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Updated Jan 30, 2024

Creativity Is Not Innovation (But You Need Both)

Creativity and innovation are two related but separate notions, and each is required for workplace success. Here's the difference and how you can inspire both.

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Sean Peek, Business Ownership Insider and Senior Analyst
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This guide was reviewed by a Business News Daily editor to ensure it provides comprehensive and accurate information to aid your buying decision.

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“Creativity” and “innovation” are two words that are constantly thrown around in brainstorming sessions, corporate meetings and company mission statements. There’s no question that these values are highly prized in the fast-paced modern workplace, but do leaders who use the terms truly know the difference between them?

What is creativity?

Creativity is the ability to think in new ways and apply fresh perspectives to old problems. Shawn Hunter, author of Out Think: How Innovative Leaders Drive Exceptional Outcomes (Wiley, 2013), defines creativity as “the capability or act of conceiving something original or unusual.” It is a critical skill in business that enables people to adapt and create unique approaches that may be even better suited than tried-and-true methods. 

Types of creativity

Arne Dietrich, associate professor of psychology and chair of the Department of Social and Behavioral Sciences at the American University of Beirut, Lebanon, conducted research into creativity that segments it into four types: deliberate and emotional, deliberate and cognitive, spontaneous and emotional, and spontaneous and cognitive.

People can experience each of the four types of creativity. Especially for knowledge workers like researchers, lawyers and doctors, deliberate and cognitive creativity may manifest while on the job. Spontaneous and emotional creativity may show itself during an artistic pursuit or during down time off the clock.

Deliberate and cognitive creativities use focused attention and formed connections between information stored in the brain and rely on the prefrontal cortex, while emotional and spontaneous creativities stem from the amygdala and tend to be more instinctive. People who are good at taking insights derived from each type of creativity excel at thinking outside the box and applying new approaches to their work.

Key TakeawayKey takeaway
Creativity is the spontaneous development of new ideas and out-of-the-box thinking. Creativity is a necessary prerequisite for innovation, but they are not the same thing.

What is innovation?

Innovation is applied creativity, in which the spark of a new idea is turned into a novel solution or process. Hunter weighs in with his own definition: “Innovation is the implementation or creation of something new that has realized value to others.” 

Innovation is realized most vividly in the form of a tool, physical benefit or aid that solves a problem or creates an advantage. These tools are not limited to humans – for example, birds and monkeys use sticks to pull food out of tight locations. So, innovation is far more possible for different species under different conditions and environments.

Types of innovation

Doblin, a global innovation firm that helps leading organizations find human-centered solutions to business problems, created the Ten Types of Innovation framework as a way to identify transformational opportunities, specifically in business. Based on research of over 2,000 successful innovations, Doblin outlined three broad categories: business model, product and marketing.

  • Business model: Internally focused, these configuration innovations analyze how an organization operates and creates revenue. These can be higher-risk, as they sometimes change fundamental decisions on which businesses are built. Business model innovations are best pursued when owners and operators identify oversaturated markets, low customer satisfaction and outdated technology.
  • Product: Nearly always tangible, product innovations make existing material goods better in some way or result in the creation of an entirely new product. It’s the most common form of innovation; famous examples include smartphones, fidget spinners, wireless headphones and foot-massaging insoles.
  • Marketing: Marketing innovation creates new markets or increases existing market share. Marketing innovations are new, positively-disruptive ways for brands to talk to and engage with their consumers. Not only can marketing innovation introduce a new way of connecting with the public, but it can be as simple as promoting an existing product for a different use than what was first intended.
An innovation makes a demonstrable, often disruptive difference in a product, service or industry. It is a fundamentally new, tangible shift and departure from the conventional.

Why are innovation and creativity important?

Creativity and innovation are important in business because each contributes to a dynamic evolution that prevents companies from stagnating and enables them to stay competitive in an ever-changing marketplace. While they are not the same, creativity can lead to innovation, so understanding each as two sides of the same coin is critical for business leaders.

Creativity precedes innovation

Creativity is the novel step of being the first to identify that something might be possible. Business leaders frequently interchange creativity and innovation without understanding what separates the two.

“Creativity isn’t necessarily innovation,” Hunter said. “If you have a brainstorming meeting and dream up dozens of new ideas, then you have displayed creativity, but there is no innovation until something gets implemented.”

