Last month, I had the chance to sit down and talk to Farhat Ali, the previous President and CEO of Fujitsu America, as well as a member of the Princeton Class of 1977. Our talk spanned everywhere from topics like combining business school with a technical degree, to appropriately managing a startup. However, I think one of the most interesting pieces of insight I got from Farhat was his explanation of the difference between “invention” and “innovation.”
Strictly speaking, an invention is some novel creation — U.S. patent law defines it as “a new, useful process, machine, improvement, etc., that did not exist previously and that is recognized as the product of some unique intuition or genius, as distinguished from ordinary mechanical skill or craftsmanship.”
Innovation, on the other hand, is the act of identifying a market need and then connecting the user base with an invention. Innovation is a much more complicated action, requiring the entrepreneur to not only orchestrate and lead the creation of a new invention, but also to have the foresight and experience to effectively target and market to a consumer group.
For the sake of example, let’s talk about Apple: the iPhone itself was an invention, but Steve Jobs epitomized innovation — he (along with several others who don’t get enough credit) invented a suite of products which intersected with a market desire for these electronics, and established a devoted, cult-like following to his company. Of course, it’s hard to discern the direction of causation in this story — whether Apple identified the consumers’ desire for its products and then created its suite of products, or if Apple created a superior product that generated user interest — but it is clear that innovation is the marriage between technical acumen and business-savvy.
All this leads to my point, which is that too many young entrepreneurs today seem to lack the requisite maturity and insight needed to create a successful product. I recently read a post from Sunil Rajaraman on the unbridled (and naive) enthusiasm of some entrepreneurs in Silicon Valley, and he painted this picture of many startups:
“Your 27-year-old CEO calls an ad-hoc all-hands meeting and regales about company culture and how your mission is to ‘kill email because it’s broken.’ He wants to make every enterprise company in the world switch to your product. He’s never worked for an enterprise company, or any other company at all.”
Ultimately, after my experiences talking to entrepreneurs and working with startups, I’ve decided that if I want to run my own successful venture in the future, the first step I need to take is to learn: to learn about how a real, successful organization runs its business, and to develop an understanding of a niche problem-space that I can explore and specialize in. Only then will I begin to be adequately prepared to take on such a challenge.