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Inductive reasoning dominates current business thinking. This is why people look to case studies and best practices for guidance in their endeavors. It also leads to the belief that strategic management is more science than art. But, this viewpoint is provincial in nature. Inductive reasoning can reduce risk, but innovation requires a leap of faith for which there is little evidence.

The flaw in relying solely on inductive reasoning has been widely discussed in philosophy. Just because something generally happens one way doesn't mean it's guaranteed to be a repeatable outcome. Inductive reasoning isn't fool proof. You can't always learn the truth from past observation. Or, as aptly illustrated by Bertrand Russell in his story of the Chicken:

A chicken wakes every morning assuming a farmer will feed it. Day after day it's fed by the farmer. This is a reasonable expectation. After all, it happens every day. The chicken believes that seeing the farmer means he gets fed. But, one day the farmer comes and wrings the chicken's neck.

This doesn't mean inductive reasoning should be removed from your strategic toolbox, but instead it needs to be tempered with the realization that nothing is ever guaranteed. Requiring proof something will work is the surest way to guarantee that you'll always be one step behind. There isn't a case study for something that's never been done before. Innovation requires a different approach to problem solving. It requires abductive reasoning.

Abductive reasoning is a term that was originally coined by Charles Sanders Peirce. He viewed the scientific process as starting with a guess based on observation and intuition. This initial guess is an example of abductive reasoning. It's an explanation for what might be -- not an explanation of what is, or of what's been.

This is the basis for innovation. There is no blueprint for doing something new. You can observe and learn from previous research, but at the end of the day, you have to make that initial leap of faith. You have to guess and then work to prove what might be.

Next time a client or executive comes to you and asks for something innovative, Remind them that true innovation can't be supported with case studies of previous successes. Social media marketing right now is undoubtedly hyped, but just because there aren't books full of successful case studies (beyond customer service related campaigns) doesn't mean it's potential has been squandered. Instead it means that you'll have to take a leap of faith and try something new. After all, that's the first step towards innovation.

Small companies have to differentiate. One way to do so is by creating marketing tools that get noticed. That's why a boutique fire truck manufacturer in Atlanta decided that they could no longer afford to play it safe. They had to innovate.

The first step was building a website that lived up to their brand's potential (http://www.foutsfire.com/). It wasn't easy. They needed to get professional quality photography of all their trucks, they had to rework their messaging from the ground up, and rethink the way they thought about their customers. It was an expensive step for a small company, but it was necessary.

The second step was to develop something that would help them get noticed at trade shows. How do you get noticed at a fire truck convention? You do something innovative. In this case, you build a custom touch screen application that let's fire chiefs interact with your products in a way that they've never experienced before. It might not be the same as going for a test drive, but we feel like it's the next best thing.

Check out the demo below:

Most vision statements are useless. It's not because vision statements are "bad." Instead it's because they rarely stand for anything. Where most vision statements fail is that they don't acknowledge a basic rule of writing. They rely on worn out cliches and phrases. They feel generic and insipid. In short, they're the epitome of bad writing.

George Orwell once described the first rule of writing as:

Never use a metaphor, simile or other figure of speech which you are used to seeing in print.

This is easier said then done. Cliches are easy to come up with, familiar and safe, but they're not helpful. What does "leading edge" mean? How does the goal of becoming a "thought leader" help you decide if a feature should be included/excluded?

If you can't make your vision statement concise and meaningful, then you're better off not having one.

Toyota is famous for their production process. They designed a system that eliminated waste, stress and inconsistency to levels that were previously considered implausible. Books have been written on the process. But, what isn't well known is that their paradigm-shifting production process was based on a very simple insight originally developed by Sakichi Toyoda.

Sakichi was the father of the Japanese industrial revolution. He cut his teeth building weaving devices and looms. When trying to perfect an automated loom, he actually conducted a year long experiment that had his looms running against his competitors in a real world environment. As each of his looms failed he focused on how to improve their performance.

The methodology he used was simple. Like any good problem solver, he started by asking "Why." But, he realized that you can't get to the root of the problem with a single question. A single question only identifies the symptom, not the root problem.

Like a child trying to figure out why the sky is blue, he repeated the question a minimum of 5 times in order to get to the root of the problem. This simple insight was the birth of what is known today as "the 5 whys method."

Why did the loom break? Because the gear jammed. Why did the gear jam? Because it ran out of oil. Why did it run out of oil? Because the operator didn't add it. Why does the operator need to add oil? Because oil isn't automatically added. Why isn't oil automatically added? Because there isn't an oil pump.

Sakichi's method of root cause analysis is now taught in MBA programs around the world. But, his genius wasn't related to some magic insight. The "5 Whys" method is applied common sense. It's development was the result of his fierce tenacity in trying to get to the root of his problems. His brilliance was that he institutionalized this tenacity among his process engineers. He "made it stick" by giving it a memorable name ("the 5 whys") and in the process he revolutionized process manufacturing.

So next time you're asking yourself, "what went wrong?", remember Sakichi Toyoda and the 5 whys. It may annoy your co-workers, but at least you'll be closer to the root of the problem.

Scott Berkun is the author of "The Myths of Innovation". One of the most interesting myths that he debunks is also one of the most widespread. The myth is: people love new ideas.

The reality is the exact opposite. People don't like new ideas. An innovative product rarely succeeds because it's a better solution. If it was, we'd all use the metric system, have twheels on our car, and use robertson screws.

So why do innovations succeed? Berkun outlines the following 5 key factors:

• Relative Advantage: You can predict how successful an innovation will be by looking at the perceived value of the innovation compared to the current solution. Is it easier to use, better to look at, more reliable, more effective, etc?
• Compatibility: How hard is it to start using? If the cost of switching to the solution is high, then people won't transition. The transition has to be less expensive than the perceived value of the advantage you gain.
• Complexity: How big is the learning curve? If it requires people to re-learn old habits then you have serious impediments to adoption.
• Trial-ability: Can people take it for test drive, or give it a trial run? The easiest way to overcome someone's objections is to let them try it.
• Observability:How visible are the results of innovation? The more visible the benefit, the faster the idea spreads.

In short, innovations that are easy to adopt and highly visible spread faster than those that aren't.

Superficial innovations (like fashion trends) spread quickly because they are highly visible and the cost to transition to them is low—especially when compared to the perceived benefit of increased social status. However, something like transitioning to the metric system, which requires an entire country to change their measuring cups and throw out their old cookbooks, rarely happens on it's own.