Innovation’s Blind Spot
- Paul Egglestone
- Jan 6
- 4 min read
Most innovation systems fail in the same way: not because nothing is happening, but because the most consequential work doesn’t fit their field of vision.
By the time innovation begins to change how systems actually operate — how care is delivered, how energy is governed, how education works — it often no longer looks like “innovation” at all.
And when it stops looking like innovation, it stops being seen.
A quick signpost — then we go deeper
In the first two posts in this series, we showed how innovation systems still privilege launch indicators — patents, spin-outs and R&D spend — even though these metrics capture only a thin slice of real-world innovation and correlate weakly with outcomes.
That argument has already been made.
(For context, see Beyond the Lab: Where Innovation Actually Happens and Beyond the Rocket: What Our Innovation Metrics Miss.)
This post starts further downstream — at the point where innovation isn’t just poorly measured, but becomes structurally invisible.
Institutions don’t just mis-measure innovation. They mis-see it.
Universities, labs, accelerators and innovation agencies are not neutral observers. They are designed systems, optimised to recognise innovation when it is:
early-stage, where novelty is sharp and uncertainty is abstract
formalised, where intellectual property can be owned, licensed or spun out
bounded, where outputs are attributable, auditable and reportable
Papers. Patents. Prototypes. Start-ups.
These things matter — but they represent the least consequential stage of innovation from a public-value perspective. Because once innovation moves into practice, it changes form.
Where innovation goes invisible
Downstream of discovery, innovation stops behaving like a product and starts behaving like a system.
It becomes about:
changing workflows
re-organising roles
building new capabilities
coordinating across organisations
embedding new practices over time
This is where innovation begins to shape outcomes — and where institutional vision fades fastest.
Care and health systems
In health and care, the strongest evidence for improved outcomes points not to constant technological novelty, but to service and system redesign.
The World Health Organization consistently shows that integrated, people-centred health services deliver better outcomes, especially for people with complex and chronic needs (WHO, Integrated Care). These gains come from changes in care pathways, workforce design and continuity — not just from new tools.
Similarly, the OECD’s work on health system performance highlights that coordination, service integration and organisational innovation drive efficiency and equity far more than invention alone (OECD Health at a Glance).
These are genuine innovations.They save lives.They reduce costs.
But they are relational, contextual and embedded in practice. They rarely generate patents or spin-outs — and so they largely disappear from innovation dashboards.
Energy transitions
The International Energy Agency has become increasingly explicit that the main barriers to decarbonisation are no longer technological, but institutional and organisational.
According to the IEA, grid integration, regulatory design, demand-side flexibility, governance and ownership models are now decisive factors in energy transitions (IEA – Energy System Transformation).
Community energy schemes, local storage coordination and demand-side participation are innovations, but they are innovations in systems and governance, not inventions you can easily patent.
They are essential to outcomes — and largely invisible to innovation systems built around labs and IP.
Education and social innovation
In education, the pattern repeats. The most consequential innovations are rarely products. They are changes in pedagogy, assessment, curriculum integration and professional practice — slow, relational innovations that unfold over time.
This has been documented for decades in the social innovation literature. Scholars such as Frank Moulaert and Robin Murray show that innovation often occurs outside markets and laboratories, emerging from collective action, unmet social needs and place-based experimentation (Moulaert et al., Social Innovation and Territorial Development).
These innovations reshape social relations and institutions — but they don’t conform to venture, patent or lab-based models. As a result, they are systematically under-recognised.
Even the official definitions are broader than practice
This invisibility isn’t because these innovations don’t count.
The OECD’s Oslo Manual — the global standard for innovation statistics — explicitly defines innovation to include new or improved products and business processes, organisational methods and delivery systems, so long as they are “brought into use” (OECD Oslo Manual 2018).
In other words: adoption and implementation are part of the definition of innovation itself. More recently, the OECD’s Science, Technology and Innovation Outlook argues for innovation systems that prioritise diffusion, coordination and resilience over linear, invention-centric pipelines (OECD STI Outlook).
The theory has moved on.Institutional practice largely hasn’t.
The real constraint isn’t creativity
We often talk as if innovation systems are failing because there aren’t enough ideas, founders or breakthroughs.
But once you look beyond what institutions are structurally able to see, a different picture emerges:
experimentation is widespread
adaptation is constant
people are quietly reshaping systems every day
The problem is not a lack of innovation.
It is a lack of recognition, continuity and coordination.
Innovation doesn’t fail because nothing is happening.It fails because most of what is happening doesn’t look like innovation to the systems meant to support it.
Why this matters now
Ageing populations. Climate adaptation. Care and workforce shortages. Energy transition. Education and equity.
These challenges are not solved by isolated breakthroughs.
They are addressed through:
sustained changes in practice
governance and institutional redesign
long-term capability building
coordination across sectors and places
If innovation systems remain fixated on what they can most easily see, they will continue funding beginnings and neglecting endings.
They will keep mistaking visibility for importance.
Bringing the whole rocket into view
The rocket image is not about failure. It’s about misrecognition.
Innovation isn’t scarce. Visibility is.
And once you see that, the real question becomes unavoidable:
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