With the recent focus on innovation, it can be easy for any organization to become wrapped around building a better axle. However, innovation alone does not breed success. There is a battle brewing between the time tested practice of entrepreneurship and the requirements of the emerging innovation economy. The question is whether innovation or entrepreneurship can exist in this new environment without the other, finding the right mix, and understanding the difference. In this article, we explore the critical differences between and the many types of innovation and entrepreneurship, as well as how to find the balance between the two and your optimal mix for competitive advantage.
Innovation is about new ideas. It may be new products, processes, services, business models and more. Entrepreneurship, however, is about realizing profit. The difference between innovation and entrepreneurship is key. You can build it, but they may not come. Delia Smith of Green Field Ventures gives a concise view of the difference when she notes that, “If innovation is the creation of new capacities for wealth creation, entrepreneurship is the exploitation of these capacities.”
In the accelerating business environment and evolving innovation economy, differentiators are key. Your business has to be unique in some advantageous way that draws your customers. The right mix of innovation and entrepreneurship is at the heart of creating advantage in this evolving economy. Steve Epner suggests, “an entrepreneur with an innovative idea is a rare and valuable find...everyone is capable of coming up with the idea. Put that together with someone who can execute a plan—and watch out.”
To turn this trend into a competitive advantage, develop the right mix of innovation and entrepreneurship for your organization. Decide how you will encourage each kind of innovation within your organization. Next, develop entrepreneurial processes for acting on innovation. Your entrepreneurial process needs to vet ideas effectively and move them forward systematically. In other words, invest in moving forward with ideas that fit your business strategy, contribute to your company’s future prospects and are within your current means.
Lastly, reward innovation and entrepreneurship individually to keep enthusiasm high. Given these steps, your organization will be on the path to a sustained mix of innovation and entrepreneurship that will enable your to thrive and not just survive in this evolving economy.
