The world keeps getting faster. The pace of innovation is speeding up.

If you don't keep up your company will be left behind and ultimately fail. But there's a solution. Part one of that solution is getting a comprehensive feel of what innovation is and that's what we go into here.

To put the increasing pace of innovation in context, in the late 19th century it took 75 years for the telephone to reach 50% of US households, whereas it took 2 months for ChatGPT to reach 100m users in 2023.
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At Mindlace, our mission is to 'accelerate innovation'. But first we need to define what innovation actually is.

In 2009, Baregheh et al. found around 60 definitions in different scientific papers for the word ‘innovation’.

With so many different meanings of innovation out there, it is increasingly difficult to make sure we remain focused on what true innovation means.

In a business landscape that’s ever-evolving, be that due to a worldwide pandemic, financial crisis or simply the increasing pace of new foundational technologies, innovation isn’t simply the route to success, it’s your lifeline. Without continuous adaptation and renewal, your business will eventually be out-competed and fail.

So whilst innovation has been an overused buzzword, it’s literally mission-critical to master it. It’s vital to the long-term success of any business.

In this blog, we will define exactly what innovation means, the different types of innovation, and how your business can move forward with the Mindlace’s approach to Innovation Strategy.

In this blog we'll…

• Define Innovation
• Outline the 10 Types of Innovation
• Go into the key categories of Innovation
• Look at Innovation in practice
• Sketch out where Mindlace come in

How to Define Innovation

‘Innovation is the systematic practice of developing and marketing breakthrough products and services for adoption by customers.’ - Mckinsey and Company

• Alternatively, a simpler but equally effective definition is: ‘Innovation is the implementation of new ideas that add value.’ This is one we love.
• So often innovation is mistaken for creativity and invention. However, the two entities differ.
• For an idea to be truly innovative, it must provide a use or a value. Ask yourself, ‘Does my idea provide a viable solution to a problem?’ If so, then you have something innovative to work with.
• Therefore, ‘Innovation is a product, service, business model, or strategy that’s both novel and useful. Innovations don’t have to be major breakthroughs in technology or new business models; they can be as simple as upgrades to a company’s customer service or features added to an existing product.’
• In other words, it is the opposite of Business As Usual (BAU), or what Michael Boyles calls ‘The Operational World’.
• Whilst - ‘The Innovative World’- encourages creativity and experimentation, BAU typically reflects an organisation’s routine processes and procedures; think the everyday running in order to stay afloat.
• It is crucial that ‘The Innovative World’ coexists with ‘The Operational World’, at all times to ensure success. Too often the strains of running a business mean that innovation falls by the wayside. However, the Mindlace Innovation strategy, led by our LAUNCH framework has a structure that works to be implemented alongside your everyday business running. Businesses shouldn’t have to choose between Innovation and Operation.
• Innovation needs to become part of your day-to-day operations.

The 10 Types of Innovation

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Doblin’s 10 types of innovation is a framework that was developed to help organisations identify new opportunities and develop desirable, feasible and viable innovations.

So, let’s break it down a bit…

Core Process Innovation 🌏

This refers to the methodologies and operations that companies use to conduct their primary activities. By innovating here, businesses can achieve operational excellence, streamline processes, and reduce costs. Think Toyota's lean manufacturing or Amazon's supply chain management.

Business Model Innovation 💼

This involves changing the way a company generates revenue or delivers value to its customers. Subscription models, freemium offerings, and platform businesses are all examples. Consider how Netflix transitioned from DVD rentals to streaming, fundamentally altering its business model.

Network and Alliance Innovation 👥

This emphasises collaborations, partnerships, and affiliations that can provide a competitive edge. Strategic alliances, joint ventures, or even co-branding can fall under this category. Apple's collaboration with IBM for enterprise solutions is a prime example.

Structure Innovation 🏗️

This relates to the organisation itself, its hierarchy, and its composition. By innovating in this space, companies can achieve unique capabilities or foster a culture of innovation. A typical structural innovation would, for example, be the move from domain-based teams to cross-functional mission-driven teams.

Product Performance Innovation 📈

This is perhaps the most recognised form of innovation, focusing on the features and functionalities of a product. From the iPhone's multi-touch interface to Tesla's electric powertrain, product performance innovations capture the limelight and drive consumer demand.

Product System Innovation 🖥️

This goes beyond individual products, focusing on creating integrated and complementary product suites. Think of how Microsoft Office's suite of products work seamlessly together or how Apple's ecosystem of devices interconnect.

