“TRADITIONAL” INNOVATION (Suistaining Innovation)
The innovation on which the market has been based in recent decades is
UNA SUSTAINING INNOVATION,
which serves for
SUPPORTING BUSINESS ALREADY STARTED
Which is based on an increase in product performance (based on technologies).
Paradoxically, Sustaining innovation turns out to be un-sustainable (in the medium-long term) both for those who develop it and for the Customers.
Sustaining innovation is
a Tactical Innovations,
which is used to take time.
With it we temporarily improve the situation, but we do not rely on a more general adaptation of the strategies to the requests of the new Demand (and therefore problems will emerge in the medium-long term).
In general this innovation is based on technology: the “technical” performance of the product is improved; for example we deal with the “digitalisation” of mechanical products (cars, work tools, etc.); or them become “Smart” products (like appliances), and connect them with the Internet of Things (and in the most “radical” cases the Companies integrate their products into Platforms, which increase the value of the product).
These innovative technologies – such as IoT – although they are typical elements of Disruptive Innovation, do not make the Product disruptive. As we see in the next chapter,
if you don’t change, upstream of everything,
the Business Model,
you are not able to create attractive products
for the nascent Market,
<see The failure of Hybrid innovation (Disruptive + Sustaining Innovation) >
.
There are two methods of “traditional” innovation (Sustaining Innovation):
► LINEAR product innovation (routine innovation):
In this case the products are improved by offering services that in reality are not useful to most customers (for this reason the Marketing is committed to “creating” an “image” of the product with expedients such as fiction – advertising – and styling “fantasy” – see cars with futuristic lines, or that reflect the style of “cartoons”, such as the Beetle or the Fiat 500).
The problem is, in fact, that this type of innovation today does not provide practically any useful value for the Customer (certainly not sufficient to justify the high price).
.
The fact is that the Incumbents, besides placing the focus on Styling, almost always base their strategies on Developing technologies.
The problems of the Developing technologies are, among others:
● them are, by definition, technologies yet to be developed, and therefore cannot be used immediately.
This is a big problem of Time to Market, since in the current phase of rapid evolution of the Market if one senses a need of the Demand, it is necessary to act immediately by developing a solution (with the level reached today by “low-tech” it is not necessary to wait for the mature phase of developing technologies).
● them require high investments, and therefore product prices must be very high (in a phase of the market where Customer spending is very low).
<see Why developing technologies are incompatible with disrutpive innovation>
.
The basic problem is that of over-serving: today the customers are
Over-serverved in terms of technical performance,
but they are
UNDER-SERVERD FROM THE POINT OF VIEW
OF THE QUALITIES REALLY USEFUL TO THE CUSTOMER
<see The Over-serving/Under-serving problem of the Incumbents >
► RADICAL product innovation (breakthrough innovation)
More and more often the Incumbents push themselves, in the wrong idea of developing a Disruptive Innovation, to radically innovate their offer without changing, and this is the problem, the essence of their Business.
In this wrong mode, usually not only a radical innovation of the Product is developed, but the whole range of Products is innovatively integrated so as to be able to offer the Customer an entire “system”.
But even in this case, while introducing them in their offer the characteristic of the “eco-system” typical of Disruptive innovation,
the Incumbents create
a Hybrid between the two forms
of Disruptive and Sustaining innovation
that is not at all Disrutpive innovation.
Significant is the case of John Deer who has transformed a catalog of products in their own right for farming (tractors and accessories) into an integrated system of “intelligent” elements (IoT) that has significantly increased the value of the offer.
<see the John Deer case in The failure of Hybrid innovation (Disruptive + Sustaining Innovation) >
