This document summarizes key concepts from a lecture on innovation and entrepreneurship. It defines entrepreneurship as shifting resources to higher productivity and innovation as creating new value from existing resources. Successful companies foster innovation through practices like rewarding innovators, dividing into autonomous divisions, and changing rules to support innovation. National policies that promote creative destruction and sunset laws can encourage innovation more than central planning. The presentation emphasizes that both social and economic innovations have the most impact and discusses characteristics of innovative companies and strategies for different types of innovators.
4. Definitions
• Entrepreneurship – “shift of economic
resources out of an area of lower to higher
productivity of greater yield.” J. B. Say
1800
• Innovation – “creating value out of existing
resources.” A specific tool of
entrepreneurship.
They go hand in hand!
7. NEW VALUE FROM EXISTING
• Entrepreneurship – “destroying old order
and creating something new.” Schumpeter
• Innovation – innovare to make new
- creating value from existing things
processes
- not just new things; they have to be
NEW VALUE
8. Types of innovation
• Technical
• Social
• Economic
Most innovations are social and economic.
THEY HAVE THE MOST IMPACT!
13. Characteristics of innovation
• It is hard work
• It is systematic
• It focuses on opportunities; not problems
• It is focussed
• It is customer-centric
• Its effect is felt in the economy and society
14. Practices of innovative companies
1. Responsibility for innovation
2. Rewarding innovators
3. “Hiving off” – divisionalisation
4. Changing corporate rules to nurture
innovation
36. What will work?
CREATIVE DESTRUCTION OF
THE OBSOLETE:
• New tax laws that will favor sale
of non – performing assets.
• Sunset laws for obsolete gov’t
agencies.
46. acknowledgement
• The picture and photographs are from
Google images;
• The bulk of the presentation are
interpretation of the work of Peter
Drucker’s book on innovation and
entrepreneurship. (creative innovation?)