Entrepreneurship, Creativity, & Innovation

Summary

This video explores the interconnected topics of entrepreneurship, creativity, and innovation. It begins by discussing creativity as a process for generating ideas and how it can be nurtured through knowledge, collaboration, and evaluation. The video highlights the importance of both individual and collective creativity, and the role of background knowledge in developing innovative solutions. It also discusses the difference between innovation and invention, emphasizing that innovation involves improving and commercializing ideas. Real-world examples, such as Borders' response to digital music, are used to illustrate these concepts.

Takeaways

• 🤔 Creativity is the process of generating ideas and can be improved with tools and techniques.
• 👥 Surrounding yourself with creative individuals can enhance the creative process.
• 📚 Having a background in the subject matter can lead to more creative solutions.
• 🧠 Creativity can be taught and learned, just like any other skill.
• 🌱 Incubation of ideas is important, but evaluating those ideas is often overlooked.
• 🚫 Avoid rushing to implement the first idea; consider multiple options.
• 🔍 Recognizing relationships between different areas can lead to creative solutions.
• 📉 Borders Books and Music's failure to adapt to digital music illustrates the danger of sticking to the status quo.
• 🧠 The balance between left-brain (analytical) and right-brain (creative) thinking is crucial for entrepreneurs.
• 🛠 Innovation is about applying new ideas or improving existing ones to meet a need.
• 💡 Invention is creating something new, but it doesn't necessarily equate to innovation or commercial success.

Q & A

What are the three interconnected topics discussed in the transcript?

The three interconnected topics discussed are entrepreneurship, creativity, and innovation.

How is creativity defined in the context of the transcript?

Creativity is defined as the process of generating ideas that can make things better, more comfortable, efficient, or effective.

What are some ways to enhance creativity as mentioned in the transcript?

Ways to enhance creativity include using tools and techniques, involving creative individuals in decision-making, having a background in the topic matter, and evaluating multiple ideas before implementing a solution.

Why is it beneficial to have a background in the topic matter when trying to be creative?

Having a background in the topic matter allows for a deeper understanding, enabling one to think more in-depth and consider past successes and failures, thus improving the generation of creative solutions.

What role does incubation play in the process of creativity?

Incubation refers to the process of letting ideas develop over time, which is often missed but crucial for refining and evaluating the quality of creative solutions.

What example is given in the transcript to illustrate the importance of recognizing relationships in creativity?

The example of Borders Books and Music is given, which considered the impact of digital music and the threat of free, pirated music from services like Napster on their business model.

What was the proposed solution for Borders Books and Music to compete with digital music and piracy?

The proposed solution was to create a vending machine in the store that would allow customers to plug in their devices and download songs directly.

Why did Borders Books and Music ultimately not adopt the vending machine solution?

Borders Books and Music did not adopt the vending machine solution due to concerns about the unknown profitability compared to their established CD sales model and the fear of cannibalizing their existing sales.

What is the difference between innovation and invention as discussed in the transcript?

Invention is the creation of something new, while innovation is the application or implementation of that invention to meet a need or improve upon what already exists.

How does the transcript define a successful innovation?

A successful innovation is defined as a commercialized idea that can be brought to market, adds value, and is recognized and purchased by consumers.

What is the importance of balancing creativity with practical considerations like cost and market demand?

Balancing creativity with practical considerations ensures that while ideas are imaginative and novel, they are also viable in terms of cost and market demand, making them profitable ventures.

Outlines

00:00

💡 Creativity and Its Role in Entrepreneurship

The first paragraph discusses the intersection of entrepreneurship, creativity, and innovation. It emphasizes creativity as a process for generating ideas that can improve or enhance products and services. The speaker suggests that creativity can be developed through tools and techniques, similar to financial or marketing planning. They also note the value of involving creative individuals in the process and highlight the importance of having a background in the subject matter to foster creative thinking. The concept of incubation and evaluation of ideas is introduced, stressing the importance of not just implementing the first idea that comes to mind but considering multiple possibilities.

05:00

🎵 The Evolution of Digital Music and Borders' Response

Paragraph two delves into the digital music revolution and how Borders Books and Music considered adapting to the changing landscape. The speaker recounts a consulting engagement with Borders in 2003, where the potential of单曲销售 and digital music was discussed. The challenge of competing with free, pirated music was a concern for Borders. The idea of a vending machine within the store that allowed customers to download songs directly to their devices was proposed as a solution to stay competitive. This idea was innovative for its time, offering convenience and immediate gratification for customers.

