Innovating Radically Or Incrementally

Organisations often believe innovation is about doing big, transformational projects that create new revenue or define entirely new product categories. These are initiatives that are usually described by commentators as "radical" or "breakthrough" innovations. They're typified as being extremely lucrative, assuming one can afford the very substantial risks. In other words, if they succeed, you have an organisation defining hit on your hands, though the chance of this happening is relatively low.

Many executives, when asking innovators to produce, do so with the expectation that they will get radical innovation, but they want it without the risk. Most of the time, this is pretty much impossible to achieve in any reliable way, and is a reason innovation teams get fired.

Incremental innovation has none of these characteristics. It takes what is already being done in some way and improves it. The improvement needn't be especially earth shaking, and will usually have the characteristics of enhancing the market reach of a product or service, or making it possible to charge higher prices. In this respect, incremental innovation, done at scale, can add materially to the growth of a particular enterprise.

More sophisticated innovation programmes quickly work out they have to have a balance of projects in both categories if they are to be successful. The fact is, many small incremental innovations have the ability to balance the expense of having a few radical failures, something that is critical until the innovation team strikes it lucky with a big hit.

In my experience new innovation teams start by riding high on the expectation that they will deliver amazing benefits in a short time. Sooner or later, stakeholders realise the "amazing" benefits are still some time away, and, frankly, might not be so amazing after all. Wracked with disappointment, they lose interest.

Tip for new players: it is important to avoid the trap of concentrating on radical innovation at the start. By making sure most activity is incremental at the beginning, you will find your innovation programme creates basic capabilities which will become very important as your team starts doing more important work.

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