Innovation has been a hot topic in recent years and many companies and organisations mention it in their vision and mission statements regardless of understanding the basics of it. Innovation is in the To-do list of several companies and even government agencies.

Everyone wants to be innovative and there are many recommending innovation to keep the competitive advantage in the market. Majority of managers acknowledge innovation as an important part to their company’s future, but contemplating all above, not many leaders, managers or business owners know the principals of innovation. They simply don’t know where to start, what kind of problems they can solve with innovation, how to foster, encourage and manage I and many other questions.

The 21st century economy is very different with last century’s one. We have moved from an industrial economy to a digital, democratised economy. All the rules for old economy aren’t working for the new one. But unfortunately our managers and management schools are mainly based on old economy principals.

In old school managerial systems, a manager is expected to know all the answers and they normally get to that role, because it is perceived that they know all the answers based on last experiences and what they learned in business schools.

Not surprisingly, this system doesn’t work anymore in many cases. In our modern world, we are facing different problems. These are complex problems, whereas managers are trained to deal with complicated problems, many of the organisations problems are complex that can’t be easily addressed and solved by prior knowledge or experience.

Theodore Kinni explains them in a very clear way: (Read more)

Here's the difference between complicated and complex problems:

A complicated issue, explains Nason, is one in which "the components can be separated and dealt with in a systematic and logical way that relies on a set of static rules or algorithms." It may be hard to see, but there's a fixed order in something that is merely complicated and that allows you to deal with it in a repeatable manner.

Pumping crude oil from 6 miles below the surface of the Gulf of Mexico is complicated. So is making an electric car and a reusable rocket (just ask Elon Musk). But once you figure out how to do these things, you can keep doing them at will.

On the other hand, a complex issue is one in which you can't get a firm handle on the parts and there are no rules, algorithms, or natural laws. "Things that are complex have no such degree of order, control, or predictability," says Nason. A complex thing is much more challenging--and different--than the sum of its parts, because its parts interact in unpredictable ways.

Managing people is a complex challenge. So is integrating the two merging companies or figuring out how the market will react to a new product or strategy. Maybe you'll get lucky and figure it out once, but whatever you did this time won't generate the same result next time.

What’s the issue with it now?

Managers based on their experiences and knowledge try to solve all problems as they are complicated, however, many of our today's world problems are complex and managers simply don’t have a magical solution for them as they are expected to have.

This is where managers must employ innovation to resolve complex problems and understand they are not expected to be “know-it-all” as they were expected to be in the past. Managers should cultivate, foster and conduct innovation engaging all team members which requires understanding, promoting and supporting innovation intelligence.

What is Innovation Intelligence? In the next article, it’ll be discussed and elaborated more.