The seeds of of innovation management as a practice were sown by acclaimed Austrian economist Joseph Schumpeter. During the 1930s, Schumpeter coined the term ‘creative destruction’ to refer to industrial forces revolutionizing economic structures from within (a concept that would later inform the idea of ‘disruptive innovation’).
During the 1960s, business researchers began to build upon Schumpeter’s theories when analyzing the innovative behaviours of corporations. It was quickly discovered that companies within traditional and stable industries had a much more relaxed view towards innovation than those in relatively new industries (electronics, car manufacturing, etc). During this period, innovation was also mainly confined to the R&D departments of large-scale companies. The fact that only major companies could afford to sustain R&D departments dedicated to innovation also created barriers for competitive entry among smaller businesses.
This trend was blown wide open during the 1990s, with the emergence of the internet bringing with it revolutionary online opportunities for innovation management. Firms could now reach out to vast audiences and gain their feedback with unprecedented ease. The fact that software could now be scaled at a much higher speed than traditional industries also meant that innovative startups could gain a competitive edge. To withstand disruption, and keep to the pace of the digital revolution, traditional companies increasingly invested in digital ways to capture creative ideas and streamline internal innovation processes. Companies that failed to appreciate the fruits of digital innovation (such as Sears and Xerox) met with disaster, losing billions of dollars in revenue.
Today, the maxim ‘innovate or die’ rings truer than ever on the corporate landscape. The ‘creative destruction’ prophesied by Schumpeter continues to manifest itself within companies who are self-disrupting in order to meet new challenges and consumer demands. As a result, the innovation management market – comprised of companies offering tools and services to assist companies reach their innovation potential – has grown exponentially. Market Future Research forecasts that by 2023, the innovation management market will be worth approximately 1,700 Million USD globally.
With new technologies and business opportunities emerging at breakneck speed, the evolution of innovation management looks set to become increasingly dynamic in the decades to come.