BUSINESS111 Chap.12 Creativity, Innovation and Entrepreneurship
Creativity, Innovation and Entrepreneurship
From idea to value
This chapter defines creativity as the production of new and useful ideas, explains innovation as incremental or radical, and presents entrepreneurship as a mindset that can operate inside organisations as well as through new ventures.
Four forms and the business model
It works through Bessant and Tidd's product, process, position and paradigm innovation, links each to value creation, configuration and capture, and practises the exam task of defining two innovation types and evaluating their contribution to competitive advantage.
The exam question this chapter prepares
The course's practice question for Week 10 asks you to define and explain two types of innovation, show how a business demonstrates them, and evaluate their contribution to competitive advantage.
The chapter practises exactly that, adding the business-model link that turns a description of an innovation into an argument about why it matters.
What this chapter covers
- 01
Creativity and its role in innovation
- 02
Incremental, radical and disruptive innovation
- 03
Product and service innovation
- 04
Process innovation
- 05
Position and paradigm innovation
- 06
Entrepreneurs, intrapreneurs and competitive advantage
Worked example · free
Two innovation types and competitive advantage
- 1Understanding key concepts: define two innovation types precisely.
- 8Application, analysis, judgement and justification: match each type to the facts and evaluate the advantage.
- 1Communication and structure: one clear paragraph within 250 words.
Key terms
- Creativity
- Generating ideas that are both new and useful, the process that makes innovation possible.
- Incremental Innovation
- Small, continuous improvements to existing products, services or processes.
- Position Innovation
- Reframing an existing offering for a new market or a new story without changing its technology.
- Paradigm Innovation
- A change in the core logic of a business, often called business-model innovation.
- Intrapreneur
- A person who acts entrepreneurially inside an existing organisation to change how it operates or what it offers.
- Process Innovation
- Better, faster or cheaper ways of producing and delivering an offering.
Creativity, Innovation and Entrepreneurship FAQ
What is the difference between creativity and innovation?
Creativity means generating ideas that are both new and useful; it is the enabling process. Innovation is what happens when such ideas are turned into new value through products, processes, positions or business logic. The entrepreneur is the person who takes the innovation to market.
Is incremental innovation less important than radical innovation?
Not necessarily. Incremental improvements lower costs and improve the user experience, and Canvas notes that much value lies in process innovation. Radical change matters when the old logic of a business no longer works, so the answer depends on the situation.
Which business-model components does each innovation form change?
Product and position innovation mainly change value creation, process innovation mainly changes value configuration and sometimes creation, and paradigm innovation changes all three, including value capture, for example by moving from one-off sales to subscriptions.
What is paradigm innovation?
Canvas describes it as a change in the basic mindset and core logic of a business, rethinking the rules of how it operates and why it exists. It is the deepest level of change and is often called business-model innovation, because it can alter value creation, configuration and capture together.
What is an intrapreneur?
Canvas describes corporate entrepreneurs, or intrapreneurs, as people who act entrepreneurially inside large organisations, changing how the business operates or what it offers. The idea shows that entrepreneurship is a mindset rather than only the act of starting a new firm.
Exam move
Make a four-row table for product, process, position and paradigm innovation, adding the question each changes and one example from a firm you know. Mark each example as incremental or radical and name the business-model component it moves. Then practise a 250-word answer that defines two types, applies them to a case and evaluates which gives the more durable advantage.
Finally, judge which of your examples would be hardest for a competitor to copy. Keep two well-documented examples of each innovation form in your notes. Practise naming the business-model component each innovation moves.
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