Yet with high risks come potentially high returns. To make radical innovation happen, we need to be clear exactly what it is – and importantly what it is not. Simply put, incremental innovation entails improvements within a given frame of solutions (“doing better what we already do”), whereas radical innovation requires a change of frame (“doing what we did not do before”). We can further break down the distinctions between incremental and radical innovation as follows:
MAKE RADICAL INNOVATION HAPPEN| Incremental Innovation | Radical Innovation |
|---|
| Exploits existing technology | Explores new technologies |
| Low uncertainty | Entails high uncertainty |
| Focuses on cost or feature improvements in existing products or services, processes, marketing or business models | Focuses on processes, products or services with unprecedented performance features |
| Improves competitiveness within current markets or industries | Creates a dramatic change that transforms existing markets or industries, or creates new ones |
It’s also important to distinguish radical from disruptive innovation. Disruptive innovation usually requires a new business model that challenges or disrupts other companies – but not necessarily a technological breakthrough. For example, Apple started to give its Mac OS X operating system away for free, whereas Microsoft had been used to commanding expensive license fees (up until Windows 10). Radical innovation, however, tends to focus on new technological breakthroughs only. Architectural innovation, the most challenging for competitors to imitate, combines technological and business model disruptions.
Sources: Pisano (2015) You Need an Innovation Strategy, HBR, June; Australian Institute of Commercialisation (2012) Innovation Can Be Incremental or Radical, Innovation Toolbox, Queensland Government; Norman, D. and Verganti, R. (2012) Incremental and Radical Innovation: Design Research Versus Technology and Meaning Change, Design Issues, 30(1), pp. 78-96.
Action Point
Discuss with your managers exactly what radical innovation looks like – and create a clear definition or set of criteria that people agree on. Look for examples of where you are currently pursuing radical innovation in comparison to your competitors.