Creativity is the ability to think and act in ways that are new and novel. In our minds, there are two kinds of creativity, innovation and invention.
Innovation is thinking creatively about something that already exists (e.g., the tape recorder, Walkman, and CD player are all innovations on the phonograph). Invention is creating something that did not exist before (e.g. the phonograph). A business example illustrates the difference clearly. When a team bases its plans on the way the team has operated in the past, they are open only to innovation, such as increasing efficiency. However, a team that is inventive will ask itself: Can we create a different way to operate, one that will produce a different way of doing business?
Experimentation is the process by which people become creative. When you experiment, you don't know the outcome. You can only guess. Often, experimentation leads to a surprise -- something you didn't expect. This is the power of creativity.
Organizations today need more invention than innovation. This means that people in organizations need to release their creativity in ways that are quite different from the tried-and-true methods of the past. It also means that organizations need to be open to more experimentation to find out what works and what doesn't.