Some of the most misunderstood aspects of business are creativity, design, and innovation. Part of the confusion stems from the many definitions and theories that exist for each term. Taken as a whole, these definitions of these terms tend to overlap creating an even more subjective understanding and adding to the confusion.


Creativity can essentially be defined as coming up with an idea. In and of itself, creativity is not that useful to companies. The creative process can be thought of as the starting point for a company to innovate and ultimately design a product (von Stamm, 2003). Many experts suggest that unlike development and implementation, creativity can not be produced by a team; it is a wholly individual process.

Creativity is related to experience not divine intervention which is what many laypeople believe. An example of that would be musical improvisation; it can be taught and the more experience a student has with music the easier the student can put together musical fragments subconsciously to make a coherent improvisation. Without this experience, the student would make noise. There is little doubt that certain individuals are more creative than others, but everyone can learn techniques to stimulate the creative process as long as sufficient motivation and encouragement exists.


Innovation means different things to different people. Most modern definitions include differing levels of innovation. These include things like process improvements; new products, both to the company and the world; new markets for existing technologies, and disruptive or revolutionary technologies. Companies need to make certain that existing knowledge or expertise does not prevent innovation and innovation is truly about a frame of mind (von Stamm, 2003). Innovative companies combine all three aspects of improvement, creativity, innovation, and design. These innovative companies have a strategic vision allowing them to culturally encourage these processes.


Perhaps the most elusive process to define is design. Design has been broken down into engineering, or production design, and artistic design, although many other definitions exist. Basically design, as it is relevant to creativity and innovation, is figuring out how to make something better and requires a balance of both engineering and art. The result of design does not necessarily refer a product, but could be a business process or service. Design is often confused with creativity, but they are two sides of the same coin. Von Stamm (2003), suggests that “design is the conscious decision-making process by which information (an idea) is transformed into an outcome, be it tangible (product) or intangible (service)” (p. 12). The key difference between design and creativity is conscious versus unconscious processes. Design is creative, but it is not creativity. Design refers to some type of tangible outcome whereas creativity concerns itself with creating an idea. Designers are oftentimes the creators and many of the skill sets are shared, but they do not have to be the same person. As stated above, creativity is a singular, unconscious task; design, as a conscious process, often lends itself to group settings and is generally more accepted as a business process with many organizations having design teams either formally or informally.


Strategically an organization must balance innovation, design, and creativity in order to stay competitive. Innovation, design, and creativity all overlap to some degree and organizations must nurture and encourage all three. Creative staff needs freedom to experiment and synthesize, but also need constraints and objectives. Managers must understand that analyzing and quantify all aspects of a creative team or employee is not always possible since many of the outcomes are often based on intuition, not measurable results (von Stamm, 2003). Without the creative process, and ultimately its implementation and design, companies are in reality copying other ideas and never innovating new products. This leads to a company that is more tactical than strategic and an over reliance by management to react to the market instead of leading the market.


Von Stamm, B. (2003). What are innovation, creativity and design?. In Managing innovation, design and creativity (pp. 1-18). West Sussex, England: John Wiley & Sons Ltd.

More Creativity and Innovation Articles

Creative Intelligence

Creative Intelligence

Creative intelligence is simply how an individual perceives the world around them (Rowe, 2004). Rowe (2004) continues to point out that any act which is new and has a useful outcome can be considered as using creative intelligence . This opens the...