There's nothing new about creativity - without it we would still be living in caves. But organisations are trying harder than ever to channel creative ideas to give them a competitive edge. Creativity is defined as finding something that did not exist before, and innovation is finding a new, practical application for it. "The inventor of the transistor was creative; but the person who saw its potential and invented the Sony Walkman was innovative, " says Professor Malcolm Higgs of Henley Management College.
The story so far
The study of innovation began as part of economic theory, examining why one kind of business failed and another one started. Originally, academics in the 1950s saw creativity as a component of intelligence.
The issue climbed up corporate agendas in the 1960s as America developed a neurosis about falling behind the Soviet Union in the space race.
New educational theories were tested in schools, and institutions like the Stanford Research Institute in California investigated creativity in the workplace.
By the 1980s creativity was thought more likely to be a trait of personality rather than intelligence.
The latest development is the idea of "creative leadership" in which senior staff are supposed to foster learning organisations which end the blame culture and have systems to reward new ideas, and this is one of the training profession's greatest challenges.
The promise is clear - in order to develop new products, companies need to harness the creativity of staff.
"Because products are now cheaper, quality makes the difference," says Bettina von Stamm, coordinator of London Business School's innovation exchange, "innovation is needed to find new, high-quality products."
Russell Harper, sales and business development manager of the Oxford Psychologists Press/Sigma, adds, "If it's properly understood, innovation should generate better products, improved procedures and better processes."
But Karen Giles, adviser on employee resourcing at the Institute of Personnel and Development, goes further.
"Creativity and innovation aren't just relevant to product development - they're a critical factor in changing the way organisations work," she says.
Pros and cons
Companies in every sector are being urged to take innovation seriously. The downside is that words like "creativity" and "innovation" sound good in company repor