Cima E2 Exam Question No 39

Question No 39:

What is Innovation?

Innovation means to do something differently from the way it was done in the past. In business this can often be linked to:

• New products or services 
• New procedures 
• Use of new technology
• Using new methodologies 

Innovation is particularly important to companies who tend to be on the leading edge of their field of expertise as that innovation can lead to a competitive advantages. Note though that innovation is not just about better products, quality or service, a new process could help to create efficiencies or cut costs, so cost leaders also need to be innovative to succeed. Innovation differs from invention in that innovation refers to the use of a better and, as a result, novel idea or method, whereas invention refers more directly to the creation of the idea or method itself. Innovation differs from improvement in that innovation refers to the notion of doing something different rather than doing the same thing better.