternative that needs to be used sparingly. Thanks to digital work platforms, the notion of the office has transcended organisational boundaries, often entering peoples’ homes, and now occupies their free time and weekends just as a business would do for a 24/7 entrepreneur – but this process is not without other challenges.

The post-pandemic office

The physical office must not be ignored. Early in the pandemic, when working from home was still a novelty, many enjoyed the newfound convenience of not needing to commute to and from work. In addition, there was a sense that efficiency had improved as well. Meetings became far more transactional, where agendas were prepared, people spoke one at a time, and they finished when the work was done.

As the pandemic wore on, we started to notice some aspects of work that were made more difficult by being remote from each other. Minor disagreements between colleagues could fester because there were no easily accessible social mechanisms to diffuse the situation. As a result, minor disagreements could become sources of conflict and sometimes hostility.

Perhaps even more seriously, we started to miss the unplanned conversations that occur just because we happen to be in the same physical vicinity as others. The conversations when walking with a colleague to a meeting, over a cup of coffee on a break, in the canteen at lunchtime or on the way to station when leaving work. On Zoom and Teams, these conversations hardly ever happen. But why is this so important? There is a lot of evidence that suggests that it is these unplanned encounters that fuel creativity and innovation. The best ideas come from encounters with people we did not know we needed. The danger therefore for organisations that abandon the office completely is that it may lead to an innovation deficit.

What can the business managers of the future learn from this?

Organisations have reacted to the newfound freedoms of remote working in very different ways. Some have abandoned the office entirely, opting for the convenience and cost benefits of working from home. Others have gone to the other extreme and insisted that all staff return to the office. Given the importance of chance encounter to innovation, it is no surprise that some of the tech giants are among those pursuing this policy.

Most organisations, however, have opted for some sort of hybrid model, allowing employees to blend working from home with working from the office. What business managers need to ensure is that these decisions are based on the needs of the business rather than the opportunistic saving of real estate costs or the evidence of short-run added efficiencies.

In this light, the role of the office may also change in the future. The main purpose of the office could shift from one that encourages productivity in the workplace to one that encourages unplanned social encounter. Already, some organisations are starting to reimagine their offices as social hubs that are there specifically to fuel innovation.

Endrit Kromidha (left) is an Associate Professor in Entrepreneurship and Innovation at Birmingham Business School, University of Birmingham, and Director of the Birmingham MBA in Singapore. He is also an entrepreneur with industry experience in banking and finance, and the Vice-President for Policy and Practice at the Institute for Small Business and Entrepreneurship.

Matthew Thomas (right) is an Assistant Professor of Strategy and International Business at Birmingham Business School, University of Birmingham, where he lectures in international strategy, innovation and strategic change. His background is as a practicing manager, most recently with Assa Abloy, a Swedish organisation ranked as one of the world’s 100 most innovative companies by Forbes.

Business Schools’ vital role in driving innovation

business impact world-map-chart-tech-cityscape-cropped.jpg

As products and business models become more complex, innovation requires specialised academic institutions, writes Arturo Bris, Director of the IMD World Competitiveness Centre

In the late 19th century, two French brothers – Auguste and Louis Lumière – invented the cinematograph. They are credited as the founders of modern cinema, and owned more than 170 patents in imagery development, and in other fields such as medicine. They are among the few French nationals to be honoured on Hollywood’s Walk of Fame.

In those days, most revolutionary innovations were coming from England or the US; for example, the steam engine or electricity. Why is it, then, that the Lumières – young men from Lyon, a mid-size city in France – gave the world such important technology? 

Auguste and Louis’ creativity was the result of their family – their non-conformist father was the owner of a photography business – and their personality traits (risk attitude, curiosity) also influenced their creativity. However, the main factor for the birth of cinema in Lyon is an educational institution – La Martinière – from which the brothers graduated as engineers. La Martinière could be described as the MIT of the day, with a curriculum that promoted technology, chemistry, industrial knowledge, and experimentation. As well as being the alma mater of some of Lyon’s prominent industrial and commercial leaders, it attracted students from all over the world who were interested in technology and innovation.

The ability to innovate

Very often, we attribute the innovation of specific people or countries to individual attitudes or national culture. When I ask members of IMD’s executive programme why they think that, in Europe, there are no digital platforms along the lines of Alphabet (in the US) or Alibaba (China), they either blame a risk-averse attitude among European entrepreneurs, the lack of a ‘failure culture’, or inadequate regulation. While countries such as Israel and Taiwan are innovative by nature, the same can be said of Jordan and Ukraine. So why do we rarely see see disruptive innovations coming from the latter two? 

