Most companies today have innovation envy. They yearn to come up with a game--changing innovation like Apple's iPod, or create an entirely new category like Facebook. Many make genuine efforts to be innovative--they spend on R&D, bring in creative designers, hire innovation consultants. But they get disappointing results.

Why? In The Design of Business, Roger Martin offers a compelling and provocative answer: we rely far too exclusively on analytical thinking, which merely refines current knowledge, producing small improvements to the status quo.

To innovate and win, companies...