10:02

🚫 Borders' Resistance to Change and the Consequences

The third paragraph explores the reasons why Borders did not adopt the vending machine idea for digital music sales. Concerns about the need for cables and adaptability, the prevalence of necessary hardware, and the fear of the unknown market potential were cited as barriers. Borders was comfortable with their existing CD sales model and reluctant to change. The speaker reflects on how companies often fail because they stick to what they know instead of embracing innovation. The discussion also touches on the balance between left-brain analytical thinking and right-brain creativity, suggesting that successful entrepreneurs need both.

15:03

🔄 Understanding Innovation vs. Invention

In the fourth paragraph, the speaker clarifies the difference between innovation and invention. Invention is the creation of something new, while innovation is the application of that invention to meet a need. The speaker argues that not all inventions are innovative, as they may not offer a clear benefit or be commercially viable. The importance of commercializing ideas that people are willing to pay for is emphasized, highlighting the need to balance creativity with practical considerations of cost and market demand.

20:04

🚀 Creativity as a Catalyst for Innovation

The final paragraph ties creativity to innovation, suggesting that creativity can spark new ideas and solutions that may not have been previously considered. It positions creativity as a catalyst for innovation and emphasizes the importance of commercializing these ideas. The speaker sets the stage for future discussions on how to turn these concepts into actionable strategies, focusing on the intersection of creativity, innovation, and commercial success.

Keywords

💡Creativity

Creativity is the use of imagination or original ideas to create something; it is the process of generating ideas. In the video, creativity is discussed as a skill that can be taught and learned, and it is essential for entrepreneurship. The speaker emphasizes that creativity is not just an innate trait but can be developed through tools and techniques. An example from the script is the idea that creativity can be enhanced by incorporating people known for their novel solutions into decision-making processes.

💡Innovation

Innovation refers to the process of translating an invention or idea into a good or service that creates value or for which customers will pay. In the context of the video, innovation is distinguished from invention and is about applying new ideas and methods to create better or more effective products, services, or processes. The video discusses how Borders Books could have innovated by creating a vending machine for digital music downloads in their stores, which would have been a novel application to fit a customer need.

💡Entrepreneurship

Entrepreneurship is the process of designing, launching, and running a new business, which typically starts as a small business, such as a startup company, offering a product, process, or service for sale or hire. The video connects entrepreneurship with creativity and innovation, suggesting that an entrepreneur must be able to think creatively to generate ideas and then innovate by implementing those ideas to create value in the market.

💡Incubation

Incubation in the video refers to the period during which ideas are allowed to mature before they are acted upon. This concept is important because it suggests that rushing to implement the first idea that comes to mind may not yield the best results. Instead, allowing ideas to incubate can lead to more refined and effective solutions, as it provides time for thorough evaluation and potential combination with other ideas.

💡Evaluation

Evaluation, as discussed in the video, is the act of assessing the worth or significance of something, such as an idea or solution. It is a critical step in the creative process because it helps to determine whether an idea is viable and likely to succeed. The script mentions that typically, the first idea generated is not the best and that evaluating multiple ideas can lead to discovering more effective solutions.

💡Commercialization

Commercialization is the process of making something that was previously designed for specific groups or a certain type of user available to everyone. In the video, commercialization is tied to the concept of innovation, emphasizing that an innovation must not only be new but also marketable and valuable to customers. The speaker uses the example of Borders Books to illustrate the importance of considering commercial viability when innovating.

💡Invention

Invention is the creation of something new, such as a product, device, or method. The video differentiates invention from innovation by stating that while invention is about creating something new, innovation is about applying that invention to meet a need or improve a process. An invention may be inventive but not necessarily innovative if it does not offer a practical benefit or if there is no market for it.

💡Market

The market, in the context of the video, refers to the group of potential customers who might be interested in a product or service. Understanding the market is crucial for entrepreneurship and innovation because it helps to identify opportunities and assess the viability of an idea. The script discusses how Borders Books was concerned about the digital music market and the threat posed by free, pirated music.

💡Ideation

Ideation is the process of generating, developing, and communicating new ideas, particularly in a business context. The video emphasizes the importance of ideation in entrepreneurship, suggesting that having a deep understanding of a subject matter can lead to more creative and effective ideas. The speaker also mentions tools and techniques that can help enhance the ideation process.