My recent book, The Right Place: How National Competitiveness Makes or Breaks Companies, argues that, in determining corporate success, factors such as leadership and strategic choices, are marginal. From my research, and that of others, we can conclude that the impact of leadership teams on corporate performance is moderate at best; some CEOs increase value, but some destroy value. 

The factors determining corporate success are global and national. My work shows that 80% of a company’s stock return variability is explained by factors such as the business cycle, trade wars, geopolitical tensions, and regulation. The Covid-19 pandemic has taught us that the fate of organisations is often dictated by uncertainties that are not controlled by companies.

In that context, decisions at a country level, such as capital markets design, education policies, and fiscal rules for talent attraction, have a greater impact on innovation than the DNA of potential creators. Specifically, educational institutions play a vital role in shaping innovation. 

Stanford comes to mind as a global leader in the production of startups, with Alphabet being its most successful result. Facebook and Microsoft were born in Harvard dorm rooms, while, in total, Harvard is the alma mater of 1,310 entrepreneurs. Michael Dell was a student at the University of Texas when he founded his computer brand. Dropbox was born in MIT; WordPress at the University of Houston; Reddit at the University of Virginia and Fedex at Yale. Skype was developed by a graduate of Uppsala University (Sweden), and Logitech was founded by two colleague students at EPFL in Switzerland. 

Specialist institutions for innovation

As products and business models become more complex, innovation requires specialised academic institutions. That is why Business Schools have been the seed of many important innovations of the past decades. Desigual, one of the most international fashion retailers, was founded by an alumn from the IMD MBA programme. The founders of Zoom Technologies, Peloton, and Grubhub planted the seeds of their companies while attending classes at Stanford, Harvard, and Chicago Booth respectively. 

How can universities, and Business Schools in particular, be centres of excellence for innovation? First, let me point out that, for innovation ecosystems to succeed, they have to combine three key success factors. The first  is access to capital. The benefits of finance are important and have been documented by academics and international organisations. 

In 2000, Professor Jeffrey Wurgler (then at the Yale School of Management and currently at NYU), highlighted in a paper published in the Journal of Financial Economics that more financially developed countries allocate capital with greater efficiently across industries. Specifically, Wurgler found that ‘developed’ financial markets (measured by the size of the domestic stock and credit markets relative to GDP) such as the US and the UK, increase investment in growing industries and decrease it in their declining industries. 

Effective financial systems are both the consequence of and the reason for the competitiveness and innovativeness of countries. Over time, the interaction between Wall Street and Main Street – or between the financial system and the real economy –reinforce each other, and we observe the positive impact that a good financial system has on economic growth and quality of life. Conversely, countries that forget the financial sector struggle to develop a competitive economy, despite their innovation and talent.

The second important factor is regulation. To be innovative, firms need to have rules that protect intellectual property, bankruptcy laws that allow failure and recovery, and fiscal rules that facilitate foreign investment and talent attraction. Regulation removes uncertainty, and this explains why innovation is more difficult in Europe, where innovators need to comply with a myriad of regulatory regimes, compared with the US and China. 

The role of the education system

When good regulation is combined with access to capital, innovators emerge. This is where the third factor – the education system – plays a vital role. Business Schools are becoming important parts of a country’s innovation ecosystem. Entrepreneurs need to be more than creators, and need to learn how to monetise their ideas. The Lumière brothers never attended Business School. And this is probably the reason why their creation did not result in the movie industry being built around Lyon, but in Los Angeles. The Lumière brothers of the 21st century need business education, but such education must fulfill three requirements:

1. Business Schools need a good curriculum
To transform ideas into businesses, innovators need to know finance, marketing, and strategy. Design and technology skills are not enough. This also means that Business School curricula should emphasise management skills at the expense of experiential learning and leadership skills. Traditional Business School disciplines are important – especially for those who do not plan to work for a large organisation – because founders have to have a helicopter view of their companies, which requires a deep understanding of all dimensions of performance.

2. As technology will be the basis for many of the upcoming innovations, Schools need to embrace technology-related subjects
At IMD, we have reduced the importance of accounting in the MBA curriculum in favour of coding, a one-week innovation journey, and courses covering artificial intelligence, Blockchain, and Big Data analytics. We have also enlarged the finance and marketing courses.

3. For Schools to be part of the innovation ecosystem of their country, they must partner with the public and private sectors to create synergies
Governments need to realise that attraction of talent to Business Schools results in innovation, and therefore more jobs and prosperity. At the same time, Business Schools as academic institutions need to feed the country with research related to entrepreneurship, family business, and innovation. 

