Unlabeling Innovation

The Segway personal transporter was unveiled on December 3, 2001, among intense hype. It was claimed to be so innovative that it would transform how humanity thought about transportation. Inventor Dean Kamen famously said it "will be to the car what the car was to the horse and buggy." Nine years later Time Magazine put the Segway on the No. 1 spot of the worst 50 inventions, beating out classic failures like New Coke, Microsoft Office's "Clippy," Agent Orange, CueCat, and Subprime Mortgages.

We constantly label things. Fast, slow, smooth, silky, impressive, improved, and so forth. We use labels to convey specific meaning. Labels are an important way for us to communicate and understand each other. But what happens when the label we use is inaccurate or causes confusion?

The term innovation as a label has been increasing in use for many decades. Similar to past business trends in quality, strategy, project management, six sigma, lean, and agile, innovation has become a corporate boardroom topic. Unlike past trends, innovation is being used to predict (hope for) a result instead of describe an outcome. Calling an idea, invention, prototype, pilot, or new product an innovation is an exercise in spin. More critically, it causes confusion and costly disruption to business objectives and long-term success.

Innovation Is a Result, Not a Prediction

What does the story of the Segway tell us about the term innovation and how it shapes our understanding of what it labels? What is 'real' innovation? It is easier to agree that inventions like the moveable type printing press, telephone, automobile, and computer are innovations; that new market models like $0.99 digital songs and apps, online auctions, and e-commerce are innovations. It is also easy to agree that New Coke, subprime mortgages, the parachute jacket (the inventor died while jumping from the Eiffel Tower in 1912), and baby cages are not innovations. But what about the Segway? It did not reshape civilization as predicted. Is reshaping civilization the definition of innovation?

The Segway reveals the first problem with using innovation as a predictive label. In order to be an innovation, the thing in question has to first, 'be useful,' and second, 'create value.' In order to see, understand, and agree (or disagree) about whether or not something is an innovation, we need to see and to some extent, quantify, the result. New Coke was useful (if you were thirsty) but it did not create value (Coke lovers were not "Coke Lovers" if they liked New Coke). Subprime mortgages were useful (many people got first mortgages or equity out of the recent increase in home values) but they did not create value (being fundamentally responsible for the greatest global economic crisis in history). The parachute jacket was not useful (unless the user intended to commit suicide).

Innovation is a good and accurate label only when it describes a result. Using the word innovation before usefulness and value have been tested is like calling water "dry" and the sky "skinny." Neither label makes sense.

"Innovation is the result of a new product or strategy in action and merely predicting that it will be an innovation does not make it an innovation."

Innovation Is a Continuum

In September 2013, Apple released the iPhone 5c and iPhone 5s. If one has paid attention to the development of the iPhone since its inception in 2007, the incrementally better iPhone 5s compared to the iPhone 5 should not have surprised anybody. And yet, similar to the reactions to the iPhone 3GS, 4, and 4S, many technology journalists and enthusiasts proclaimed that innovation is dead at Apple. This position that 'incremental' or 'evolutionary' is not innovation is another problem with the label of innovation.

If you compare a Mercedes Benz manufactured in 2014 with the Benz Patent-Motorwagen introduced in 1894 by German inventor Karl Benz, the differences are staggering. Considering that those differences "evolved" over 120 years, at the hands of hundreds of companies and thousands of engineers, entrepreneurs, and inventors, into what we recognize today as the automobile, one cannot easily discount the value of incremental changes over time. Most innovation is unimpressive and incremental. And yet many of these small changes add up. Is the new fingerprint reader on the iPhone 5s useful? Not yet. Is the faster processor and better camera useful? When it enables better apps by developers and better photos by users, then Yes. The iPhone 5s is unquestionably better than the first iPhone.

This point flatly denies that there is something called "real innovation," that only includes major break-through moments like the Gutenberg press, telephone, light bulb, radio, television, computer, smartphone, and other "obvious" inventions. Instead, innovation happens along a continuum of change that includes small but meaningful improvements to products, services, processes, strategies, and systems, up through radical changes that alter or create new markets. This continuum acknowledges that, as a result and not a prediction, when changes occur that are incremental, sustaining, evolutionary, revolutionary, disruptive, and radical, that they are all part of a spectrum of useful value creation that can only be called innovation in retrospect.

Peel Off the Label

Most customers do not care about innovation. They seek value. When we proclaim success (calling something innovation before usefulness and value are proven), we do ourselves and our customers a disservice. The label of innovation is being applied by product managers, marketing executives, and CEOs as a way to convince us that their new thing is worth something. Let's unlabel innovation and start paying attention to usefulness and value.

"Do a set of ideas define innovation or a set of outcomes classify innovation?"

"Can you think of something that is generally accepted as innovation but is neither useful nor creates value?"

2026 postscript: Segway ended production of the personal transporter in July 2020. Eighteen years of predictions, and the label never became a result. The argument stands.