Disruptive innovation vs. continuous improvement

Disruptive innovation is a term that is being heard more and more often on company boards and management committees. Organizational leaders aspire to it without often being clear about what it is and how to achieve it. In this article we explain what disruptive innovation is and how it differs from continuous improvement.

What is disruptive innovation?

There are many definitions of disruptive innovation. From the study and our experience, disruptive innovation is a type of innovation that radically changes a market or industry, creating a new way of doing things that is better and more accessible to consumers.

7 disruptive innovations

Throughout history, there have not been too many disruptive innovations. Some of the most significant are:

• Fire. Used by humans for thousands of years to cook food, heat spaces, illuminate areas and protect against dangerous animals.
• The wheel. Fundamental for the development of agriculture, commerce, transportation and the existence of many machines.
• Writing. It has allowed the transmission of ideas and knowledge from generation to generation.
• The printing press. It has made possible the reproduction of texts and graphics and the massive dissemination of information and knowledge.
• The steam engine. It has facilitated the automation of a large number of production processes and has transformed the way energy is produced and transported.
• Electricity. It has enabled a host of technologies and transformed the way we live and work.
• Internet. It has radically changed the way we communicate, access information and trade.

Is it possible for organizations to achieve disruptive innovations?

Although many managers use this term in their communications, disruptive innovations are not easy to achieve. All of the aforementioned disruptions were culminated by someone. However, it cannot be considered a solitary work, but rather the cumulative process of small steps taken by one and others that culminate in a concrete achievement. Thus, for example, the Internet was not the innovation of the well-known Vint Cerf, but was based on the work and conclusions of Paul Baran, who in turn was based on the work of Kleinrock, and so we could continue. Not to mention the icing on the cake that Tim Berners-Lee put with the HTML language that facilitated the exchange of information and the creation of what we now call web pages.

How is disruptive innovation different from continuous improvement?

There are several ways to classify innovation. If we focus on the impact they have, we could categorize it as follows:

• Disruptive innovation: creates new industries and markets.
• Radical innovation: create new business models.
• Incremental innovation: modifies existing business models.
• Continuous improvement: improving the efficiency, usability and, therefore, user experience of existing products or services.

Know the difference between continuous improvement and innovation

If we take this structure into account, we can view innovation as a double-entry learning ladder. On the one hand, we have the attitude and, on the other hand, we have the experience and the results. It is a matter of putting into practice the expression that almost every manager knows, but that very few apply: "think big, act small". In this sense, if we take "big" thinking and fragment it, we are likely to get different options for radical innovations, which in turn we will fragment to obtain possible smaller innovations, which we could label as incremental. And if each of these possible innovations, labeled as incremental because of their impact, risk and difficulty characteristics, were to be broken down again into very small steps that bring us closer to that "big" thought, we would obtain continuous improvements, since they do not change much of the initial product or service, but they improve it enough to generate greater customer or user satisfaction. Therefore, from our point of view, continuous improvement is innovation. If, for example, we continuously improve the weight, ergonomics, simplicity, etc. of a product, we will modify it little by little until, after a while, if we compare the original product with the current one, we will observe the enormous transformation we have achieved.

How to innovate in a company?

Innovation is not magic, it is focus, perseverance and learning. The first step to innovate in the business environment is to know the details of the culture of your organization (or rather, the differences between the different cultures that exist in any organization), to identify where the accelerators and brakes are that allow you to stimulate curiosity, imagination, creativity and experimentation within your company, essential skills to generate innovation. Knowing the details of our culture in the face of the challenge of innovation is not easy, because there are not so many tools specialized in these two concepts together. InnoQuotient is a unique tool for diagnosing the innovation culture of organizations, based on a solid and robust model, developed by two Babson College academics, statistically validated by the Massachusetts Institute of Technology (MIT) and published in MIT Sloan in 2013.