Business Schools must hear the demands of companies and adapt their programmes to the needs of the labour market. The benefit for Schools is that, as the reputation of their country increases, so does the ability of the School to attract better students.

Innovators are not born but made. Business Schools are part of a country’s innovation ecosystem and while technical universities (the La Martinières of our times) continue generating ideas, Business Schools transform these ideas in businesses, jobs,
and competitiveness. 

Arturo Bris is Professor of Finance at IMD and Director of the IMD World Competitiveness Centre. His new book, The Right Place: How National Competitiveness Makes or Breaks Companies is published by Routledge. 

This article originally appeared in Ambition – the magazine of the Association of MBAs.

Innovation for success in business education

Lightbulb glowing white with cartoon facial features and a metallic arm pointing upright; this is symbolic of innovation and ideas. Business Impact article from Leading change and inspiring lifelong learning.

Leaders from Rolls-Royce, PwC and the European Space Agency on how innovation will impact the business world, and what this means for business education. Highlights from a session at the AMBA & BGA Festival of Excellence

What challenges and opportunities await Business Schools in the ‘new normal’ of business? How will Business Schools create the leaders who can not only survive, but also thrive, in uncertain business conditions? And how are boundaries being pushed in terms of creativity in theory and practice at Business Schools? 

A panel of leaders working at the forefront of global innovation shared their take on these challenges and offered solutions as part of the AMBA & BGA Festival of Excellence. 

Chairing the panel was Simone Hammer, Global Marketing Director for Learning and Training Solutions at Belgian tech company, Barco. She introduced the conversation by explaining: ‘We can see as a solution provider that there has been very quick adoption [of new technology] that we didn’t think was possible. So very often in the education sector, faculty or teachers were thought to be technology adverse but the pandemic has meant that they have had to think of a different solution. That’s what we call digital enablement and now we are looking into digital transformation.’ 

Bodo Schlegelmilch, Chair of AMBA & BGA and Professor of Marketing at WU Vienna, agreed. ‘The Covid crisis has been a very big accelerator. We had a number of tendencies which were already visible – for example, more online teaching,’ he said, before adding that the pandemic had brought about, ‘a sudden huge field experiment, into which everybody had to be dragged. We went through stages. The first stage was panic: “How do we cope and how we can we do this?”. The second stage was: “This has worked quite well, so let’s experiment a little bit and make it better.” Now what we’re observing is that [Schools] are starting to become much more familiar with technology and are willing to try things out. This is an attitudinal change where they say: “Zoom is fine but what can we do in addition? Can we use virtual reality or AI in order to tailor the programme for the specific needs of students when they come in?” There’s much more willingness to explore what is possible and this attitudinal change has been very important.’

The coming stratification 

Innovations and disruption in the wider business arena have been widespread and this has also impacted on business education. The thoughts of PwC’s Director of Artificial Intelligence, Rob McCargow, chimed with those of Schlegelmilch. ‘We’ve all been dragged into this massive field experiment and everyone had to pivot to remote working within 24 hours,’ said McCargow. ‘At PwC, we had to move our 300,000 people to a remote setting immediately and this has accelerated many of the digital transformation programmes we were building. In some cases, things that had been on the roadmap for four years [from now] have been dragged to immediate action, which has been really quite exciting. 

‘This has been radical innovation by necessity – not by aspiration – and that’s been an exciting place to be. I keep hearing the phrase, “when we get back to normal,” but if we’re being candid, there is no getting back to normal now and we will see a stratification of companies that have a different mindset about the return to normal, post-Covid-19. There will be some laggards who will be desperately trying to get back to a semblance of normality and wishing to adopt the same format as before the pandemic, but at the other extreme, we will see companies entirely reinventing their business model. We’ve already seen companies disinvest from their real estate portfolio entirely and work to a fully virtual setting. The reality [for most], though, will be somewhere in the middle. PwC is going to be radically different, but we still need to have some face-to-face contact. 

‘My biggest concern is the more junior staff coming into the workplace for the first time. We have to cater for them properly and enable the ability to build social cohesion and social capital. We can’t go too far down a digital track immediately and forget about that essence of humanity.’ 

Finding the right balance

On this point, Manisha Mistry, Head of Digital Culture at Rolls-Royce, explained that more innovative approaches to business education will produce more innovative graduates, and that both Schools and employers will need to adapt quickly to make the most of a creative, tech-savvy stream of talent. 