💡Implementation

Implementation refers to the action of putting a plan, idea, or strategy into effect. In the video, implementation is discussed as a critical step in the innovation process, where the creative idea is put into practice. The speaker highlights the importance of not only generating creative ideas but also having the skills or partnering with others who can help bring those ideas to life.

💡Competitive Advantage

Competitive advantage is the attribute that enables a company to outperform its competitors. In the video, the concept is used to illustrate how companies like Borders Books were seeking innovative ways to maintain their competitive edge in the face of changing market dynamics, such as the rise of digital music and online piracy.

Highlights

Creativity is the process of generating ideas and can be learned and enhanced through tools and techniques.

Knowledge and background in a subject can improve creativity by providing a deeper understanding and potential solutions.

Creativity skills, like entrepreneurial skills, can be taught and learned, with various courses and resources available.

Evaluation is crucial in the creative process; evaluating multiple ideas can lead to better solutions rather than implementing the first idea.

Bringing creative individuals into the decision-making process can add value and lead to novel solutions.

Businesses often fail by sticking to comfortable, existing models instead of innovating, as seen in the case of Borders with digital music.

Creativity, innovation, and entrepreneurship are interconnected and essential for developing new products and services.

An idea that can be commercialized is a key element of innovation, differentiating it from mere invention.

Innovation can be an incremental improvement rather than something completely new, as long as it adds value.

Involving a team with diverse skills, including creativity and analytical thinking, can help in implementing innovative solutions.

Borders faced challenges adapting to the digital music space and failed to innovate, which contributed to its decline.

The balance between creativity and practical implementation is essential for successful entrepreneurship.

Invention is about creating something new, while innovation involves applying these new ideas to fulfill a need or improve existing solutions.

Commercialized ideas, or innovations, should meet a market need and be practical enough to be adopted by consumers.

Understanding the strengths and weaknesses of existing solutions can inspire more effective and efficient innovations.

