The word innovation has several meanings. To start with, the unavoidable wikipedia gives us
The term innovation derives from the Latin word innovatus, which is the noun form of innovare “to renew or change,” stemming from in-“into” + novus-“new”. Although the term is broadly used, innovation generally refers to the creation of better or more effective products, processes, technologies, or ideas that affect markets, governments, and society.
Alternatively, the EU stipulates that
Innovation consists of the successful production, assimilation and exploitation of novelty in the economic and social spheres.
From businessdictionary.com we get
The process by which an idea or invention is translated into a good or service for which people will pay, or something that results from this process.