‘There’s a real balance now that I think organisations, in my experience, are working out how they can allow these [tech-savvy] people to come into a world that we’ve cultivated over years of experience and built to a point where we’re safe in the sense of where we’re operating. We know we need to shift but [these people] are used to volatility; they’re used to changing direction instantly without worrying about all the predicating processes, models or practices around them. They have to do that with us – not to us – and these are the kinds of new areas of focus I think we’re going to need to start seeing coming through Business Schools.’

Frank Salzgeber, Head of Innovation and Ventures, ESA Space Solutions, European Space Agency, summed up the session by voicing his support for the notion of ‘social capital’ to enable innovation: ‘Everybody has a kind of social bank account. When you become older, your career is fuller, and you can really use these connections. If you’re younger, you have to fill up [the account] somehow. While they will also have to do this face to face, we have to see how we teach students that they can do this online. The challenge is to adapt our soft skills to make them work in a digital format.’

Chair: Simone Hammer, Global Marketing Director, Learning and Training Solutions, Barco

Panellists: Rob McCargow, Director of Artificial Intelligence, PwC; Manisha Mistry, Head of Digital Culture, Rolls-Royce; Frank Salzgeber, Head of Innovation and Ventures, ESA Space Solutions, European Space Agency; Bodo Schlegelmilch, Chair, AMBA & BGA; Professor of Marketing, WU Vienna

This article was originally published in Ambition (the magazine of BGA’s sister organisation, AMBA).

Are subscription models the solution for Business Schools?

Business Impact article image for Are subscription models the solution for Business Schools?

Building on his notion of ‘degrees for rent’, AMBA & BGA Chair, Bodo Schlegelmilch, outlines why a subscription model could be the game changer traditional Business Schools need, before considering the significance of alliances in an increasingly heterogeneous landscape

There is no ‘typical’ Business School. Consequently, general predictions and critiques of Business Schools may apply to some types of Schools, but not to others. 

There is a myriad of different types of Business Schools: private and public; self-standing and embedded in larger universities; theoretically oriented and managerially oriented; religious and secular; small and large; degree awarding and non-degree awarding; those that offer executive education and those that don’t. It is therefore important to define carefully the type of institution for which one attempts to make predictions.

However, if we focus on Business Schools that hold at least one of the three major accreditations (AMBA, AACSB or EQUIS), how to adapt to new market realities is a central question. I believe that these Business Schools are increasingly facing business model competition.

Business model competition requires thinking outside the box, and so, as an example, why not consider a radical idea? Future Business Schools could follow the trends in many parts of the digital economy and move from offering ‘degree ownership’ to offering a subscription model in which qualifications would expire unless graduates demonstrate a commitment to continuous professional development.

For degrees with a leaning toward practical knowledge, such as marketing, the argument for granting a degree with an expiry date is particularly strong. Rapid environmental changes, primarily driven by technological advances, call for a continuous updating of knowledge. To this end, a subscription model for degrees would just be a logical extension of the continuous professional development already required in some other professions, such as medical practitioners.

Potential financial benefits of a subscription model

For Business Schools, a subscription model could offer an interesting financial perspective. For one, regular moderate subscription rates could add up to substantial lifetime customer values for Business Schools. From a student perspective, the model could also arguably be more attractive than ‘buying’ a degree and paying that degree’s tuition fees in one lump sum. Spreading the financial burden of a Business School education more evenly over one’s entire career would make tuition fees more palatable, especially when taking into account that yearly earnings are likely to increase as one’s career progresses.

These financial considerations lead to the troubling issue of Business School economics. Traditional Schools have an inherent problem – with research and administrative obligations, it’s possible that full-time professors – albeit, depending on institution, seniority, and country – may only spend a small proportion of their time teaching. Assuming a 40-hour week and calculating a generous seven weeks of vacation, a university professor might spend at best 300 hours, or as little as 120 hours, of their 1,800 hours of annual work time in class.

This model makes teaching rather expensive. Nonetheless, top Schools are able to pass these high costs on to their students by charging tuition fees. It is well documented that MBA programmes can run well in excess of $100,000 USD, or even $200,000 USD when factoring in living costs. 

However, for all but the very top institutions offering business degrees, this is rapidly becoming unsustainable. Moreover, the spiralling tuition fees lock out talented candidates for whom such costs are out of reach. A more even distribution of costs during an individual’s working life may be an alternative that also has merit from a perspective of social equity and fairness.