Transcripts

today we're going to look at three

interconnected topics entrepreneurship

creativity and innovation and within

that we want to start with creativity

and with creativity we want to think

about that as the way one of generating

ideas now as we have ideas we want to

think about where is it going to make

things better it's going to think make

things more comfortable can I create a

product or a service that's going to be

more efficient or more effective and in

that model there are various ways that

creativity can come forward one is

certainly the process of when you think

about creativity you may think well I'm

creative or I'm not or my friend is

creative or they're not but what we find

is that much like building a financial

statement or doing a marketing plan

there are some tools and techniques to

help you be more creative to help you

find creative solutions the other piece

of the puzzle is there may be people

that you can bring into the fold if you

have friends or family that are creative

if you have founders or other

individuals that are creative and that

are just known for coming up with the

crazy ideas and having novel solutions

to things incorporating them into your

decision making even if it's just to

bounce ideas off of it's very valuable

as well so when we think about

creativity we're going to look at it

both in the process as well as from the

people standpoint so again some people

think they're creative or think they're

not creative and they may be right but

just as entre Nouriel skills can be

taught and learned creativity skills can

be taught and learned and you'll see at

a number of universities there are an

increasing number of courses in

creativity and there are a lot of books

and articles and resources that are out

there to help you be more creative and

what it is that you're doing and we'll

talk about a few of those one thing that

certainly helps is some background in

the topic matter why does that make

sense

why does it make sense that you're going

to have more creative solutions if you

know something about the topic okay you

can think further in depth about the

topic because you have a deeper

understanding or you have a background

in it you know the straight

okay you have a sense of some of the

strengths and weaknesses maybe things

that have been tried in the past that

either worked or didn't work so you're

just better versed on what some of the

candidate ideas could be or should be

and so in that way again one way of

improving your creativity is having more

in-depth knowledge and experience in the

subject matter there's also this element

of incubation and ideas and I think a

big piece that's often missed is

evaluation if we're faced with some

problem we tend to want to come up with

a solution and implement what's the

problem with that there's an idea we

implement what pieces are missing is it

a good idea

we typically implement the first idea we

typically try and solve something would

the first thing that we think of and

oftentimes that's wrong and or sub

optimum and that if you evaluated that

and or if you generated several ideas it

might be that second third or fourth

idea that turns out to be the better of

the lot or there might be some

combination and or if you're doing

things as a group there's enough

solution you came to bear based on input

of the group rather than just of the

individual so in that way again the

creativity element and the creative

process is something that with knowledge

and background is certainly helpful but

I would say more help would engage some

other people in the solution more

helpful to evaluate that and recognize

well what is the problem that we're

trying to solve and how are we going to

evaluate its success so recognizing

relationships is a piece of that and

what we mean there is that you're

looking at things that are different or

somewhat unorthodox there's a company in

the u.s. called borders borders books

and music

heard of it went out of business there

were a Barnes & Noble competitor Borders

Books of music was based in Ann Arbor

Michigan and in 2003 I worked on a

consulting engagement with them to help

them figure out what they should do if

anything about digital music and 2003

was a time where you typically went to

the bookstore went to the record store

bought your CD or you went to Amazon and

you bought your CD you did not typically

buy a track why did you not buy a song

use accompanies did not release

individual songs with much frequency now

maybe there was one song from an album

that you could pay three or four dollars

for that song versus paying twelve or

fifteen dollars for the entire CD but

again singles were rare and infrequent

and getting them on your mp3 player was

even more of a challenge now you could

buy the CD you could plug your mp3

player into your computer and you could

get the songs from the CD that you

purchased to your mp3 player but there

wasn't such a thing called iTunes there

wasn't such a thing called iPod or

iPhone and there was no really access to

be able to get music on a per song basis

in 2003

why did borders care

why did borders care about the future of

music and in the future of digital music

with okay so there is Barnes and Noble

that kind of do what we do and we want

to know what they're doing and be

competitive what else were they

concerned about

if someone else is doing the same thing

trying to figure out how to make it okay

they expected that someone was going to

come along and do some novel things in

the digital music space that someone is

going to sell a CD that you can download

directly to your mp3 player and someone

might even be able to convince the music

companies to sell on a per song basis

for $0.99 as opposed to a per album

basis for twelve dollars what else drove

them to be concerned about that

marketplace you could find your song

online where were you finding your song

Napster so I had a free pirated

repository of any song that I wanted so

they too were trying to find a way how

do we compete with free how do we

compete with pirated but again a bricks

and mortar store so what did they also

want they wanted did you say a digital

store okay so they were some online

element but what do you if you're paying

rent on a bricks-and-mortar facility

what do you want you want people to come

into the store you want them to buy the

coffee you want them to buy the beignets

or whatever else it is that you can get

at your Starbucks inside of your Barnes

& Noble's again borders also had their

cafe and again high profit center and we

typically know if we can get somebody in

a store they walk out with more than

they would have if they were just going

online to buy that one thing so in that

way - they saw a lot of value of how do

we compete with Napster how do we

anticipate what's going on in the music

space how do we get people in our bricks

and mortar retail space and how do we do

it not exactly knowing how the markets

going to shape in the merge

so again took some creative thinking to

come up with an idea for them and the

idea that we came up with was

essentially a vending machine in the

store we're about you could plug in your

phone or your mp3 player choose songs

and download them onto your device so

how is that better than the alternative

tell me more okay so it's something you

can do in the store while you're there

what else is good for the customer would

that vending machine model buy the song

versus the existing way and again put

yourself and ten years ago of I buy a CD

okay if there are technical issues then

there's somebody on site right then and

there that can be helpful you don't have

to buy twelve songs for twelve dollars

