I was recently asked to define a number of basic innovation terms. Below are some of the most important. I would greatly appreciate your feedback. I will address the issues and thoughts you provide in future posts.
Value creation is the process of discovering and creating new knowledge to address an unmet customer, market, or societal need. Value-creation is distinguished by an intense focus on obtaining feedback and insights from potential customers and a deep understanding of the relevant ecosystem. The end goal is the development of a compelling and sustainable new offering. Engineering R&D and the incubation of new commercial ventures are examples of value-creation.
Innovation is the development and delivery of a new offering, organization, or method that has value to a segment of society. For example, the publication of CRISPR created a paradigm shift in the field of biology; the smartphone fundamentally changed how the world views human communication. Particular innovations last only as long as they are sustained by making a profit or by other means, such as through voluntary contributions. Most innovations eventually go away or are integrated into new innovations. The two definitions below are useful:
- Business: Innovation is the creation and delivery of new customer value in the marketplace, with a sustainable business model.
- Generally: Innovation is the creation and delivery of new knowledge that has sustainable value for society.
In both cases, to be significant the new customer value and new knowledge must be surprising. Generally the greater the surprise, the greater the impact.
Entrepreneurship describes the skills and personal characteristics of those who organize and bring to life a new offering, organization, or method. Entrepreneurs exhibit considerable initiative and often take substantial risks.
A Value Proposition describes those core items to be addressed in all productive initiatives, from basic research through to commercialization. The four minimum items are: 1) the societal Need to be addressed, 2) the Approach for the need’s solution and sustainability model, 3) the Benefits per costs resulting from this solution (i.e., the value), and 4) how this value compares to the Competition and alternatives. This is called an NABC value proposition.
The Business Plan for a new venture, which fleshes out the NABC Value Proposition, includes: 
- High-level vision statement – what does the venture want to achieve?
- Customer and market Need – what are the key insights into the opportunity, its size and growth rate, market trends, and potential first customers (i.e., the “beach head”)?
- Team and leadership – is it the best team for the proposed opportunity?
- Approach for the offering and business model – is it a “vitamin or a painkiller” and are both working hypotheses clear and realistic?
- Business model – how will the venture make money and be profitable?
- Investments – are the goals, schedule, and milestones for the required investments clearly identified?
- Go-to-market plan – how long and difficult will it be to make a sale?
- Demo – is there a demonstration or prototype of the offering?
- Timing – is it too early or too late and can all the elements of the venture be assembled?
- Risks – what are they, and how will they be mitigated?
- Quantified Benefits per costs – are all the potential quality, convenience, and cost attributes clearly identified?
- Competition –is the offering obviously superior to the competition today and in the foreseeable future, and what is the venture’s sustainable competitive advantage?
Value-Creation Forums are recurring team meetings to accelerate value creation. They employ best experiential learning and creating principles. Team members present short NABC value propositions to provide the framework for meaningful discussion. They then receive constructive feedback from teammates — what is incomplete or unconvincing and what is compelling and persuasive? Over time the value propositions evolve into complete business plans. Rapid learning is achieved by observing both a presentation’s failings and achievements, and by the friendly competition to excel that the forums engender.
A Value-Creation Playbook describes the concepts and collaboration processes needed for performing effective team science and successful value creation. For example, in a multi-disciplinary team, each field has its own unique language and concepts. The playbook provides a common language and conceptual framework for efficient, collaborative RD&I. Several examples of concepts included in the playbook are given above.
 C.R. Carlson and W. W. Wilmot, Innovation: The Five Disciplines for Creating What Customers Want, Random House: Crown Business Books, 2006
 H. Kressel and N. Winarsky, If You Really Want to Change the World: A Guide to Creating, Building, and Sustaining Breakthrough Ventures, Harvard Business Review Press, 2015