Innovation-leadership
1•What is Innovation?
Innovation refers to the process of creating something new or improving upon an existing idea, product, or service in a way that adds value to society. It involves the introduction of new concepts, technologies, or methods that can lead to improvements in efficiency, effectiveness, or competitiveness. Innovation can occur in various fields, including technology, business, healthcare, education, and the arts, among others.
2•What are the different types of innovation?
Over time, we’ve created a distorted view of innovation as predominantly scientific and highly disruptive. These are both inaccurate assumptions, as is the idea that innovation is the lone work of a generation-defining genius. Instead, the following projects have managed to capture the sheer variety of exactly what can be considered innovation:
🔸The Innovation Matrix
One of the most common ways of looking at innovation is via the Innovation Matrix, which is included below.
The Innovation Matrix classifies innovations according to both the technology it uses and the market it operates in. Therefore, it allows us to conceive of four distinct forms of innovation:
🔹Architectural innovation
Architectural innovation happens when existing products are redesigned to service a new market. Some redesigns are basic, like making a product smaller, while others are more complex. When a company redesigns components to improve the overall product or service, they are innovating. An architectural innovation changes the product or service without changing the purpose.
Architectural innovation is a more accessible form of innovation for businesses and innovators to achieve, and it’s been proven to be a powerful business model. This innovation makes the product or service significantly better without changing the core value.
Architectural Innovation Examples
Multiple architectural innovations have been created to benefit society. Here are just some examples of architectural innovation:
The Desktop Photocopier
Before desktop photocopiers, stand-alone copiers were the only available option. Stand-alone photocopiers stood high and took up lots of space. Because of this, stand-alone copiers only benefited large corporations. Desktop photocopiers were innovative to the public simply because they were smaller, saving small/medium-sized businesses space. The desktop photocopier made it easier to use and applicable to a broader market without changing the product’s core value. (Source: PROCTO)
Laptops
Before laptops, desktop computers were the only option. The invention of the laptop provided portability, allowing users to have a computer on the go. Although not wholly practical for users requiring more extensive personal computing power, laptops have dominated the computer market becoming standard for office workers and individual users alike.
Global Positioning Systems (GPS) on Smartphones
Before the smartphone, a GPS was often a big clunky brick that you’d have to install onto the inside of your car’s windshield or was built into the vehicle. The GPS was designed specifically for vehicles and started as an expensive luxury item for drivers who didn’t want to use maps or printing directions before a road trip.
Today, GPSs are standard apps on almost all smartphones. By downloading an app like Google Maps, nearly anybody with a smartphone now has a global positioning system, whether walking, biking, or driving.
These examples of architectural innovations don’t change the primary components of the product or service. They adjust the design to provide innovative benefits.
🔹Radical innovation
Radical innovation creates an entirely new product, service, or system and provides it to a new market.
Radical innovation, along with disruptive innovation (more on that later), is what most think of when they envision innovation. It’s a high-risk, high-reward situation for businesses, as changing how a system works doesn’t happen overnight. It takes years and sometimes decades to change how a whole marketplace functions.
Radical innovation often replaces current products or services with brand new product or service categories — creating an entirely new market (Source: Design Council).
It’s also not surprising to see backlash coming from companies losing business or the customers who are too used to what they have.
Radical Innovation Examples
Officially launching in 1998, Google is a well-known example of radical innovation.
With the widespread use of the internet just beginning and the steady creation of thousands of websites, the internet needed a directory to help users search what they were looking for online, and that’s just what Google does best. Compared to other online search directories like Yahoo, Google’s PageRank algorithm and simplistic design made Google’s search engine the most popular (Source: Search Engine People).
Search engines were brand new at the time, and as the internet took over, Google’s search engine eventually replaced traditional directory methods such as phone books like Yellow Pages.
Blockchain Technology
In short, Blockchain technology is a data structure that records transactions between multiple computers. The blocks of data created are interconnected, forming a chain of records not controlled by a single authority and open to any blockchain member.
