[Conceptual abstract from my book Monetising Innovation (A Bloomsbury Publication). Detail in www.gautamborah.com]
Types of Innovation – Various Perspectives
To most people, the word innovation probably resembles the marks of a Tibetan bell. When a Tibetan bell is stuck or rubbed with a stick, it tends to peak and resonate with the same shrilling sound. Similarly, innovation, for most, tends to reverberate the extreme form of it – a disruptive or radical innovation, when a new product supplants an established one. However, not all innovations can harbinger the death of the old order, like the typewriter or a B & W television, or even a pager. It, as in the innovation equation, just contrives something new, that pays off in terms of business results.
It is important to view the types of innovation from the following perspectives:
(A) From the perspective of market / industry impact
(B) From the perspective of a value chain
(C) From the perspective of a product life cycle
The following discussion elaborates each perspective in detail.
(A) Market / Industry Impact Perspective
Radical or disruptive innovations and incremental innovations are the most prosaic phrases, when one tends to mention innovation. These terms intrinsically consider the fact that the market / industry have a fundamental shift or a disruption owing to the new product. This context is elaborated in the following illustration.
Radical or Disruptive Innovation
Many times, a common perspective is to equate innovation with this type, also referred many times as breakthrough innovation. This is when a disruptive technology under-perform established products in mainstream markets. Products based on disruptive technologies are typically cheaper, simpler, and frequently more convenient to use’.1
Some examples of disruptive innovations are mobile phones with respect to pagers, CD drive created the obsolescence of floppy drives. The most recent example is of Whatsapp or similar products like Wechat, which have been pushing traditional texting to oblivion. Another example is of Google that created a whole new domain of Internet search, and is ever expanding to create newer territories.
Incremental innovation refers to any improvement in the product, process, or other activities across the value or in the product life. In case of incremental innovations, fundamental characteristics of the existing product and markets are retained. One example of incremental innovation is the new features / add-ons in a software product, or even in Facebook, that enhances customer experience. Another example may be of an anti-theft software that one can add in a mobile phone.
(To be Continud)