Innovation and Entrepreneurship are two different terms having entirely different meanings. However, there is a relationship between innovation and entrepreneurship, which sometimes makes the confusion. The key difference between innovation and entrepreneurship is that the innovation means introducing something new. This can be an idea, product, model, or a service. On the other hand, making a great idea into a business opportunity is entrepreneurship. Entrepreneurship begins with innovation. There is a risk involved in entrepreneurship which is not there in innovation. Let us look in detail at both the terms in order to elucidate the difference between them.
What is Innovation?
Innovation means introducing something new. This can be an idea, product, model, process, or a service. For example, introducing a new equipment that can reduce the electricity consumption by some percentage is an innovation. Innovations need creativity and new thinking. Innovation always does not mean invention. Innovation can create change and add values to the existing product or a service.
The sources of innovation are economic changes, technological changes, new knowledge, new markets, etc. These things make a person think of a new product, services or business process. Innovation help organizations to be strong and be competitive in the industry. There is no risk involved in innovation.
What is Entrepreneurship?
Entrepreneurship is making great ideas into a business opportunity by taking a risk. Entrepreneurship understands the business opportunity for the great ideas innovated and adds a tangible value to the innovation. Entrepreneurs always search for innovation sources and they do not restrict themselves for one type of innovation. Entrepreneurs set up business on the opportunity identified and run it profitably. They need skills like planning, decision making, managing, leading, motivating and risk taking. Successful entrepreneurship is always a result of hardworking, commitment, and risk taking.
What is the difference between Innovation and Entrepreneurship?
Although there is a link between innovation and entrepreneurship, they have a different meaning altogether. Following are the major differences between the two concepts.
Definitions of Innovation and Entrepreneurship:
Innovation: Innovation is creating something new; it always doesn’t create a business opportunity.
Entrepreneurship: Entrepreneurship identifies the opportunities in great innovations and creates opportunity, add values and keep the value improving over a period of time.
Characteristics of Innovation and Entrepreneurship:
Innovation: Innovation can have a short durability.
Entrepreneurship: Entrepreneurship has a long durability which adds and improves the value of the opportunity created.
Innovation: In innovation, there is no major risk involved.
Entrepreneurship: In converting an idea into a business opportunity, risk-taking cannot be avoided. Risk taking is a key factor in entrepreneurship.
Innovation: Innovators lose interest after idea stage.
Entrepreneurship: Entrepreneurs fail, rethink and work hard to make the venture more successful.
Innovation: Innovators have a passion for inquiry, experiment with creative thinking.
Entrepreneurship: Entrepreneurs need skills like planning, leading, managing, and decision making. Entrepreneurs take risks, work hard and are committed to achieving success in their business.
Innovation: Innovation is the outcome of a new thinking.
Entrepreneurship: Entrepreneurship is the process of making the innovation to a business opportunity.