Merriam – Webster describes innovation as “the introduction of something new”. However, this explanation is very vague as the term is tightly connected to the market. From a company’s point of view simply “introducing something new” isn’t innovative.

Innovation has to be producible at an economically viable price and has to satisfy a certain customer need. It’s the implementation of a better solution for an existing problem.

Truly useful ideas don’t arise from out of nowhere or through techniques like brainstorming or divergent thinking.

The best ideas come in response to an important problem and thrive under constraints.

People usually think that an invention is the same as innovation, however similar they might be they are not the same.

Innovations are mainly the better use for an invention, or at least, an improved version of the same invention that will meaningfully impact the market and society.

There is a great risk that goes along with innovation because organizations that make revolutionary products or technologies simultaneously create new markets.

It’s not as simple as saying some companies are innovative and some are not. Companies often have a marketing strategy with which they navigate their decisions.

But having only one strategy and never trying anything else is a recipe for failure in a constantly changing market.

If innovation is about solving problems then there would have to be as many solutions as there are problems. Thinking that one algorithm can solve all problems is dumbfounded. There is no one way to innovate.

In a way, people need to be innovative about how they innovate.


In reality, the answer is simple – to stay relevant. No one can or should expect that their product will be on the market forever.

When it comes to competitive technological fields like phones, computers, software… innovation is crucial for survival.

Every year the company’s make new and improved products that challenge all of their other competitors. If they didn’t, everyone would forget they ever existed.

However, in the case of company’s that provide simple services or products staying relevant might just mean making a website.

A bakery doesn’t need to change their food year-by-year to stay relevant, their only worry is that the food is good and worth the price.

Of course, in the long run, everything changes. Keeping up with the shifts in the value network of your market is important. You don’t want to find out that your product isn’t worth the price by going bankrupt.


There are many different ways that innovation can be categorized. These categories may overlap because of the aforementioned large variety of problems people can innovate on.

Categorization is still necessary to further organize a company’s innovation methods and help utilize the advancements of their product, services, concepts, etc…

Mapping out the changes you make to the product and how it affects the market is key to innovating with actual productivity.

One way to differentiate between innovation is based on 2 spectrums: the product it sells and the market it sells in.


Most innovations are incremental, slow and constant enhancements of the current ideas, products or services in the current market. Almost all companies engage in incremental innovations in one form or another.

Steady advancements are only somewhat superior to the previous version of the product or service and have just a slight departure from a current item plan or administration conveyance technique.

Items can be made smaller, simpler to utilize or increasingly alluring without changing their center and usefulness and services can be made progressively proficient through steady improvement.

Albeit gradual advancement doesn’t make new markets and often doesn’t use fundamentally new innovation, it can pull in more lucrative clients since it satisfies the client’s needs recognized from their conduct or input.

The product or service may likewise speak to a bigger, mainstream market in case you’re fit for giving similar functionalities and value at a lower cost.

This scenario can be very well explained with the example of the TV. There are new models being brought out all the time with the core value still intact, only changing some characteristics and specifications.

The mainstream clients can for an affordable price get an 50” LED TV while the demanding clients will pay a lot more for a 75” OLED TV.

What’s very helpful about incremental innovation is that most of the time it’s much simpler to sell just a slightly altered product since you don’t have to clarify how it works. People already know how it works, the selling point is that is is a better product.

A potential drawback is that gradual improvements don’t really have an immense effect since they’re usually just marginally superior to anything already out there.

There’s a danger of over-complicating your products and including an excessive number of highlights nobody needs or wants to pay for.

So you shouldn’t overlook the clients who need a basic, easy to use and cheap product.

Except if you explicitly decide to focus on all the more requesting client section and to give them premium products.

Another hazard tied to incremental innovation is that the market may (and will) change sooner or later as a result of disruption (a different innovation strategy that will be explained later on).

In the event of such a situation, depending on simply steady advancement won’t be sufficient enough to keep up with the changes.

Therefore, it’s essential to concentrate on all the while improving the center business while additionally searching for better approaches to make an incentive via creating a new business model and working on disruptive innovations.


Disruptive innovation induces chaos into the market by introducing an innovation that changes the already set values of an existing market or by creating a completely new one. It will eventually cut out the market-leading firms, products, and alliances.

The term was first introduced and analyzed by a professor, academic and business advisor Clayton M. Christensen in 1995 with his book The Innovator’s Dilemma.

Disruptive innovations are usually made by entrepreneurs and startups. The business network doesn’t let market-leading companies pursue disruptive innovations because, at first, they aren’t profitable enough.

First and foremost, disruptive innovation has a large drawback when it comes to having the product actually selling.

It’s a big risk of creating a new market because you will never know how the customers are going to react until it’s already out there. Disruptive innovation is a high risk – high reward strategy.

In the event that traditional innovation strategies fail disruptive innovation comes in to play to make a new market for the traditional strategies to flourish.

Organizations can sometimes be too inside the box. They will be too occupied with what is going on with their business to see that another competitor already has moved in.

The worst-case scenario is that the competition is a total game-changer.

The value network of the market tilts, and suddenly your product is of no more worth anymore.

However, this isn’t always the situation, at least not in the short term.

That is a problem connected to revolutionary products and radical innovation (another type of innovation that will be explained later on)

Companies should keep an open eye for new competition. Chances are that your product will remain relative in the big scheme of things if you’re a competitor on the top of the hierarchy.

Blockbuster movie companies have taken a blow because of company’s like Netflix for instance, but they are still nowhere close to being pushed out of the market.

