Lecture line Industry Trends Week 3:

Slide 1:
The existence of diverse meanings for innovation is a significant consideration for assessing a company's
innovation maturity. The recognition that there are various sorts of innovation, each of which should be
treated differently. Because we can all agree that innovation can no longer be considered a catch-all
phrase.
Innovation can be classified in a variety of ways, some of which are more or less overlapping. The goal of
this article is to help you understand different approaches to innovation and how they relate to the big
picture.
It is critical to characterize innovation so that it does not become a catch-all phrase. In some cases,
categorizing aids in making the best decisions or taking the best actions. An Innovation Matrix can help
in this situation.

Slide 2:
An Innovation Matrix is a graphic representation of how to quickly discover several types of
innovation based on whatever aim is required for a particular perspective. Because different causes exist
for identifying different sorts of inventions, multiple matrices exist to define these various types of
innovation.
An Innovation Matrix can be used from different perspectives and elements to categorize on:
1. To determine the origin of innovation.
2. To determine the strategic relevance
3. To determine what governance system to use.

Different viewpoints identify different sorts of innovation for different reasons. One is the ability to
seek a variety of options. Another requirement is the ability to develop a well-balanced portfolio and an
innovative approach. The ability to manage innovation is a third reason.

Slide 3:
INCREMENTAL INNOVATION
Incremental innovation is a type of innovation that involves modifying or changing current products and
services with the primary purpose of improving functionality and lowering costs. The majority of
innovations in the existing market are incremental, slow, and continual enhancements to existing
concepts, products, or services.
The majority of innovations are incremental, modest, and consistent improvements to existing
ideas, products, or services in the market. In one way or another, almost every company engages in
incremental innovation.

Steady advancements are only marginally better than the prior version of the product or service,
and they deviate only slightly from the current item plan or administration delivery method.

Items can be made smaller, easier to use, or more appealing without losing their core functionality, and
services can be made increasingly proficient through continuous development.

Slide 4:
INCREMENTAL INNOVATION
It also refers to the changes that occur on a daily basis (marginal improvements in products or
optimizations in production processes). They grow on a “firm foundation” (already existing products or
processes).
Customer benefit optimization, cost reduction, repositioning, adaptation for introduction into new
markets, or adaptation to new circumstances such as new laws and standards are the goals and benefits.
Incremental innovation is critical because it allows a company to stay competitive and maintain market
share. Even better, bringing incremental breakthroughs to market ahead of the competition tends to
increase your market position.

Slide 5:
INCREMENTAL INNOVATION
Example:
Within its existing product line, Sony has a strong reputation for incremental innovation. Between
1980 and 1990, they created a total of 160 different Walkman models, ensuring that they were always at
the cutting edge of technology. The market never saw Sony as a laggard because they were never one —
there was always a newer and better product on the market (one hundred sixty versions works out to a
new Walkman every twenty-five days). Sony was able to preserve its market dominance and reputation
for product leadership as a result of this.

Slide 6:
INCREMENTAL INNOVATION
Example:
Another corporation that relies on incremental innovation is Toyota. Because of an emphasis on
incremental improvements in manufacturing and assembly, they are the world's most efficient
automobile manufacturer. Because of its effectiveness, their Kaisan technique is now being imitated and
adopted by firms all over the world. Kaisan or Kaizen is a method in which personnel at all levels of a
company collaborate proactively to enhance the manufacturing process on a regular basis. In a way, it
brings together a company's collective talents to form a powerful engine for growth.

Slide 7:
RADICAL INNOVATION
Radical innovation is a business concept that aims to fully demolish and replace an existing
industry, or to develop an entirely new one. It transforms an existing system, design, or invention into
something entirely new. It may alter the system's components, processes, or both. These are new
products, services, or procedures that require a lot of change and creativity. As a result, the impact is
higher - new markets, for example, can be developed as a result.
When a company implements emerging innovations to a new market, this is referred to as
"applying new technology to a new market." When a new product, technique, or service with significant
technological advancement has a large market impact and fully replaces an existing offering, this is
referred to as disruptive innovation. This is a long-term process of invention.