Once information is stored, the blockchain secures each transaction with a virtual signature to prove its authenticity. The data is then stored, making it tamper-proof, and can’t be changed. This ensures higher security, transparency, and decentralization for users and company operations.
Blockchain is an entirely new technology that can be used in any industry, making it a radical innovation for virtually any business as digital transactions can be inserted into the blockchain.
Many industries use blockchain technology, such as banking, finance, and telecom. The cybersecurity industry is also beginning to use blockchain as well.
Discover how organizations use blockchain for cybersecurity in our article: The Benefits and Vulnerabilities of Blockchain Security
🔹Incremental or Sustaining Innovation
Unlike architectural innovation, incremental innovation (also called sustaining innovation) improves and upgrades existing products or services for existing markets over an extended timeframe. These improvements increase the product or service’s competitiveness by providing a more efficient or productive model than in the past.
Incremental innovation is the most common type of innovation that businesses and firms use to compete in the marketplace. However, because incremental innovation isn’t fancy, it’s often overlooked. Incremental innovation looks boring — only tweaking a product or service occasionally. Still, it is one of the simplest forms of innovation to produce with lower risk. Adding value to a well-known and purchased product or service often goes a long way in sales if the main benefit isn’t completely changed.
In most industries, incremental innovation isn’t optional. It’s a necessity. Businesses in competitive marketplaces are continually adding new functions or features to their products/services because if they don’t, they’ll die.
It’s common to see added features yearly, but sometimes it takes longer or shorter depending on the business and the marketplace it’s competing in.
Incremental Innovation / Sustaining Innovation Examples
Examples of incremental innovation are everywhere. Anytime an upgrade to a previous product or service is introduced, it’s incremental innovation.
Here are two examples to clarify:
iPhones
iPhones are a prime example of incremental innovation. At least every year (if not more), Apple releases a new iPhone model upgrading the previous year’s phone. By adding new features and specs, such as a larger (or smaller) screen, updated camera, or fingerprint recognition, iPhones are continually improving on the product they have, remaining competitive and innovative.
Fitbit
Fitbits are another example of incremental innovation. Created in 2007, the Fitbit device allows users to track their health by wearing a wristband that records personal data such as steps taken, heart rate, and overall sleep. Since its creation, the Fitbit has seen numerous upgrades and added health data to track — all forms of incremental innovation.
🔹Disruptive innovation
Disruptive innovation takes up the last section of the Henderson-Clark model, referring to a process that creates new customer value by entering an existing market with a new product or service.
Harvard professor Clayton Christensen created the idea behind disruptive innovation, describing it in the Harvard Business Review and in his book called The Innovator’s Dilemma (Source: HBR).
Created from scratch, disruptive innovations start as niche processes, products, or services only wanted by a small number of customers within the marketplace. They do not appeal to the mainstream market — at least not yet. However, over a long period, the disruptive innovation catches up to its competitors and flips the market upside down on them, becoming the favoured product or service instead.
Unlike radical innovations, disruptive innovations are the underdogs of the market. They start looking weak and powerless but turn the fight for market domination to their advantage over a more extended period.
But how is this possible? How does a small startup revolutionize the marketplace when stacked up against market leaders and all their resources?
According to the theory, market leaders don’t focus on massive changes with loads of risk. Instead, they focus more on small minimal product or service enhancements over more extended periods (see Incremental Innovation above).
This opportunity gives smaller firms the advantage to flip the market in their favour by creating an alternative solution for the marketplace’s problems. Slowly, the market leaders lose customers to the small innovator until eventually the market leader copies the innovation — but often, it’s too late at that point.
Disruptive Innovation Examples
Netflix
Netflix is a go-to example for disruptive innovation. Created in 1997, Netflix was a rent-by-mail DVD service where users could order movies to rent online then receive them in the mail to watch. It wasn’t until 2007 when Netflix introduced their online movie streaming service. Streaming changed the way viewers could watch videos (Source: Interesting Engineering). Netflix caused a massive shift in the movie renting industry, causing giant companies like Blockbuster and Movie Gallery to go out of business. Today, only one Blockbuster is left (So
