Innovation in process and technology are crucial elements in the product lifecycle, especially to a company’s long-term relevancy and success in its industry. However, innovators are often challenged by their company’s mandate to focus investment on products and services that address current markets and customer demands. While achieving and sustaining financial performance is necessary for short-term survivability and maintaining shareholder value, innovators need to also consider long term strategic planning and outlooks. To begin the transformation from reactionary to visionary, innovators need to be able to differentiate between sustaining innovation and disruptive innovation.
Sustaining innovation involves identifying and developing existing or emerging technology/process that address specific problems for current products and markets and is typically focused on the short term. Disruptive innovation attempts to solve emerging user needs that current products/technology/process cannot solve. Disruptive innovation typically has a longer outlook and potentially competes with existing products and services.
While sustaining innovation is similar to planning the next evolution of a product line, the primary difference between sustaining innovation and creating product roadmaps is the deliberate focus on creating intellectual property (IP) that enhance upcoming products or even accelerate the development of pipelined products. The sustaining IP at minimum provides competitive advantage or addresses competitive threats.
Let’s take a software gaming company developing the next revision of its popular RPG game as an example. While a sample roadmap could include developing its game on the major personal computer and mobile operation systems, an example of a sustaining innovation might be to create APIs to allow third party developers to develop customized versions of the company’s games on their platform of choice.
Disruptive innovation, on the other hand, seeks to predict future market and evolving user behaviors based on future trends and technology. To continue using the software gaming company as an example, a disruptive innovation project could be to develop easy to use customizable gaming modules to allow anyone to develop their own ad-hoc games. While this may seem to potentially cannibalize the company’s existing revenue generating products, this disruptive innovation allows continued loyalty to the company’s brand, allow different revenue sources (monetization on modules, licensing etc) and preempts competition.
Preparing innovation roadmaps is undoubtedly important for a company to continue to remain relevant in its industry. Innovation allows the company to dedicate resources on critical intellectual components that are outside immediate product requirements but have greater potential impact on the future. Distinguishing sustaining and disruptive innovation will further assist in assessing innovation needs.