In the context of businesses, there are different types of innovation.

• Process improvement and organizational innovation: The improvement of processes through continuous improvement and the development of new solutions.
• Product development: The development of innovative products or product features.
• Service innovation: The creation and introduction of new services for customers and partners.
• Business Model Innovation: The development of innovative business models and new revenue streams.
• Digitalization and digital transformation also require companies to rethink and develop new approaches.

Many Companies Focus on Incremental Innovation

There are different degrees of innovation. The mere improvement – for example, of processes or products – is called incremental innovation. Major innovations that lead to substantial changes are called disruptive innovation or radical innovation.

Incremental innovations are, for example, the optimization of existing processes and procedures or a product line extension.

Disruptive Innovations are, for example, major innovations such as iTunes and Google Android. These are often referred to as “digital disruption”: Innovations that change the logic of existing markets.

The Difference Between Incremental and Disruptive Innovation

For many companies, innovation means taking existing products and changing details: The color, the form, the functionalities, the size, etc.

• This form of incremental innovation ensures the competitiveness of companies in existing markets.
• In future markets, incremental innovation is often no longer sufficient. Companies must radically reinvent products and services.

To ensure their long-term innovation capability, companies worldwide have established an idea management and innovation management system that provides a structured approach: From the development of an innovation strategy to setting up an innovation roadmap and successfully implementing innovation.