DEFINITION of 'Ideation'

Ideation is the process of forming and relating ideas, oftentimes in a business setting. It is used to describe the sequence of thought, from idea generation to idea implementation, which is the result of mental activity that can be based on past or present knowledge, thoughts, opinions, convictions or principles. Ideation is meant to conceptualize an idea and is the thought processes involved in apprehending and expressing a new concept, sometimes in a graphical or other similar depiction.

BREAKING DOWN 'Ideation'

Simply put, ideation is the literal action of forming ideas. It is made up of each and every process used by a person to take an idea from its moment of conception to its real-world application and implementation. Ideas and the act of ideating can come from anyone within a business or organization. These people include employees, managers, customers, partners and stakeholders, and the actual ideation can come from brainstorming sessions, online forums, collaboration tools, surveys and social media.

Ideation is a key component to any successful business. Companies such as Google, for example, allow employees to spend as much as 20% of their work hours thinking and coming up with new ideas that excite them and also solve a very real problem. This focus on ideation allows companies to become or remain innovative, increasing the chances for new products, customer acquisition and increased financial performance.

The General Ideation Process

The ideation process is not a hard rule. However, there are general guidelines people follow to help them maximize the effectiveness of ideation and the solutions it generates. First and foremost, ideation does not necessarily start with an idea. Typically, it starts with a problem that needs to be solved. Therefore, it is important to first clearly define the problem and understand its underlying factors, such as the industry, business environment, customer needs, budget constraints and more.

From there, brainstorming sessions and other collaborative efforts are initiated to crowdsource potential ideas and solutions to the problem being posed. This collaboration should be a blend of right brain and left brain thinking, since many problems require both creative ideas and a pragmatic approach to being solved. The idea is not to limit the person or group participating in the ideating process. Instead, all ideas, both wild and analytical, should be treated with fairness.

The slew of ideas generated during collaboration are then paired down into one main idea that drives the future actions of the group. The main idea is tested against the problem and adjusted as needed, only to be retested and repeated until a potential solution is found. The solution is then implemented in the real world, and if successful, the ideation process closes.

RELATED TERMS
  1. Investment Ideas

    Specific views, plans or ideas on ways to invest money effectively. ...
  2. Stock Idea

    A note of suggestion or thinking that initiates the further analysis ...
  3. Lucrative

    To produce wealth. To be lucrative, means that an item or idea ...
  4. Elevator Pitch

    A slang term used to describe a brief speech that outlines an ...
  5. Turnkey Solution

    A type of system that can be easily implemented into current ...
  6. Business Relations

    The connections that exit between entities involved in the business ...
Related Articles
  1. Investing

    Using Licensing to Rent Your Ideas to Large Companies

    Learn how to license your ideas to get your groundbreaking product on the shelves without raising capital or having business expertise.
  2. Small Business

    5 Key Steps to Start Your Own Small Business

    Understand what a small business is and what it takes to build one. Learn about the five key steps needed to start a small business.
  3. Trading

    5 Ways to Get Funding For Your Billion-Dollar Idea (FB)

    Understand how current billion-dollar companies gone about funding. Learn about five funding strategies to fund a billion dollar idea.
  4. Small Business

    The Basics of Business Development

    What exactly is business development? Sales, marketing, growth? It's all that and more. Investopedia explains the concept and provides examples.
  5. Small Business

    Creating A Feasibility Report With TELOS

    TELOS is an excellent resource if you're looking to create a feasibility report for your small business. Here are ways you can best implement the system.
  6. Managing Wealth

    Protecting Your Idea From Angel Investors

    If you need outside financing to grow your business, be careful about whom you decide to talk to and what information you offer them.
  7. Small Business

    The Top 10 Best Ways To Turn An Idea Into Money

    A job no longer has to be your only source of income. Thanks to the Internet and other outlets, people can more easily turn their ideas into real money.
  8. Small Business

    Ready For The Entrepreneurial Leap?

    There are key traits and motivations that characterize an entrepreneur; these aren't necessarily genetic, but can be acquired over time.
  9. Managing Wealth

    6 Top Skills You Need On Your Resume

    It’s imperative for job seekers to distinguish themselves, and a good way to do so is by showing you possess the skills that are in the highest demand.
  10. Small Business

    How to be Entrepreneurial at a Large Company

    In order to act as an intrapreneur, you must focus on processes, leverage a network and have the courage to strategically shake things up at the office.
RELATED FAQS
  1. How can small businesses manufacture demand?

    Create demand for a small business product or service by focusing on the brand and market. Continue to learn offer excellent ... Read Answer >>
  2. How has investing in the Internet sector evolved over time?

    Learn how early investors of the Internet sector received a valuable lesson and influenced modern-day markets after the dot-come ... Read Answer >>
  3. What skills do I need to become a Portfolio Analyst?

    Learn what a portfolio analyst does and some examples of skills and knowledge one must possess to become a successful portfolio ... Read Answer >>
  4. What is the relationship between research and development and innovation?

    Understand what research and development is and why a company or person would want to conduct it. Learn about how it can ... Read Answer >>
  5. What are some of the limitations and drawbacks of economics as a field?

    Find out why the field of economics is full of controversy. Policy decisions, political campaigns and personal finances are ... Read Answer >>
Hot Definitions
  1. Graduate Management Admission Test - GMAT

    A standardized test intended to measure a test taker's aptitude in mathematics and the English language. The GMAT is most ...
  2. Magna Cum Laude

    An academic level of distinction used by educational institutions to signify an academic degree which was received "with ...
  3. Cover Letter

    A written document submitted with a job application explaining the applicant's credentials and interest in the open position. ...
  4. 403(b) Plan

    A retirement plan for certain employees of public schools, tax-exempt organizations and certain ministers. Generally, retirement ...
  5. Master Of Business Administration - MBA

    A graduate degree achieved at a university or college that provides theoretical and practical training to help graduates ...
  6. Liquidity Event

    An event that allows initial investors in a company to cash out some or all of their ownership shares and is considered an ...
Trading Center