Building customer relationships

The potential advantages of a subscription model go beyond financial aspects. It could also open a path for Business Schools to establish deeper and longer-term relationships with their customers. Such relationships offer an inherently more intensive mechanism for knowledge exchange between practitioners and academia than a traditional exchange between students and professors.

In this scenario, professors could tailor their teaching to the specific needs faced by managers at different stages of their careers and, thus, increase the relevance of the knowledge provided. Senior managers could, in return, share more insightful practical knowledge with professors than young, and often inexperienced, degree students are able to. Such exchanges could also inspire more attention to practical relevance in academic research. This would constitute a win–win situation for both Business Schools and their customers.

While a change to a subscription model would constitute a radical shift, most Business Schools currently seek to optimise potential by less far-reaching options. In their quest to reduce teaching costs, there is often an attempt to optimise delivery. This typically includes the use of clinical or practice-based faculty – essentially lecturers that are freed of research obligations. Blended learning or flipped classrooms can further improve the bottom line if less costly tutors can, at least partly, replace expensive full-time faculty.

In such models, individual students, or groups of students, work through a variety of tasks and teaching material outside class and only need attend the campus for a substantially reduced number of face-to-face teaching hours. While these cost reductions seek efficiencies within the existing Business School model, they fail to question the rationale of the model itself. 

The importance and complexity of alliances

A less radical, but still substantial, change in the business model of Business Schools is the increasing importance of alliances, both between and among different Business Schools and between Business Schools and technology partners. Many alliances are technologically motivated and simply reflect that Business Schools cannot manage the substantial development costs of technology platforms themselves. Others, such as the Global Alliance in Management Education (CEMS) network, are motivated by the desire to offer students more international choices and a superior learning experience. 

A relatively recent example of a primarily technology-motivated platform is the Future of Management Education (FOME) Alliance which aims to provide a common standard that enables the sharing of new technologies and pedagogies across its member institutions. A major objective of the collaboration is to challenge the perception of digital education as a lesser alternative to classroom teaching.

Although there are a growing number of Business School collaborations of varying intensity, most Schools find partnering with the heterogeneous group of technology providers from outside the traditional industry something of a scramble. University College London, for example, launched an online MBA in partnership with 2U. There are also hybrid collaborations between Business Schools and technology platforms. Arizona State University, edX, and MIT, for example, offer a master’s degree in supply chain management and claim to offer the world’s first stackable, hybrid graduate degree programme. 

The danger of tech-platform takeovers

With the advent of MOOCs, the competitive dynamics start to shift from competition between individual Business Schools to competition between networks. These networks include web giants such as Google, publishers such as Pearson, and a whole range of companies that team up to design and distribute educational content. From a Business School perspective, the danger may well be that its brand power erodes when they offer courses through a platform. Large and increasingly dominant technology platforms may become better known than individual Business Schools. For example, students may focus on Coursera when they buy a course and not on the School providing the course. This would parallel consumers who say they buy something from Amazon rather than from the vendor supplying Amazon. Student affiliation may switch from Business School to platform, a threat that appears particularly relevant for Schools with weaker brands.

Business Schools may also forge alliances with consulting companies expanding their digital learning offers, such as the McKinsey Academy or Deloitte University. These companies do not (yet) have the right to grant degrees and typically only offer a certificate on completion of their courses. Ultimately, however, it is debatable whether a certificate from a prestigious consulting company, such as McKinsey, or a degree from a relatively unknown middle-of-the-road university bears more currency. 

In short, Business School education is becoming more heterogeneous as traditional Schools become increasingly entwined with other institutions.

The growing importance and complexity of alliances in business education is further evidenced by collaborations between corporate universities and traditional Business Schools. Take, for example, Sberbank Corporate University in Russia. Sberbank has built a large and impressive campus where they not only train their own employees but also those of selected partner companies.

In this process, Sberbank Corporate University teams up with INSEAD and London Business School – strong brands obviously still count – and makes use of learning material from the Khan Academy. Sberbank and other nonconventional Business Schools use a fly-in faculty model, which saves them the expense of full-time professors. In this way, while students at such institutions may well benefit from excellent professors with up-to-date research records, other Business Schools pay for the research time of these professors.

Cosmetic change is insufficient

The myriad of competitive challenges facing traditional Business Schools demand business model innovations. Some innovations may be radical, such as moving to a subscription model, while others will centre on forging networks, primarily to cope with increasing technological requirements. There is now increasing competition from outside the industry by consultants, publishers, and IT companies, and there are increasingly competitive corporate universities. In addition, there are Business Schools that are system integrators with minimal overheads and no research expenditures that rely primarily on a fly-in external faculty model. 

