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The phrase "potential for innovation" is correct and usable in written English.
You can use this phrase to indicate when something could be improved, changed, or developed further, such as in this example: "The new technology has great potential for innovation."
Exact(60)
There is huge potential for innovation in the public sector.
Mr. Mehta envisions great potential for innovation at the Philharmonic.
Bright ideas Bike lights offer almost endless potential for innovation.
Innovation capacity is the organization's potential for innovation.
Without creativity in design there is no potential for innovation.
But Mr. Chang warned that the market may soon be lagging behind the potential for innovation.
Certainly, China has shown a potential for innovation and has the capacity to do much more.
But it's not all missed opportunities: Yahoo still has the potential for innovation.
There is huge potential for innovation in the daily lives of disabled people.
In this context, developing biomimetic design solutions for buildings have a great potential for innovation.
We've found through our years of research and writing that this mix greatly increases the potential for innovation.
More suggestions(15)
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Since I tried Ludwig back in 2017, I have been constantly using it in both editing and translation. Ever since, I suggest it to my translators at ProSciEditing.

Justyna Jupowicz-Kozak
CEO of Professional Science Editing for Scientists @ prosciediting.com