The middleman in these situations is the biggest victim. For example, digitalization has wiped out tons of company’s by replacing manual jobs with simple software.

People think that disruptive innovation happens abruptly but in reality, it’s usually a slow takeover like with the appearance of the SaaS business model. When these kinds of company’s first appeared nobody suspected that they will become a large part of the modern market, interesting enough they are the standard now.

Therefore, instead of simply focusing on your past success in servicing the most profitable market category, you should also concentrate on modifying your business model to discover new profit centers that may not even appear attractive yet but may have significant growth potential in the near future.


Sustaining innovation is the polar opposite of disruptive innovation. It’s founded on incremental innovation and customer needs. It exists in the market and it helps it grow, it sustains it.

Disruptive innovation has large problems with profitability, sustaining innovation strategies has large problems with staying relevant in a changing market. Disruptive products after being introduced into the market thrive on sustaining innovation.

A good example of a product that was revolutionary in its’ time and is still fully supported by the market with fierce competition in the smartphone.

But new versions do not create any new networks, they cater to the same customer needs as they did years ago. Despite the lack of innovation their profits and market are still expanding.

The key is making the product more appealing to the clients. It’s not just about developing and advancing the product, all of those changes need to have a purpose.

Continuously making a product bigger and better, more efficient, it’s to attract a higher paying client section in need of better equipment.

On the other hand, a product might be too expensive for the market. It can’t fill the void because the price doesn’t match the need for it.

Then the problem is finding a way to sustain its place in the market. A better product, in that situation, could be a cheaper more accessible item that can be sold in larger volumes.

Again, depending on the product it might be better to develop its usefulness so the customers have a reason to pay for it. For this reason, it’s important to address the market.

The keyword is “reason”. Why do people need your product? What is the selling point? What is the “reason” they are buying it, or, aren’t buying it? This is where incremental innovation starts to bring in more and more profit.

Sentiment monitoring is an effective system for collecting data. Looking back at how customers reacted to your products or collecting information over social media can be a big help.

Social media can is a great way to collect data because most people won’t bother to call customer service to share their poor or good experience with the product. However, social media gives a less direct way of communicating with clients.

Not only does getting a better picture of what your clients want to make incremental innovation more purposeful, but it also gives you a view of your role in the market.

Knowing what your company stands for in competition can serve as a good guide in business plan advancements.

Another point on why sustaining innovation and disruptive innovation are polar opposites is well explained at the end of the quote

. Large companies will always go with sustaining strategies because it’s an easy payoff. New startups will have a much better chance of being disruptive because they will be outclassed by the firmly established competitor.


The first thing people usually think about when they hear the word “innovation is what is called radical innovation.

It closely coincides with disruptive innovation, however, the difference is in the fact that radical innovation uses both revolutionary technology and a new marketing plan.

Radical innovation answers the big questions. It brings people what they need and what they didn’t even know they needed. Radical innovations change the market and can even change the whole economy.

Radical innovations are rare, but actually, they are all around us and more and more of them keep showing up. The computer and the internet are just some examples of radical innovation that has changed the world and the way it works.

Radical innovations, like the internet, create even more markets upon which people can innovate.

The first car was a radical innovation but it didn’t alter any other market except transport and travel. Comparisons like these are needed just to show on how large a scale the world can be changed by radical innovation.

Considering the very nature of radical innovation can determine how long it will take to integrate it into the market.

There is a fresh, much bigger surge of revolutionary developments that they find to be on the brink of becoming common.

These are robots, artificial intelligence, blockchain technology, conservation of resources, and decoding of genomes.

According to their study, the biggest period of change like this has been the beginning of the 20th century, when television, internet, and automobiles were gradually embraced by culture, and they expect that this one will be a greater order of magnitude.

For most companies it’s the same as it is with disruptive innovation. Either you notice it prepare for the value network shift in the mark, or you don’t and end up being swallowed by the tide.

In essence, the company needs to adopt an approach called the ambidextrous organization. That means that they need to ensure the competitiveness of their current business while simultaneously preparing for the future.

Saving up money with incremental strategies will buy time for a big innovation that will give hopefully enough backbone to stay relevant in the market.


Reading this is just the first step in figuring out what your innovation strategy is and when you should change it.

Individuals need to continue to view engineering as other market practices— as a set of tools designed to achieve specific goals.

Just as we wouldn’t focus on a particular marketing tactic or a single source of funding for an organization’s entire life, we need to build a portfolio of product approaches for specific tasks.

To keep your business going without any problems you should assess different parts of the market and your company. In simple steps:

  • Analyze the state of your company
  • Prioritize the places that should be strengthened
  • Split your business goals into smaller, easily implemented bits
  • Commit to the method

Your approach depends on your product or service, and even more on your goal.

If you want to improve your company you need to monitor and analyze your process. Once you have identified the problem on which you should innovate you need to make a plan on how you will remove the obstacles from your path.

This may mean changing your organization system or implementing new technology. Sometimes it may mean changing the direction your company has been going for years.

It’s important that you move fast, you can’t lose time doing nothing to help your company, especially if it is’ failing. Still, you need to know what you’re getting in to. You don’t want to bite off more than you can chew.

A carelessly thought out move could mean the end for your company. Maybe not right away, but setting off in a bad direction could make it impossible to ever get back on track.

If you’re already in the game, keep on growing your business and look out for changes in the market. For better or for worse they will happen.

The 4 Types of Innovation and the Problems They Solve

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