All this suggests that, for traditional Business Schools, the time for ‘business as usual’ is over. A few cosmetic changes to an existing business model will be insufficient for survival. In particular, those Business Schools that are not among the top aspirational brands will need to adopt alternative business models or risk falling foul of the paradigmatic changes in the business environment.

This article is taken from Business Impact’s sixth edition in print and has been adapted from a wider discussion – entitled ‘Why Business Schools Need Radical Innovations: Drivers and Development Trajectories’ – in the Journal of Marketing Education (2020)

Bodo Schlegelmilch is Chair of the Association of MBAs and Business Graduates Association (AMBA & BGA) and heads the Institute for International Marketing Management at WU Vienna. For more than 10 years, he served as founding Dean of the WU Executive Academy.

Avoiding irrelevance and moving forward with innovation

Does your business risk irrelevance? It will soon if three fundamental innovation perspectives are ignored, says Berlin School of Business and Innovation’s Alexander Zeitelhack

In recent years, innovation has become a hot topic and a leading approach with regards to technology, and across many other sectors. The need for innovation and the forms it assumes are a fast-changing reality, calling for adjustments and an ability to adapt from those who are looking to make the most of this.

This article offers three different perspectives and some useful pointers to guide you through some of the still-uncharted territories of innovation.

Three key perspectives on innovation

1. There is the need for a different approach to the way we look at things in day-to-day life. When we try to solve the same problems every day, with the same methods and tools, we are ignoring the need and request for progress.

Everything around us is evolving and developing, and we need to be aware that we cannot survive with the ‘endless growth model’ of economy, as firstly, we’d run out of resources, and secondly, there will be no real improvement.

2. Looking at things we cannot account for, whether this is in business or life. These unknown elements are our enemies. Should our competitors find one of those, we could easily be replaced in the marketplace. Innovation, creation and management are the minimum protections against this threat. Combined, they can help to identify potential issues before they arise and, most importantly, allow them to be dealt with in an effective manner.

3. An invitation to broaden our horizons and outlooks. In society, there is always a need for a specific product or service, and then there is the solution, or product, that fulfils this need. This means that if we only look at what we do (inside), then we will miss what is needed on the outside. This would be a failure to reach out to both existing and potential audiences and customers, affecting our results.

Ignoring any of the three perspectives above can culminate in a loss of relevance among people and consumers. This happened to the music industry when it tried to ignore MP3 technology, and it will happen to businesses that ignore climate change.

Investing in innovation

With its ever-changing nature, it might be difficult to identify precisely how much businesses should invest in innovation. This doesn’t only apply to infrastructure, but also to a variety of elements that make for a successful business.

A business should make projections for the market size of a future market segment that it wants to explore, a bit like real estate development. Then the future profit in that segment can be calculated and, I would advise, a fivefold increase of annual profits can be planned.

A business should create a story, or narrative, for its corporate culture to attract more young entrepreneurial thinkers. This will have an effect on employer branding and internal competitiveness.

Having a clear focus on diversity – of gender, culture, language, and age – is also important. For example, younger hires that are grouped into teams with senior management might be able to convince with determination and motivation, in spite of their relative lack of experience.

It’s also a good idea to create a working space that looks and feels different, and that can become a factory of ideas. It’s worth investing in a great architect as well as hiring agile coaches and design thinking experts to lead innovation teams.

Unleash talent

For any business that is looking to make the most out of the competitive advantages of optimising operations to drive innovation and creativity, it’s imperative to begin by getting the next generation of creative, global and diverse-minded managers on board.

Make your innovation process the home and castle that these emerging talents need and don’t let the future leave you behind.

Alexander Zeitelhack is Associate Dean at Berlin School of Business and Innovation (BSBI).  He has also been teaching media management, future research and social entrepreneurship at Nuremberg Institute of Technology for 25 years, where he held the position of Managing Director from 2009-2013.

Defining innovation – part 2: a fresh perspective on what innovation means

The fact is, innovation is (relatively) easy to define, but it is notoriously difficult to achieve, as Dave Richards finds out

The concept of ‘value’ embraces commercialisation, commercial success, wealth, utility, adoption and wellbeing, but in a way that doesn’t unduly limit our definition or thinking about what constitutes innovation.

‘Value’ is a more comprehensive psychological construct than utility. Humans can value, appreciate and love things that aren’t useful.

Another key reason to place the concept of value at the heart of innovation is to consider your why, what and wow. Why does your organisation exist? What does it deliver in the world? What’s your ‘wow factor’ that makes your brand or offering stand head and shoulders above others? Would anyone care if your organisation tipped over its collective shoelaces and died?

