When the Sony Walkman was launched, it revolutionised the music industry. People thought it was the biggest breakthrough that could happen in that category; that was, of course, until Apple came up with iPod. When cell phones were launched, they literally overthrew landlines. Cell phones are a clear discontinuous departure from the landline in many ways — form, content, flexibility and pricing.
The discontinuous innovation results are what we call ‘radically new products’. They redefine the way we use the category and they invent new rules of usage and transactions.
Different processes
So how do companies go about developing these radically new products? Are the processes they adopt different from those used for smaller incremental innovations?
The answer seems to be yes. Companies look at new product development (NPD) processes for discontinuous innovations in a different way. Let us examine some of these differences.
~ Overall process : While the traditional seven-step NPD process may not be applicable to the radically new product, there is, however, some formal process involved in its development.
That is, they are not accidental or ad-hoc. The individual process is different for different new products, however. They cannot be standardised into one typical process for discontinuous innovations, either within the company or even across such innovations.
~ Innovation aspects : The difference in the two kinds of innovations — incremental versus radical — has largely to do with two aspects: technical and marketing.
The technical part of product development means arriving at specifications, developing initial samples, R&D’s iterations and the like. The marketing aspect involves taking the product for commercial sale to the end user. Both these aspects differ significantly for the two kinds of innovations.
~ Customer involvement : While the incremental innovations have a fairly heavy dosage of inputs from customers, the radical ones seem to rely more on in-house R&D teams or experts.
This is because they are more proactive in their developmental efforts and do not expect customers to have a point of view about their own latent needs.
~ NPD process methodology : Incremental innovations use more a structured, quantitative process whereas radical ones use a more exploratory process. The latter has to do a lot with dealing with unknowns from bothproduct development angle as well as from customer angle. They usually grope in the dark as to who to target, how to target, and what to offer. And these questions are best answered in the initial stages through exploratory researches.
~ New product measurement metrics : There are hardly any prior benchmarks for radically new products. Since by definition, these involve those new products that are pioneers in their categories, it is difficult to arrive at ways that could evaluate their performance from a market stand point.
So metrics are more restricted to customer acceptance at testing stages and cost and timeliness of development. However in incremental products, there are existing norms in the categories that can serve as a comparison. Therefore, it is possible to assess their performance against them.
Sector innovations
Most radical innovations take place in the technology or consumer electronics sector. This is because technology in the hands of consumer result in unpredictable outcomes that have the potential to be path-breakers. In the last decade or so, almost all the radical innovations have emanated from these categories.
To sum up, radical innovations are different from incremental ones and have to be treated accordingly. The organisation needs to be sensitive and have different processes and metrics for evaluations. The ride may be turbulent and unpredictable but the success has the potential to rewrite the future of organisations.