Slide 7:
RADICAL INNOVATION
The big questions are answered by radical innovation. It provides people with both what they
require and what they did not realize they required. Radical inventions alter markets and, in some cases,
the entire economy.
 Radical innovations are uncommon, but they are all around us, and more are appearing all the
time. The computer and the internet are just two examples of radical innovation that have altered the
way the world functions.

On your screen are the 3 levels of radical innovation.

Breakthrough inventions solve difficult problems in novel ways and/or significantly improve
customer value over existing offerings.
Individual breakthrough thinkers or research and development laboratories are usually the
source of such inventions, which are the outcome of strategic creativity and experimentation (R&D).
Breakthrough inventions result in significant technological advancements, allowing a company,
product, or service to leapfrog competition.

A proactive disruptive innovation is one that brings to market a considerably different value
proposition than previously available, generates a new market and value network, and eventually
disrupts an existing market and value network, displacing established leaders.

Markets, society, and the nature of competition are all transformed by game-changing innovation.
Game changers create new product categories and produce innovations that have a significant
impact on how people view the world, think, and act.
Visionaries and opportunity seekers are enthralled by such developments.

Slide 8:
RADICAL INNOVATION
Example:
Radical technological advancements, such as the personal computer and the internet, have
revolutionized the way the entire globe runs and communicates. These disruptive breakthroughs create a
foundation for our civilization to build upon, resulting in dramatically accelerated economic growth.

Slide 9:
Difference of Incremental and Radical Innovation
Slide 10:
DISRUPTIVE INNOVATION
Clayton Christensen created the phrase "disruptive innovation" to describe the process by which a
product or service takes root in basic applications at the bottom of a market and then aggressively rises
up market, replacing established competitors.

Disruptive innovation is a notion that describes a concept, product, or service that creates a new value
network by either entering an existing market or creating a new market.

Disruptive innovation is the process of transforming expensive or highly sophisticated products or

services that were previously only available to a high-end or more skilled part of the population into
products or services that are more affordable and accessible to a wider audience.

However, the fact that established firms are fully reasonable when making judgments about their
present company makes disruptive innovation difficult. They are unable to adapt to new competitors
because they are too focused on improving the existing offering or business model that has shown to be
effective in the market thus far.

As a result, rather than a champion, a new competitor disrupts the market.

Because the existing market is frequently larger and the margins are better, this phenomenon
known as the Innovator's Dilemma is actually fairly reasonable.

Slide 11:
DISRUPTIVE INNOVATION
Example 1
Netflix is a classic example of disruptive innovation, as it disrupted an existing market with a new
business model and technology. It began with a DVD-by-mail rental business before launching a
subscription-based online movie streaming service. Over 150 million individuals around the world utilize
its on-demand all-you-can-watch movie program.

Slide 12:
DISRUPTIVE INNOVATION
Example 2
Airbnb, Inc. is an American company that operates an online marketplace for lodging, primarily
homestays for vacation rentals, and tourism activities. Based in San Francisco, California, the platform is
accessible via website and mobile app.
Airbnb has taken the holiday accommodation sector by storm when it first opened its doors five
years ago. Private homeowners utilize its cloud-based platform to list and collect payments for their
rooms and residences, with smartphone apps and social integrations all lubricating the wheels of the
Airbnb engine.

Slide 13:
SUSTAINING INNOVATION
 Sustaining innovation is the practice of improving existing products and services for current
customers, either in response to consumer or market demands. Sustaining innovation isn't about
targeting unexplored or underserved markets; it's about staying relevant and competitive.
It is comparable to incremental innovation in that it refers to the improvement of something that
already exists. Current clients and their requirements are the emphasis of this form of innovation.
In comparison to disruptive innovation, sustaining innovation seeks to improve existing products
and processes. It does not create new markets, but rather develops existing ones with better value.

Slide 14:
SUSTAINING INNOVATION
Example:
The smartphone market is an example of sustaining innovation: every year, mobile phone
manufacturers (such as Apple, Samsung, Huawei, Amazon, LG, and others) introduce updated and
improved devices to fulfill consumer demand and include new technologies. Maintaining open lines of
communication and feedback allows organizations to improve and give more value to customers and the
market.

Slide 15:
Difference of Disruptive and Sustaining Innovation