Beyond Carnaval: Are You Seeing Innovation Wrong?
Concise reflections, digests, and highlights of the week's significant news within Brazil's investment and innovation landscape.
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IN TODAY'S BEYOND CARNAVAL:
The Evolution of the Innovation Concept
Innovation Ecosystem and Its Actors
Brazilian Remarkables Actors
Innovation is often hailed as the engine of progress, shaping the way we live, work, and interact. From early computing algorithms to today’s groundbreaking digital technologies, innovation has consistently been at the core of economic development and global competitiveness.
Considering the volume of interactions - and disagreements - we've experienced on our social media profiles, we've decided to create a series of editions to provide context and share data and facts. Our goal is to help our audience draw their own conclusions and explore a more positive perspective on Brazil's potential. After all, Pessimism is an Ugly Addiction , so don't be that person - no one likes them.
This Beyond Carnaval's edition takes a journey through the evolution of the innovation concept, innovation ecosystem and its actors and two importants actors driving innovation in Brazil.
The Evolution of the Innovation Concept
Innovation is a term that takes on many forms, and over the years, as an Innovation Specialist, I’ve come across countless interpretations. This diversity is not surprising, as how one defines innovation often depends on their background, field of expertise, and the context in which they operate.
The minds that have shaped our understanding of innovation nowadays came from different disciplines, countries, and periods. So it isn't wrong to say that innovation is not a fixed concept as it evolves alongside technological progress, societal needs, and fresh perspectives.
More than that, Innovation thrives when we step outside our own boundaries and consider how others have defined and driven change throughout history
Here are some of the key figures who have shaped our modern understanding of innovation. Each following definition reflects the historical context, technological advancements, and the unique perspectives of those who proposed it.
1. Peter Drucker (Management & Business)
Definition: “Innovation is the specific instrument of entrepreneurship. The act that endows resources with a new capacity to create wealth.”
Historical Context: Drucker’s work, primarily in the 1950s to 1990s, took place during a period of post-war industrial growth, globalization, and the rise of multinational corporations. He emphasized that innovation was central to business strategy and entrepreneurship, recognizing its potential to create new markets and economic opportunities.
2. Joseph Schumpeter (Economics)
Definition: Innovation is the process of “creative destruction,” where new products, services, or processes replace outdated ones, driving economic development.
Historical Context: Schumpeter’s influential work, particularly during the 1930s and 1940s, came in the aftermath of the Great Depression. He saw innovation as the catalyst for recovery and long-term economic growth, linking it to cyclical phases of boom and bust in capitalist economies.
3. Clayton Christensen (Business & Disruptive Innovation)
Definition: Disruptive innovation occurs when smaller companies successfully challenge established businesses by offering simpler, cheaper, or more convenient solutions.
Historical Context: In the 1990s, Christensen introduced his theory at the dawn of the internet era. During this time, companies like Amazon and Netflix were beginning to disrupt traditional industries with innovative business models, changing the landscape of commerce, media, and more.
4. Tim Brown (Design Thinking)
Definition: Innovation is a human-centered approach that integrates the needs of people, the possibilities of technology, and the requirements for business success.
Historical Context: Tim Brown’s work on design thinking became prominent in the 2000s, as businesses began to emphasize user experience and interdisciplinary approaches to solving complex problems. This era of digital transformation emphasized the importance of technology and human-centered design for successful innovation.
As seen, the concept of innovation has evolved significantly over time, shaped by various figures who have contributed their unique perspectives based on the historical and technological contexts of their eras.
Each definition adds a layer of understanding to the multifaceted nature of innovation, illustrating how it continually adapts to changing environments and emerging trends.
Innovation Ecosystem and Its Actors
Just like its definition, over the years, the configuration of the innovation ecosystem has been reshaped by technological advancements, globalization, and evolving business models.
