What is meant by innovation ? Explain the elements in the innovation process. Why is trendspotting important for the success of any business ? Explain the four ways in which an entrepreneur spots trends.

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**Innovation** is the process of entrepreneurship which involves the translation of a useful idea into an application which has commercial value. It takes persistent effort to work out analytically the details of the enterprise or service, to develop marketing strategies, to organise finances and strategize operations. Creativity supplies the idea; innovation converts it into commercial value.

The **elements of the innovation process** are:

1. **Analytical planning** — Carefully identifying the product or service features, design, and the resources that will be needed. This establishes what is to be produced, how, and with what inputs.

2. **Organising resources** — Obtaining the required resources — raw materials, technology, human resources and capital — and arranging them into a workable structure so that development can begin.

3. **Implementation** — Applying the resources in order to accomplish the plans and deliver results. This is where the idea is executed and the product or service actually takes shape.

4. **Commercial application** — Providing value to customers, rewarding employees and satisfying the stakeholders. This is where the innovation is accepted by the market and generates value.

All four elements are sequential and interdependent — a weakness in any one stage can derail the entire innovation effort.

**Trendspotting** is important for business success because it helps the entrepreneur understand the market and produce goods or provide services in sync with market trends. One of the keys to business success is to anticipate what the market will want or need before the entrepreneurs are aware of it themselves. Since it is unlikely for an entrepreneur to see into the future, the best way to do this is to become a trend-spotter.

The **four ways** in which an entrepreneur spots trends are:

1. **Read trends** — Regularly reading leading publications, websites, industry publications, trade association sites, major newspapers, key business magazines, thought leaders and influential bloggers. Using tech-tools like RSS feeds and e-mail newsletters to stay on top of information.

2. **Talk trends** — Getting involved in industry trade associations, attending events online and offline, talking to customers and prospective customers, using social media and online surveys to learn what customers are thinking, buying and craving.

3. **Watch trends** — Regularly going where target customers hang out — the local mall for teenagers, 'power lunch' restaurants for business people — and observing what people are eating, doing, wearing and using. Trade shows are also a great place to get trend ideas.

4. **Think trends** — As entrepreneurs absorb and mull over what they have read, heard and observed, they develop a 'trend-spotter mind' and make connections that lead to business-boosting insights.