ABSTRACT
This chapter presents the innovation as a strategy and the competitive advantage. The link between entrepreneurship and innovation emerges from the influential writings of Drucker. Drucker argues that entrepreneurs innovate and that innovation is the specific function of entrepreneurship. The activity endows existing or new resources with the potential for creating new wealth: innovation creates new wealth. Druckers analysis is used in the chapter as the foundation in understanding innovation and entrepreneurship in the real business world, with examples of where to search for innovative opportunities and how to establish a strategy for innovation. Zaltman et al. identify three structural variables, namely centralization, formalization and complexity that have divergent effects at the instigation and operation of the innovation process. Kimberly and Evanisko concluded in line with Schumpeter's theory that organizational size does appear to have a positive influence on the speed of adoption of innovations.
