What is innovation?

The word innovation derives from the Latin word innovatus, which is the noun form of innovare "to renew or change. Innovation is the creation of better or more effective products, processes, services, technologies, or ideas that are readily available to markets, and society. Innovation differs from invention in that innovation refers to the use of a better and, as a result, novel idea or method, whereas invention refers more directly to the creation of the idea or method itself.

There are several sources of innovation. According to the Peter F. Drucker the general sources of innovations are different changes in industry structure, in market structure, in local and global demographics, in human perception, mood and meaning.Meanwhile Programs of organizational innovation are typically tightly linked to organizational goals and objectives, to the business plan, and to market competitive positioning. These goals vary between

improvements to products, processes and services and dispel a popular myth that innovation deals mainly with new product development. Conversely, failure can develop in programs of innovations. The causes of failure have been widely researched and can vary considerably. Some causes will be external to the organization and outside its influence of control.

Several indexes exist that attempt to measure innovation. One of this is the Global Innovation Index. This international innovation index is one of many research studies that try to build a ranking of countries related to innovation. The global innovation index looks at both the business outcomes of innovation and government's ability to encourage and support innovation through public policy. The report discusses not only country performance but also what companies are doing and should be doing to spur innovation. To rank the countries, the study measured both innovation inputs and outputs. Innovation inputs included government and fiscal policy, education policy and the innovation environment. Outputs included patents, technology transfer, and other R&D results.