Innovation can come up as a novelty newness (or disruptive) or an improved solution (or incremental) and spaced as products, processes, and technology. In this article, I highlight the differences between disruptive and incremental innovation and how they work to make innovative values.   

Disruptive innovation

It is a process of targeting the demand of low-end customers and non-consumption customers with better offering products and lower selling prices (Christensen, 2003)¹. It will disrupt the market by offering new and more convenient products or products with upgraded features and lower selling prices. Disruptive innovation comprises low-end and new-market innovations that serve people for whom either no existing products or existing products were neither affordable nor accessible for a variety of reasons. These innovations transform complicated and expensive products into ones that are more affordable and accessible to many people. Not only disruptive innovation creates markets, but it also creates jobs because the new market will need more jobs to manage marketing, distribution, sales and production (Christensen, Ojomo, and Dillon, 2019)². Radical innovations introduce new concepts that contribute to the creation of new products and services, paving new markets and applications (Carayannis, Samara, Bakouros and Yannis, 2015)³. For example, introducing smartphones in the early nineties that replaced landline phones disrupted the market by introducing new values and changing the game of rules.

Sustaining or incremental innovation

On the other hand, incremental innovation targets the demand of high-end customers and existing markets with a better performance of improved products. Sustainable innovations are basically improvements to existing products or processes. Incremental innovations usually end up with a high-price offering than they used to be (Christensen, 2003)⁴. Yet, it may also end up decomposing offers and prices of existing products. For example, airlines recently become more cost-conscious; thus, they decompose services to reduce price offers. Incremental innovations are typically improved products or offers of existing solutions and target customers who require better performance or offers from existing products. Sustainable innovations target customers and capture more sales or, at least, retain market share in the existing market (Christensen, Ojomo and Dillon, 2019)⁵. Incremental innovations exploit the potential of established domains as improvements in the value of technology and adding attributes of performance, safety, quality or cost (Carayannis, Samara, Bakouros and Yannis, 2015)⁶. For example, improved computer storage, speed and size are all practices of incremental innovations.

How do disruptive and incremental innovations work?

Disruptive innovations that result in making new products in a non-existence market or reintroducing products for low-end customers (e.g., reproducing an office printer after years of giant printers’ domination of the business market). This type of innovation can be a breakthrough technology, new products, applications, and platforms. The key players of such innovation are research centres, techies, early adopters (or so-called visionaries), and early majorities (or so-called pragmatists). As disruptive innovations involve making new products, they will require massive investments associated with higher risk, vision and commitment to change the game rules. Trying to depict the lifecycle of the disruptive innovations, they will be mostly spread in the introduction (as breakthrough technology) and growing phase (as technology products, applications, and platforms).

Contrarily, incremental innovations involve two paths of activities, the first is the customer intimacy innovation (deals with existing markets), and the second is the operational excellence innovation (deals with existing businesses). Customer intimacy innovation involves product extension (e.g., adding a new production line), product enhancement (e.g., improving the features, specification, and quality of existing products), increasing customer experience (e.g., customer services, brand loyalty, distribution, promotion, engagement, and payment method), and marketing offers (e.g., product, pricing, and payment terms). While, operational excellence involves increasing operational efficiency, which includes value-creating and upgrading, upgrading technologies, mitigating waste, increasing time leading to the market, and reducing costs. Both paths of innovation take place at the end of the growth and maturity of the technology lifecycle. Incremental innovation often aims at sustaining the market share of businesses, and by this, it will require fewer investments and risks than the case of disruptive innovations. Attributes of businesses carrying incremental innovations are late majorities (or so-called conservatives) and laggards, decelerating growth rate, facing fierce competition, using widely-used technologies, and products will become commodities (or similar to each other).

• This post is sourced from my new book- Your Guide To Reach Innovation. 
• For more information about the book: https://growenterprise.co.uk/your-guide-to-reach-innovation/
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Final note: the book- Your Guide To Reach Innovation, is an actionable guide to innovation from beginning to end. Enjoy reading the book, and I look forward to your reviews.

Author: Munther Al Dawood

www.growenterprise.co.uk

maldawood@growenterprise.co.uk

References:

1. Christensen, C. 2003. The Innovator’s Solution, Harvard Business Review Press, Harvard.
2. Christensen, C., Ojomo, E., and Dillon, K., 2019. The prosperity paradox, Harper Business.
3. Carayannis, E., Samara, E. And Bakouros, Yannis, 2015. Innovation and management- Theory, policy and practice: Innovation, technology, and knowledge management, Switzerland, Springer. 
4. Christensen, C. 2003. The Innovator’s Solution, Harvard Business Review Press, Harvard.
5. Christensen, C., Ojomo, E., and Dillon, K., 2019. The prosperity paradox, Harper Business.
6. Carayannis, E., Samara, E. And Bakouros, Yannis, 2015. Innovation and management- Theory, policy and practice: Innovation, technology, and knowledge management, Switzerland, Springer.