The essence of any organisation is its business model. At the core of any business model is a product – whatever good or service the enterprise produces that is intended to be of value to someone, usually thought of as the ‘customer’. The rest of the business model is simply whatever the enterprise does to produce the product, and whatever it does to get the product into the hot little hands of the intended customers. In its simplest form, a business model is simply about manifesting value in customer experience.

Of course, in reality, most organisations deliver a complex product portfolio, but we can nonetheless think of whatever is produced as the ‘product’. Further, there might be incredibly complex international supply chains, distribution channels, sales and marketing, and much more involved, but at its essence, a business model consists of these three simple elements. We can also use the term ‘value delivery model’, especially when considering public or social enterprises that might not like to think of themselves as businesses.

The concept of ‘customer’ is also somewhat complex. Whether this customer is a paying consumer or the recipient of charity or public services, they are nonetheless a ‘customer’. And sure, there is some psychological complexity here, in that some customers might be users, while others might be choosers (or buyers), influencers, all three, or any combination. Further, there is typically an incredible level of diversity of customer experience resulting from even the simplest of products, let alone complex product portfolios delivered in a wide variety of ways. Life is complex.

Given the above – that any enterprise should exist to create and deliver value to customers – the best definitions of innovation are ‘fresh thinking that creates value’ or ‘people creating value through the implementation of ideas’ or ‘something new that delivers value to the world’ – recognizing that the concept of ‘value’ must therefore also be clearly and unequivocally defined to fully understand what we mean by ‘innovation’. So, what is value?

Value is a psychological experience, or perception. Value is not absolute, and it’s not equivalent to money. Money, after all, is a human construct designed to enable commerce, trade and wealth. But if you think about it, even when money was made with precious metals, there was nothing inherently valuable about it, other than the value people placed in it based on their expectations for how they might use it. Value is more about love than money. Sure, people pay for love (some more than others), and will pay much more for something they truly love than something that is merely useful. Even the concept of money is psychological, and the value humans place on various forms of currency is also based on their perceptions, expectations, hopes and fears – all psychological phenomena.

Based on all of the above, I offer this definition:

Innovation is the realisation of net new value as experienced by people, resulting from the implementation of ideas (by the same or other people) for value creation.

The degree of innovation success at any given point in time is measurable return on investment (ROI) – the value created relative to the value (time, money, effort or other resources) invested to create it. ROI is usually expressed as a ratio, or percentage:

Innovation ROI = (Value Created – Value Invested) / Value Invested

Whether or not, or to what extent innovation is considered ‘successful’ is therefore a relative judgment. The level of ROI considered ‘acceptable’ by any given organisation, board, or investor will depend on other investment options, and perhaps other strategic considerations.

Being able to agree upon measures of value is critically important both for conversations about innovation, the development and implementation of innovation strategies, and of course the assessment of innovation results.

Money (commercial success, costs, budgets, profits) is of course a common and relatively easy way to measure perceived value – as it’s constantly tied and correlated to value experience in real time, in various local and global markets. But as alluded to above, if we focus only on money as our measure of psychological value, we might miss very important nuances. Leading organisations have learned that measures of customer experience, loyalty (e.g., net promoter scores) and love (of brands, products, etc.) can be vital for predicting and measuring success or failure. Four key concepts to bear in mind: (1) garbage in, garbage out; (2) not all that can be measured is important; (3) not all that’s important can be measured; and (4) the devil is in the detail.

Let’s end this series by defining another term – ‘unnovation’ – to refer to cases where the ROI is negative, negligible or simply disappointingly low. The fact is, innovation is (relatively) easy to define, but it is notoriously difficult to achieve, as witnessed by the fact that innovation success rates are very low (less than 10%) across all types of enterprises and industries globally (Dobin Group, 2012; Richards, 2014; VIIMA, 2018).

Dave Richards is Co-Founder of the MIT Innovation Lab, and a highly acclaimed author, speaker and consultant on strategic innovation leadership. He is the author of The Seven Sins of Innovation: A Strategic Model for Entrepreneurship  and holds a PhD in mathematical psychology and neuroscience from the University of Toronto.

Defining innovation – part 1: why the definitions of innovation that you know might be flawed

We need to think beyond commercialisation and wealth creation to embrace concepts such as utility and wellbeing. But do we require so much complexity to define innovation? Dave Richards Investigates

Many organisations are talking about innovation, without any real clarity or common definition, leading some people to conclude that innovation is just a buzzword that we should stop trying to have serious conversations about.

