Breakthrough Innovation vs. Incremental Innovation

Facing an increasingly competitive marketplace and evolving customer needs, businesses everywhere are striving to strike innovation gold. While it may feel like a challenge that has arisen only in recent times, in actuality, businesses have been plagued with this obstacle from the very beginning, but have addressed it in varying ways.

The more conservative method strives for incremental innovation, or small, gradual improvements to a product. The major advantage of this approach is that it operates within a more immediate time frame, maintaining customer loyalty and brand presence, says the Wall Street Journal.

Simpler, incremental innovation is far less glamorous and flashy when compared to breakthrough innovation, the kind that every business leader dreams of in hopes of propelling their organization to the next level and then keeping them there for years to come. While inarguably more impressive than its counterpart methodology, breakthrough innovation tends to be slower and requires larger pools of capital.

In the 1950s through the 1980s, for example, large corporate research labs were the solution to the breakthrough innovation dilemma. Xerox PARC and Bell Labs were tasked with researching, inventing, and acting as the corporate innovation department. Moving into the 1990s, venture capital-backed startups seemed to be the golden ticket.

What we’ve learned over the years, however, is that in today’s business world, “it’s no longer sufficient to invent a great new technology – in parallel you must create a great new business model,” as a recent article in Wired put it.

Nowhere is this method put to better use than within Google. Google’s own innovation incubator, Google X, “combines breakthrough new technologies with breakthrough new business models.”

So what makes Google X so successful with breakthrough innovation? According to a recent BusinessWeek article, Google co-founders Larry Page and Sergey Brin “have this idea that incremental improvements are not good enough. The standard for success is whether they can get these into the world and do audacious things.”

On the other hand, the Wall Street Journal’s Robert Plant argues that “the preferred strategy is to do both; incrementally innovate to refresh and extend your firm’s existing product range, while disrupting the industry at the same time with bold new products.”

In the end, whether you choose to go big and bold with breakthrough innovation or bank on the more sustainable incremental innovation, the key is to simply innovate. According to Wired, businesses everywhere must heed the need to innovate “so they can avoid irrelevance, bankruptcy, and oblivion.”