Stewart McKie

27 February 2006 www.innomate.biz

Innovation Types
There are many different views on how to classify innovation. Innomation believes that there are four types of innovation: Practice, Process, Product and Business Model. These types are defined by the answer to three questions. There are many ways of classifying innovation. For example, it’s usually agreed that classifying innovation by objective results in two types: Sustaining and Disruptive. Sustaining innovation builds on or leverages what is already in place, whereas disruptive innovation undermines or creates a discontinuity from what is already in place. Classifying innovation by impact results in two types: Operational and Strategic. Operational innovation usually having immediate tactical impact on individuals or teams and strategic innovation having deep and long term impact on whole business units or even whole organizations. Innomation believes that there are four types of innovation: Practice, Process, Product and Business Model. These types are characterized by the answers to three questions • what is being innovated? • who is being impacted? • what is causing the innovation to get done? A practice innovation changes the way that a specific task is done. It impacts individuals or individuals within specific job roles. A process innovation changes the way things are done but within a clearly defined business process context (e.g. supply chain management). It impacts individuals operating in specific process roles up to everyone involved in the process. A product/service (an intangible product) innovation changes the way that a product works/service is delivered. It may impact a wide range of both internal (i.e. employee) and external (i.e. customers/resellers/suppliers) product/ service stakeholders. A business model innovation changes the way that a business unit or organization works. It impacts everyone in, and associated with, the business. Business model innovation is done by introducing a new or changed strategy. Product/ service innovation is often done by leveraging the availability of new technology or distribution channels (e.g. the Internet). Process innovation is done by redefining and reengineering the process and practice innovation is done by introducing new tools or techniques to improve the practice. In many cases it is innomation (innovation automation) technology that determines what is doing the innovation. For example practice could be innovated when a paper-based activity is done electronically; process could be innovated when an enterprise resource planning (ERP) system is installed; products could be innovated through the introduction of collaborative design tools.

Copyright Stewart McKie, 2005. For permission to re-use/quote contact sm@tripos.biz