Hunter noted that many leaders emphasize generating creativity on demand instead of building the conditions that enable ongoing creative thinking, which can ultimately lead to innovative developments. 

To boost creativity in your organization, consider giving employees flexibility within their workday to try out new things or explore different avenues of thinking. Create a company culture where thinking outside the box is encouraged and rewarded in order to spur your most creative thinkers to do their best work.

Innovation is applied creativity

Innovation is the action of putting things into practical reality, despite challenges and resistance, rather than just contemplating. It takes creative thinking, planning and implementation of new ideas to constitute innovation.

“Innovation isn’t a mysterious black box,” he said. “It can be simple small tweaks to existing processes, products or interactions. And by focusing on the process [of innovation], and not the heroically creative individual, we can build innovation at scale.”

A good example of innovation profiled on CNBC by Karen Gilchrist was Sergey Petrossov. He saw a need for a software tool to connect luxury jets that aren’t being used with travelers willing to share trips with each other. All the pieces of that market existed, but it was Petrossov who built the bridge between the two via software to create a whole new company, JetSmarter.

In other words, an innovative process is replicable and scalable; a creative individual is not. Petrossov was one of a kind in realizing what was needed to create a new market, but his software code was easily repeatable by other programmers once written. Once leaders learn the difference between creativity and innovation, they can work on inspiring both among their team members – and building a culture that supports these values.

How do you develop creativity and innovation?

Developing creativity and innovation in your organization means granting employees permission to try new approaches within the context of their current roles. This starts with company leadership and buy-in for attempting new things.

“While leaders can foster innovation, the organization as a whole must also support innovation through the makeup of its culture and the way it designs its processes,” Hunter said. “Sometimes the best way to spark innovation is by allowing activity within the organization that deviates from the norm but that may lead to positive outcomes.”

Part of the issue is getting people to imagine and develop new visions of what could be. Creativity is often associated with art and culture, but it’s not required to be Leonardo da Vinci. What matters is that a person is willing to imagine new possibilities outside of norms. This is where the idea that can be acted on starts. Consider crowdsourcing ideas to generate even more possibilities to consider. 

The harder part, of course, is taking that great idea and translating it into a physical or technical prototype. When creative ideas that could lead to innovation surface, it’s up to company leadership to dedicate enough resources to support the development of the new process or product. Without investment, creative ideas remain just that; but when enough support is provided by the company, it can become a hugely successful innovation.

The Starbucks Frappuccino as a successful innovation

As an example of the importance of investment before innovation, Hunter cited the birth of Starbucks’ now-popular Frappuccino drink. The Frappuccino was the culmination of a license for creative thinking and investment from company leadership, following a false start in which that investment was absent.

In the early 1990s, the staff at a Santa Monica-based Starbucks invented a new drink and asked an executive to propose the product to headquarters, where it was ultimately rejected. The creative idea died on the vine because company leadership refused to invest resources.

Later, though, the same store invented the Frappuccino, and this time company leadership was on board. The same executive asked the staff to begin making and selling the drink to local customers as a proof of concept. It quickly became a hit, and the management group implemented the successful idea companywide once its value was proven.

“The Frappuccino turned out to be one of Starbucks’ most popular and profitable drinks,” Hunter said. “And, according to [Starbucks’ then-vice president of sales and operations] Howard Behar, it happened because someone was allowed, and even encouraged, to experiment with a new product that deviated from the company’s core product line.”

Creativity and innovation are key in entrepreneurship

Together, creativity and innovation involve rocking the boat. Entrepreneurship depends every day on creation and innovation to create unique opportunities, market disruption and new revenue streams. While tried-and-true processes and products exist for a reason, it is important to periodically shake things up and try new approaches. After all, who knows what the next groundbreaking innovation may be?

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Sean Peek, Business Ownership Insider and Senior Analyst
Sean Peek is the co-founder of a self-funded small business that employs more than a dozen team members. His years of hands-on entrepreneurial experience in bootstrapping, operations management, process automation and leadership have strengthened his knowledge of the B2B world and the most pressing issues facing business owners today. Peek uses his expertise to guide fellow small business owners and aspiring entrepreneurs in the areas of marketing, finance and software technology. Peek excels at developing customer bases and fostering long-term client relationships, using lean principles to drive efficiency and cost-saving, and identifying growth areas. He has demonstrated his business savvy through collaborations with Forbes, Inc., Entrepreneur and the U.S. Chamber of Commerce.
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