eNEWSLINE - Business Education News from AACSB International

Dean's Corner: Innovation is Here to Stay (and Not in a Shy Way)

August 2013

By Alfonso Gómez, PhD
Former dean, Adolfo Ibáñez Business School, president, Innovation Center UC
Pontificia Universidad Católica de Chile

Do you remember the term 'reengineering?' A few years ago, it was almost impossible to attend a business conference without bumping into that word as the central theme of a program. A decade later you still come across it, but its usage is confined to the realm of operations management—only common among those interested in improving process efficiency. The reengineering fashion is over. Will the word 'innovation' suffer the same fate?

For business schools, innovation presents a dual challenge: As part of the higher education system, institutions live under increasing competition, mostly due to a sort of 'commoditization' of their academic offering and a shared concern for the net value of MBAs and other similar graduate business programs. In one sense, schools of business face the need to renovate their value proposition; from this perspective, business schools are increasingly becoming the subject of innovation.

From another angle, business schools are responsible for educating new generations of leaders that will face the challenge of starting up—and developing—companies with unprecedented demands for environmental sustainability and social constraints, which is a radically different scenario from the one their predecessors faced. In a Heraclitean world, in which the only certainty is change, business schools need to take responsibility for graduating professionals with the competencies to master the art and science of innovation. From this perspective, business schools are catalysts of innovation.

Humanity has been innovating since its very origins, to the point that what we call civilization, and can be seen as a long chain of innovations. How is it that the term 'innovation' has become so predominant and omnipresent? Steward Kauffman suggests that the explanation for this phenomenon can be found in the burst of new knowledge, and in the exponential number of combinations that emerge from crisscrossing this new knowledge from different disciplines. As an example, he presents the Wright brothers' airplane not as a disruptive new invention, but rather a radical innovation resulting from a series of well-known artifacts such as the combustion engine, the helix, and the bicycle wheel—all of which were invented long before the first flying machine came into existence.

In times of financial crisis, deep uncertainty and widespread social unrest, there is not a single voice claiming that the advancement of knowledge is moderating the explosive growth it has undergone over the last fifty years. If anything, the consensus is that this process will accelerate. In this scenario, obsolescence will accelerate as a result of the myriads of new products and services emerging from unprecedented combinations of new components and materials. It is easy to imagine new value propositions emerging from discoveries stemming from biotechnology, combined with faster and cheaper microchips and new materials emerging from research in nanotechnology.

But the advancement of knowledge is not the only grounds upon which innovation can be justified. Human intervention on our planet has resulted in serious threats to global equilibriums that are key for the very conservation of civilization. The only way out of this menacing scenario comes in the form of new technologies and proactive human intervention designed to restore environmental balance. In addition, there is an entirely new set of social circumstances resulting from the emergence of an unprecedented capacity of people to coordinate themselves through virtual networks.

The combination of these circumstances establishes solid grounds on which to claim that the generalized urge for innovation is not just a passing fashion, and that innovation is more than just a buzzword that will fade away. If we take that conclusion seriously—and so we should—business schools must be prepared to undertake some decisive courses of action: innovation must be a core discipline, occupying a place as prominent as finance, marketing, or strategy. In addition, as is the case with ethics, innovation should not only be regarded as an ascending vertical discipline, but also as a transversal concern that impacts all business-related disciplines.

If we accept the claim that innovation is fundamental to the extent that it is here to stay, and that there is an urgent need to teach, research, and practice innovation in business schools, the question that emerges almost automatically is: How should innovation be implemented in this context? The guiding manifesto for adopting and implementing innovation should be tailor-made by each institution, but in my experience the following considerations also are worth considering:

• Innovation is about creating a value proposition and maintaining its validity. As value is something that only exists in people's minds, innovation should be unavoidably and centrally human centered.

• Human needs are both implicit and explicit. A key element for enhancing innovation competences stems from developing the ability to see where others do not see (observation) and to listen beyond people's requests and declarations.

• Incorporating innovation in a business school culture requires more than simply revising curricular contents. Appropriate teaching methods, a leadership capable of inspiring the necessary mood for innovation, and a genuine concern for ethics, also are of utmost importance.

• Science and technology are (and will continue to be) key sources of innovation opportunities, but the realm of innovation should extend beyond that to encompass design and business models. The latter is quite appropriately a source of innovation that business schools should embrace with special determination.

• Innovation (and business management) is not a task solely for the left side of our brains. Innovation is not an irrational act, but neither is it just an analytical challenge. Conditions should be created to allow the right part of our brain—the one associated with creativity, synthesis, and non-linear thinking—to express itself, therefore integrating both sides of our humanity.

• The best way to innovate successfully is by being clear as to what we want to conserve. Innovation is not simply about throwing everything out and replacing it all with something totally new.

In an era so decisively determined by accelerated change, a business school that does not embrace innovation as part of its core business, is bound to be left behind by the high-speed train of history.

Alfonso Gómez, PhD
Former dean, Adolfo Ibáñez Business School, president, Innovation Center UC,
Pontificia Universidad Católica de Chile