As businesses evolve, innovation becomes increasingly important for companies to survive. The new paradigm is, "The fast eat the slow." When examining the magnitude of an innovation you can use the following chart to categorize the innovation.
- Improve the core business - Take something that works and add a new wrinkle to it (e.g., add a clock.)
- Develop new capabilities - Find a new way to do something within an existing marketplace.
- Exploit strategic advantage - Extend a competitive advantage into a new market (e.g., Nintendo extended their video game systems into the portable video game system market with the Gameboy. Nintendo can no longer claim the top position in the console market however they have the vast majority of the portable market.)
- Create revolutionary change - Create a new capability for your company and use it to fundamentally change how your company operates and behaves (e.g., The introduction of the Apple Ipod and Itunes. Think of how these two products have changed Apple's business model.)
Some articles of interest for those who like innovation are: