ABSTRACT
This chapter looks at the theme of innovation: why it matters, what it involves and how it can be organized and managed effectively. It explores the main themes around innovation and why it is a survival and growth imperative. The chapter presents innovation as a core process in the business, concerned with renewing what the organization offers and the ways in which it does so. It helps to understand the strategic importance of innovation. The chapter identifies the core process of innovation as one of creating value from ideas. It also Identifies how innovation plays out in different contexts. The chapter analyses where and how operations management plays a central role in this process. Some examples of 'paradigm' innovation–changes in mental models–include the provision of online insurance and other financial services, and the repositioning of drinks like coffee and fruit juice as premium 'designer' products.
