It's a wonderful term and it was invented by Adrian Slywotzky of Mercer Management Consulting. The term is "Demand Innovation." Interestingly, Slywotzky is not that hot on invention. He contends that, “in most industries, truly differentiating new-product breakthroughs are becoming increasingly rare.” He coined his term to point out that the action is shifting away from breakthrough product innovations to a focus on incremental, customer-focused process innovations.

As the Economist Magazine notes in its most recent issue, big companies, in particular, are better at "improving the ways in which products invented elsewhere are manufactured, marketed and continually enhanced" than they are at creating the next new thing. "Even Henry Ford, whose name is almost synonymous with four-wheeled transport, did not invent the automobile. He 'merely' invented a far superior way to manufacture it—namely, the mass-production assembly line."

In his recent book How to Grow When Markets Don't, Slywotzky and his co-author Richard Wise point to companies such as Air Liquide and Johnson Controls as examples, noting how they have generated profits “by discovering new forms of demand.” Indeed, they discovered high-value services and solutions around the increasingly commoditized products they were producing. Having sold industrial gases for decades, Air Liquide, a French firm, got closer to its customers and became a provider of high-margin chemical- and gas-management services.

Not an amazing breakthrough -- merely a powerful application of customer intelligence and an impressive show of customer value creation.