I downloaded a fascinating interview from emusic – an hour long interview with Johnny Carson on humor recorded in the late 1960s (it’s one of several such interviews with famous comedians). In one segment, the discussion turns to ad libbing. Johnny made the statement that rarely do comedians make up something entirely new right on the spot. He said instead, improvisation comes from having a good memory for things that you’ve said, done, or seen previously and the ability to switch things around to fit the current moment.
That’s a great formula for on-the-spot innovation whether it’s comedy or any other situation you face.