The three levels of innovations are as follows; I will also add an example:
- Incremental Innovation. This is when a company improves upon an already existing product or service. For example, when Apple computer comes out with a new device, which is faster, smaller and lighter.
- Breakthrough Innovation. This is when the change in product or service is something beyond that of an incremental innovation. Customers will see this product or service as something new. I would say the introduction of the iphone by Apple can be seen as an example of a breakthrough innovation.
- Transformational Innovation. This is the greatest innovation and it usually creates a new industry. Often times it even makes older technologies obsolete. The introduction of the personal computer would be an example of this.
Can a company survive based on continual innovation? This is hard to say. I think it is possible, but it will be hard. For example, when Steve Jobs passed away, people were afraid that Apple Computer will lose its creative and innovative edge. Under the leadership of Jobs, Apple has truly led the way with innovation. Innovating is hard work, but then the human mind is creative. From this perspective, I am hopeful. As long as a company is willing and able to draw the best talent, it can continually innovate.