But that naïve conclusion misses a vital truth. Deeply understanding what innovation is all about enables global industry leaders to establish and maintain superior performance, competitive advantage, and winning strategies for long-term value creation.

Members of the MIT Innovation Lab (which I cofounded in 1993 and codirected until 1996) clearly demonstrate this understanding in everything they do.

3M is a great example – a company with a mission of innovation, an unparalleled infrastructure of technology platforms upon which to build new solutions, and a consistent track record of delivering superior customer value, which of course translates into value for other stakeholders. Some people might choose to ignore conversations about innovation – and do so at their peril. Phrases such as ‘innovate or die’ come to mind.

Do you know the ‘official’ definition of innovation, mainly used (not very well) by governments to measure and monitor national and regional levels of innovation?

The Organisation for Economic Cooperation and Development wined and dined hundreds of academics and civil servants in one of the world’s most expensive cities, Oslo, for weeks to come up with it. The resulting ‘Oslo Manual’ definition of innovation is ‘a firm connecting something new to a marketplace’. This definition is fatally flawed for three reasons:

1 Only ‘firms’ can innovate, such that innovation within public or ‘third’ (charitable) sectors is (by definition) impossible – which hopefully we all agree would be a bad thing.

2 Anything ‘new’ to a marketplace is viewed as innovative. But should we really accept that anything ‘new’ is ‘innovation’? What about a new strain of flu, accidentally unleashed by a company trying to create a vaccine? What about the Edsel – a very new car design introduced by Ford in 1958 – a spectacular market flop? And what about, or Come on now!

3 Again, because only ‘firms’ can be the authors of innovation, users are precluded from driving or contributing to innovation, even though a considerable body of research (see von Hippel, at MIT) shows that users are often the first to come up with ideas for innovation, and that they frequently modify the products provided by firms to make them more useful and fit for purpose (e.g., surgeons modifying surgical instruments).

Luckily for us, there are many far cleverer definitions of innovation offered by various experts, none of which resulted from expensive boondoggles at taxpayer expense:

  • ‘Innovation is the specific instrument of entrepreneurship. It is the act that endows resources with a new capacity to create wealth’ (Drucker, 1985).
  • ‘Innovation = Invention + Exploitation’ (Roberts, 1987).
  • ‘The starting point for innovation is the generation of creative ideas. Innovation is the process of taking those ideas to market or to usefulness’ (Ijuri and Kuhn, 1988).
  • ‘New ideas – plus action and implementation – which result in an improvement, a gain or a profit’ (3M’s definition, according to Kelley and Littman, 2006).
  • ‘People creating value through the implementation of ideas’ (attributed to the Innovation Network, by Kelley and Littman, 2006).
  • ‘New products, business processes, and organic changes that create wealth or social welfare’ (attributed to the OECD, by Vaitheeswaran, 2007).
  • ‘Fresh thinking that creates value’ (Lyons, of Goldman Sachs, attributed by Vaitheeswaran, 2007).
  • ‘Innovation is new stuff that is made useful’ (McKeown, 2008).
  • ‘Innovation is the conversion of knowledge and ideas into a benefit, which may be for commercial use or for the public good; the benefit may be new or improved products, processes or services’ (attributed to Smallwood by Waschke, 2011).
  • ‘Note the difference between invention and innovation: invention is the creation of a new idea or concept – innovation is taking that idea, reducing it to practice, and making it a commercial success’ (THECIS, 2014).
  • ‘Executing an idea which addresses a specific challenge and achieves value for both the company and customer’ (Skillicorn, 2016).
  • ‘Something new or different that delivers value to the world, with the key criteria that I’m not innovating if I’m not bettering people’s lives’ (Barba, 2019).

Is innovation the successful commercialisation of ideas?

That’s a measure of innovation success for commercial enterprises. But again, what about non-commercial enterprises, and what about users adapting products to better meet their needs, perhaps without commercial motivations?

Clearly, we need to think beyond commercialisation and wealth creation to embrace concepts such as utility and wellbeing. But do we require so much complexity to define innovation?

Isn’t there a single concept that embraces commercialisation, commercial success, wealth, utility, adoption and wellbeing?

Look out for part two of this series, next week, to find out.

Dave Richards is Co-Founder of the MIT Innovation Lab, and a highly acclaimed author, speaker and consultant on strategic innovation leadership. He is the author of The Seven Sins of Innovation: A Strategic Model for Entrepreneurship  and holds a PhD in mathematical psychology and neuroscience from the University of Toronto.

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