Initially, large corporations and research institutions were the primary drivers of innovation, with heavy investments in in-house R&D (Research & Development). However, as the digital economy expanded, startups and entrepreneurs began to play a more central role, bringing agility and disruptive technologies. Open innovation models encouraged collaboration between corporations and smaller players, fostering a more networked and collaborative approach. Venture capital also grew in importance, as investors sought to back high-growth startups. Additionally, governments began crafting policies and incentives to support innovation, shifting from traditional regulatory roles to active ecosystem facilitators.
Today, what is commonly considered as the innovation ecosystem is driven by a complex, interconnected web of global actors, where knowledge, capital, and talent flow across borders.
Brazilian Remarkables Actors
Especially in a country as big and complex as Brazil, there are several actors involved in this interconnected web. To exemplify this ecosystem, we elected two different actors that are doing some remarkable contributions to raise our country's economic development and global competitiveness:
Natura
One of Brazil's most innovative and influential companies, investing R$ 341.8 million in research and development in 2022, with a focus on business innovation and sustainable solutions. Ranked 6th in the Valor Inovação Brasil 2023 and among the world's top 10 most innovative companies by Forbes, Natura's innovation strategy drives its business, with 57.4% of its 2022 revenue coming from products launched in the past two years.
The company adopts a multidisciplinary approach, involving researchers, communities, and its teams through initiatives like Natura Campus and the Amazon Innovation Hub (NINA), while implementing a multichannel strategy to expand its presence. Led by the Vice-Presidency of Innovation, Natura's structure emphasizes advanced research, product development, and open innovation, reinforcing its commitment to sustainability and social impact.
ITA (Instituto Tecnológico de Aeronáutica)
A key driver of innovation and technology in Brazil, particularly in aerospace. Established in 1950, ITA has shaped the country's technological growth, most notably through its role in creating Embraer, one of the world's largest aircraft manufacturers.
Modeled after MIT, ITA offers top-tier engineering programs and serves as a hub for research and development. It has produced highly skilled professionals and fostered innovations in areas like artificial intelligence and aerospace systems. ITA also maintains international partnerships, strengthening its research impact.
As - I hope - you could see, innovation, as a concept, is dynamic and multifaceted, consistently evolving to meet the needs of societies and economies worldwide. In Brazil, companies like Natura and institutions like ITA showcase the country’s potential to be a global player in innovation. Their achievements highlight the importance of collaboration, sustainable development, and technological advancement in driving progress.
Despite the challenges and skepticism that may arise, it's essential to approach Brazil's innovation ecosystem with a balanced perspective. By acknowledging both the achievements and the obstacles, we can cultivate a deeper, more nuanced understanding of the opportunities ahead.
In our upcoming editions, we will delve further into the role of government and public institutions within Brazil’s innovation landscape. While politics and public entities can be sensitive topics, especially in Brazil, sharing facts, engaging in discussion, and even disagreeing are part of what we do to decipher Brazilian potential globally.
We can't wait.
AWS Invests in Brazilian Infrastructure: AWS announced an investment of R$ 10.1 billion to expand its data centers in Brazil. This significant investment aims to enhance cloud infrastructure, support local businesses, and drive innovation by increasing the capacity and efficiency of AWS services in the region. (Source)
Terracotta Ventures Expands Beyond Equity: Terracotta Ventures is diversifying its approach, offering real estate funds, debentures, and FIDCs in addition to equity investments. This strategy aims to provide proptech and fintech startups with more tailored funding solutions. Source
Hardware Startups Lead Climate Tech Innovations: Hardware-based startups are leading the climate tech space, focusing on carbon emission reduction in industries like manufacturing and energy. Their growth reflects the increasing demand for physical solutions to tackle climate change.Source
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Every Thursday 06:09 am (BR time), the Beyond Carnaval newsletter offers concise reflections, digests, and highlights of the week's significant news within Brazil's investment and innovation landscape.
Delivered on the first Saturday of the month at 06:09 am (BR time), the Open Zeitgeist newsletter provides a space for both Brazilian and "gringo" guests to share their perspectives on Brazilian investment opportunities.
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