From Unnovation to Innovation

Umair Haque writes that:

“Most innovation, well, isn’t: it is “unnovation,” or innovation that fails to create authentic, meaningful value. The biggest stumbling block to innovation is unnovation: most companies are too busy unnovating to ever learn how to truly innovate.

In the race to innovate, most organizations forget a simple but fundamental economic truth. A new process, product, service, business design, or strategy can only be described as an innovation if it results in (or is the result of) authentic, durable economic gains.

Unfortunately, much of what our economy produces today isn’t innovative — it’s unnovative. The evidence is hard to dispute: we merely need to note how deep the global decline is, how consistently 20th Century business fails to do stuff that matters — or just how many industries are caught simultaneously in deep crisis.

Here are some examples of unnovation.

The Hummer was a product unnovation, which destroyed value for both society and Detroit.

CDOs were a financial unnovation, that crippled the financial system, and have cost everyone hundreds of billions.

Integrating into auto finance was a business design unnovation for Detroit — one which diluted and sapped the incentives to make authentically innovative cars.

Hedge funds are (probably) a management unnovation. Industry structure, fee structure, and well, the giant financial meltdown of 2009 all suggest that hedge funds create little value, and are simply capturing it instead.

Windows was, many years ago, an innovation. Today, it’s an especially toxic unnovation — one which is actively stifling the development of an operating system that’s not the software equivalent of an Edsel.”


Umair then gives two examples in 2 additional blogposts, a negative one of unnovation, i.e. the Hummer, and a positive one, Twitter:

* Twitter’s Ten Rules For Radical Innovators – Umair Haque …

Twitter is one of the world’s most radical management innovators. It’s revolutionary because it brings 21st Century DNA roaring raucously to life: it is a living expression of the new principles of organization and management we’ve been discussing. Here are Twitter’s ten rules for radical innovators (which have, just maybe, had a bit of influence when it comes to Twitter).

* How Not to Hummer Your Business – Umair Haque

Detroit is self-destructing because it produces unnovative cars. They were profitable in the near-term, thanks to the last vestiges of Detroit’s historical market power. Yet, by failing to answer the challenge of creating authentic value, Detroit has destroyed its own ability to innovate for the long-term. The crisis of nihilism means: the numbers we utilize to make decisions today don’t reflect economic reality. It’s as true for banks as it is for cars. The Hummer is an economic weapon of self-destruction, for society, people, the environment, and, of course, auto-makers — yet, because it was chasing near-term “profit”, instead of authentic value, GM kept churning them out even as it faced a battle for its own survival. To not fall into the Hummer trap, think constructively — how will you build a better tomorrow?”

1 Comment From Unnovation to Innovation

  1. AvatarDan

    To say that innovation is a new idea that results in an economic outcome is like trying to solve one equation with 4 unknowns (what is: new, authentic, meaningful, value)- impossible by man or machine. This definitions for sets us up for failure before we even start. When “your” innovation does finally roll off an assembly line, it can only be viewed as such in retrospect. The mainstream definition for innovation is in fact the mother of all unnovation.

    The thing rolling off an assembly line is an invention. All human acts and ideas that increase net human productivity are innovations. Money is backed by productivity. Debt is a promise against future productivity. Innovation is also promise against future productivity. While not all ideas become inventions, all inventions are built upon thousands of ideas.

    Keep in mind that information, knowledge and innovation are deeply related as mathematical derivatives. Innovation is derived from knowledge and is proportional to the rate of change in knowledge. Likewise, knowledge is derived from information and is proportional to the rate of change of information. Therefore, if I want to identify the fact of innovation, I simply seek the rate of change of knowledge as a proxy.

    The mainstream definition for innovation does not permit analysis as any good definition should and ought to be re investigated.

Leave A Comment

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.