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7 Sources of Innovation

Peter Drucker identified seven sources of innovation that can be used to generate innovative ideas within an organization: (1) the unexpected, (2) incongruities, (3) process needs, (4) industry/market structures, (5) demographics, (6) changes in perception, and (7) new knowledge. These sources provide a framework for identifying opportunities for innovation but also come with different levels of risk. The first four sources involve recognizing opportunities that already exist or can be easily implemented, while the last three involve greater risks but also greater rewards. Drawing from these seven sources can help foster creativity and allow businesses to adapt to changing environments.

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Bhumitra Dey
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734 views2 pages

7 Sources of Innovation

Peter Drucker identified seven sources of innovation that can be used to generate innovative ideas within an organization: (1) the unexpected, (2) incongruities, (3) process needs, (4) industry/market structures, (5) demographics, (6) changes in perception, and (7) new knowledge. These sources provide a framework for identifying opportunities for innovation but also come with different levels of risk. The first four sources involve recognizing opportunities that already exist or can be easily implemented, while the last three involve greater risks but also greater rewards. Drawing from these seven sources can help foster creativity and allow businesses to adapt to changing environments.

Uploaded by

Bhumitra Dey
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PDF, TXT or read online on Scribd
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Peter Drucker’s seven sources of innovation provide a framework for identifying

and generating innovative ideas within an organization. It provides us with a


purposeful way to search for opportunities as well as mitigate risk. The first four
sources of innovation are symptoms of something that has already occurred, or can
easily be implemented with little effort. They offer evidence that make them
reliable indicators that there is a great opportunity to innovate. The last three
sources of innovation is not so clear and cut as first four. Therefore, they pose a
greater risk of failure, however, promises greater rewards. These sources, outlined
in his book “Innovation and Entrepreneurship,” offer a comprehensive approach to
fostering creativity and staying ahead in a rapidly changing business landscape.
1. The Unexpected: Drucker suggests that unexpected occurrences or failures can
be a rich source of innovation. For example, the invention of Post-it notes at 3M
resulted from an unexpected failure in developing a super-strong adhesive. The
company turned this unforeseen outcome into a successful product by
recognizing its potential for temporary adhesion.
2. Incongruities: Innovation often arises when there is a gap or incongruity between
reality and what should be. One example is the rise of electric cars. The
incongruity between the environmental impact of traditional vehicles and the
need for sustainable transportation led to the innovation of electric vehicles.
3. Process Needs: Identifying and addressing inefficiencies or gaps in existing
processes can lead to innovative solutions. The implementation of lean
manufacturing principles in industries is a classic example. By addressing process
needs and reducing waste, companies can achieve cost savings and improve
overall efficiency.
4. Industry and Market Structures: Changes in industry or market structures can
create opportunities for innovation. The rise of online streaming services
disrupting traditional television and movie distribution models exemplifies how
shifts in industry structures can lead to innovative business models.
5. Demographics: Innovations can be driven by changes in demographics, such as
shifts in population age or income levels. The increasing aging population in
many countries has spurred innovations in healthcare and senior care services,
addressing the specific needs of an older demographic.
6. Changes in Perception: Innovations can result from changing societal attitudes
and perceptions. The acceptance and integration of alternative medicine
practices into mainstream healthcare reflect a change in perception towards
holistic approaches to well-being.
7. New Knowledge: Advances in technology and scientific knowledge often drive
innovation. The development of smartphones and the subsequent app
ecosystem is a prime example of how new knowledge in communication
technology has transformed the way people live and work.
In summary, Peter Drucker’s seven sources of innovation provide a holistic
perspective on the various avenues organizations can explore to foster creativity
and adapt to a dynamic environment. By recognizing unexpected events,
addressing incongruities, improving processes, adapting to changing industry
structures, responding to demographic shifts, embracing evolving perceptions, and
leveraging new knowledge, businesses can position themselves for sustained
innovation and success.

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