Service Innovation 😅

This revolves around the support and enhancements that accompany a product or a service. By innovating in this space, businesses can differentiate themselves and enhance customer loyalty. Zappos were a great example of a company that went above and beyond to build customer happiness.

Channel Innovation 🌊

This pertains to how businesses deliver their offerings to customers. E-commerce, direct-to-consumer models, and omnichannel retailing are all manifestations of channel innovation.

Brand Innovation 👗

This is about the representation and perception of a company. Through brand innovation, businesses can resonate more deeply with their target audience and command premium pricing. Consider how luxury brands like Louis Vuitton or Gucci have cultivated an aura of exclusivity.

Customer Engagement Innovation 📱

This focuses on the touchpoints, experiences, and interactions that shape a customer's relationship with a brand. By innovating here, businesses can foster deeper connections and loyalty. Starbucks' emphasis on creating a "third place" for its customers is a classic example.

The Different Categories of Innovation

Disruptive Innovation

• This means ‘When a company with fewer resources moves upmarket and challenges an incumbent business.'
• ‘Low-End Disruption’ occurs when a company uses a low-cost business model to enter the bottom of the market and claim a segment.
• ‘New Market Disruption’ occurs when a company creates and claims a new segment in an existing market by catering to an underserved customer base.

Sustaining Innovation

• Sustaining Innovation strives to create products of higher quality, whilst Disruptive innovation aims for ‘good enough’ products to appeal to the low-end and new market segments.
• At a mature organisation, incorporating disruptive and sustaining innovation is the best bet for success. It means that the company competes at either end of its given market.

Breakthrough Innovation

• Breakthrough Innovation is the innovation that occurs when the problem you are trying to solve is well-defined, but the domain it exists in is still only operating at part of its potential.
• For example, a breakthrough innovation may occur when a new product is introduced to the market that didn’t exist before.

Radical Innovation

• This is a paradigm-shifting change that disrupts existing markets or creates new ones. This means it can often make existing products obsolete.
• It often entails significant levels of uncertainty and investment but with the potential for high rewards.

Define Innovation in Practice

• The corporate world is riddled with companies that didn’t act fast enough to pursue effective innovation strategies.
• 88% of the Fortune 500 firms that existed in 1955 no longer exist today. Either due to mergers, being bought by another company, or they simply failed to stand the test of time.
• Failure to innovate is the major downfall for companies that fail to hold longevity. However, innovations don't have to be major breakthroughs in technology or new business models; they can be as simple as upgrades to a company's customer service or new features added to an existing product.
• It’s these small tweaks in the right direction that stop businesses falling behind competitors.
• Take ‘Toys R Us’, for example. They signed a 10-year contract with Amazon to be their ‘sole’ vendor of toys on the site. However, Amazon began allowing other vendors to sell in spite of the deal. This resulted in a law case that took much of ‘Toys R Us’s’ money and attention. In the meantime, they had totally missed their chance to develop their e-commerce presence early enough. They had failed to innovate.

However, here are some examples of innovation done right…

• Netflix- perhaps one of the most well-known examples of innovation and market adaptation. Beginning as Blockbuster’s direct competitor, they soon made the jump to monthly subscriptions, followed by streaming. Thus, creating a whole new marketplace that would go on to outgrow the sphere Blockbuster was working in.
• Companies such as Uber, Apple and Airbnb continuously trigger paradigm shifts by impacting industries.

Where do Mindlace come in?

• At Mindlace our team have had decades of combined experience working with the most innovative companies in the world such as Mclaren F1 and Bumble. We have also helped challenger banks and fintechs get to launch, as well as large companies like Homebase and Unilever innovate more effectively.
• Our team also coaches startups at UCL.
• Innovation is what drives our thinking both internally, and when working with external SMEs and corporates.
• That’s why we created the LAUNCH framework in the first place. It is our map of exactly how to innovate. LAUNCH takes you from an idea or problem to solve, all the way through to a shipped and growing new product, service or venture.
• LAUNCH exists to answer to answer three simple questions as efficiently and effectively as possible. Is the idea or solution we have in mind;
• Desirable
• Feasible
• Viable
• Check our our blog on these three questions here.
• This unique process breaks down the steps any company may need to take, in order to grow and evolve through innovation strategies.
• We provide you with a case-by-case, individualised service, meaning you may use LAUNCH end-to-end, or only require one stage of the framework.

Your Next Steps

Learn from the industry experts here at Mindlace about how you can implement an innovation strategy at your organisation. Because if you don’t, your competitors will.

Get in touch with a member of the Mindlace team today, and start your innovation journey.

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