you buy the one song you want for a

dollar instead of I buy the CD put it

into my machine I put it on my hard

drive I plug in my device and then I

move it over I can just plug my device

right in in the vending machine I can

dial up what I want and it's done

borders didn't go for that now it's easy

in retrospect to say oh look how dumb

they were what were their issues there's

some element of again attachments and

cables and adaptability but again that

wasn't a major sticking point for them

for not adopting it there's the element

of is there enough of the companion

Hardware out there and what's that going

to take but again there were

some norms of how to do it and people

were again adapt it I can plug it into

my computer and it works so there was an

emerging market I'm just going to kind

of sweep this way yep okay there's an

expense but for them it was essentially

the cost of a PC in a box and a web

connection so versus what their

operating costs were as a company fairly

cheap yep there's a fear of again is it

going to be worth it is it going to be

profitable yep well they would not have

to buy they would have to again have an

agreement with the labels with the music

distributors so that we're gonna sell on

a per song basis instead of selling on

an album basis what was the sticking

point that made them not want to do this

it's her element the first of all

they've been selling CDs and as the math

gonna work out we're enough consumers

are going to buy enough songs that I'm

not gonna lose money of consumers that

would have otherwise given no other

options bought the CDs does that make

sense so you have a group of consumers

maybe there's a quarter of you that buy

CDs and you own may only want one or two

songs but you'll buy the whole CD for

that one or two song and that's a known

factor then I've been doing this for

years and I know what that number is and

I know what my revenues and profits are

based on that now there's a bigger group

of you that don't buy CDs because you

don't want the whole thing but you might

buy a song if it's more convenient than

Napster if the record label makes that

song available you might buy it and

that's a big unknown

but again for them that unknown was not

worth the difference of let's stick with

what we know and in retrospect in

2004-2005 largely iTunes made their

existing model somewhat defunct and in

that way yeah

slowly but surely they've kind of

fizzled out

now Barnes and Noble has done some other

things but again when you think about

these relationships a lot of big

companies fail because they see the

obvious and they're comfortable and what

they've been doing and that's where the

advantage often is wrongdoers and that

you're not stuck in what you've been

doing you're not committed to expenses

that you've already incurred and we'll

talk about some other companies have

been caught with that as well another

thing to think about is there's this

element of left-brain right-brain that

you might be familiar with of elements

of a my analytical a my more creative

yeah it's worth recognizing and worth

understanding what the terms are

you know fundamentally I would argue

good entrepreneurs have a balance of

both of these of that they can think

creatively they can come up with novel

ideas but what they also do is come up

with some ways of implementing that and

or teaming with other people that are

going to be helpful in implementing that

so they're able to again as a team bring

this element of creativity and

implementation to bear and so you have

these three elements you have the

creativity you have innovation they also

have invention what's the difference

between innovation and invention

what's the okay so invent is I created

something new and that innovation is

applying the invention okay to fit a

need okay what do you think

say make it even better well what's the

difference of innovation and invention

what's the difference in the two okay so

invention is that creation of a new

product I'll buy that and then

innovation is improving something that

already exists so an innovation cannot

be invented and that's where a lot of

people kind of fall into this gap but we

get what invention is we kind of know

what invention but the innovation does

it have to be something new should it be

something new doesn't have to be new

might help right so it's somewhat

difficult again I would say that there

certainly is an overlap area if you have

things that might be inventive I could

have a three handled plunger from my

toilet never seen one before

it's inventive Wow could I argue that it

might not be innovative okay the

usability of it the purpose of it the

benefit is questionable can i

commercialize that can I sell it

probably not not a mini volume so again

just because you invent something

doesn't necessarily mean there's a

market for it

doesn't necessarily mean you can build a

venture or build a business off of it so

again as we think about innovation and

we'll connect these terms in a moment as

we think about innovation there are lots

of definitions that are out there these

elements of introducing something new

new ideas and methods exploiting so

that's beginning to go down the path of

applying or implementing

there's some element of performance and

that in some measure it's not only

different than again and that typically

means different performance typically

means better so innovations have some

element of better or have some element

of applied that will differentiate an

innovation from an invention and so for

us at least for our purposes in the

course you can think about

commercialized ideas that's a good

definition for innovation

it's an idea it might be a new idea it

might be an old idea it might be a

reframed or kind of rethought I do but

that you can in some way bring that to

market you can commercialize that you

can add some value and people will

recognize adat purchase the product of

that idea there's also an adage

particularly in working with highly

technical teams of they want to produce

gold-plated catalogs

a gold-plated Mercedes and often it

traces back to wanting to develop better

they want the top materials they want

the top performance what's the problem

with that the price people might like it

but not enough people may like it enough

to pay what it is you need them to pay

for it to be a profitable venture so

there's a question of how do we design

something that people want but also keep

in mind there's a cost and a price

associated with it and being careful

that you're designing appropriately for

what people are going to be willing to

pay for that in summary it's important

to recognize

said creativity ignites innovation and

that way if you're creative if you're

thinking broadly you can develop some

imaginative solutions you can maybe

connect ideas across different

industries you can also discover

opportunities impossible solutions that

may not have been thought of before and

that way again being innovative doing

something new doing something novel that

has value inventions are certainly a

piece of the innovation puzzle but you

may have concepts that are inventive

that there may not necessarily be a

market for alternatively you might have

something that's an incremental

innovation where you're not inventing

something brand new but you are

developing some new ideas and bringing

some new things to market or connecting

existing ideas in that way we think

about creativity as ignition for

innovation but fundamentally we want to

think about also the commercialization

of these ideas and so this sets the

landscape for that and we'll be talking

going forward about how to put some of

these ideas into action