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Types of innovation

Turning challenges into opportunities

Reading time: 10 min

What types of innovation are there?

When we speak about different types of innovation, there are several ways of grouping them: according to their technological push, their nature, their application, etc. Delve into some of the most important types here.

When we talk about innovation, we are referring to the creation or modification of a product and its introduction onto the market. From the invention of the wheel to the latest advances in medicine or technology, innovation goes hand in hand with the growth of civilizations.

If we take this concept to the business world, innovation has the aim of evolving to provide effective solutions and improve the quality of life of customers and society in general. Therefore, the application of innovation can give one an advantage over competition. It is currently more necessary than ever, as we live in a changing world where it is essential to constantly adapt to new environments and the urgent demands of consumers.  

In this regard, the classification of innovation is important when it comes to strategy and process, as it determines where the organization is innovating (in the business model, in the final product, in the manufacturing process, etc.). To delve deeper into this concept, let's have a look at the main types of innovation that exist. The Oslo Manual on innovation explains the different types of innovation. This guide orients the scientific and technological activities that are considered innovative and classifies them according to their objective and degree of change. 

Types of innovation according to their technology push

Innovation can be classified, for example, by their technology push. In other words, these are innovations that result from new technologies for which new possibilities are sought and applied. 

Recycling Pictogram

Open innovation

It represents a new strategy in which companies cooperate with other agents of society, such as institutions or other professionals, and pursue the best talent to seek new formulas that convert challenges into opportunities.

Recycling Pictogram

Closed innovation

Innovation is carried out exclusively using the company's internal R+D resources and processes. In this case, external sources of information are allowed to be consulted during a certain stage of the process, and then work is done 'behind closed doors'.

In open innovation, corporations make the most of synergies generated amongst employees and external knowledge of the market, whereas in closed innovation, other agents from society, such as suppliers or consumers, aren't taken into account. This has been the traditional way of managing innovation projects for many years. 

Types of innovation according to their nature or sector

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Sustainable innovation

The aim of sustainable innovation is to create a positive impact on the environment and society through the use and application of technology. This can help develop more sustainable cities.

For example, climate change is one of the main challenges we currently face and one that we must solve with the application of sustainable innovations in fields such as the circular economy. 

a doctor gives medicine to a girl

Social innovation

Social innovation refers to a series of ideas that effectively resolve a social situation and which establishes new relationships. Furthermore, said solutions must be replicable, scalable, and maintained in the long term. 

An example of social innovation could be increasing the capacity of health centers to be able to attend all patients, which has a positive impact on society, or reducing the digital divide, training the population on new technologies.

a robotic arm, example of technological innovation

Technological innovation

Technological innovation occurs when we obtain a product or service from new processes or supply sources. This can happen for three reasons: thanks to technological development, because of a combination of different technologies, or through the use of knowledge acquired while researching the creation of the product. 

The different types of renewable energy sources are an example of this type of innovation. The use of new technologies have allowed us to anticipate energy fluctuations.

graphene, a good example of innovation in materials

Innovation in materials and constructive systems

Innovation in materials solves problems that arise with the use of certain processes, methods, and even from the application of other materials. 

A clear example of this type of innovation is graphene, a new, light, and highly resistant material, which has potential ambitious applications in the technological, health, and environmental sectors. 

Types of innovation according to their application

More types of innovation, classified by their application, include:

  • Product innovation: new products are introduced onto the market that will mark trends in a specific sector. The application of this type of innovation may take place throughout the entire life cycle of an existing product or a completely new one may be created. For example, the material of an object can be modified so that it is much more resistant. 
  • Logistics innovation: this type of innovation occurs when an entire process is replaced or a significant change is introduced in an already existing one for the supply of services and delivery of products. It is very common to see these innovations in the so-called industry 4.0, where a software upgrade allows the same tasks to be carried out in much less time. 
  • Organizational innovation: it is an innovation that applies new, agile methodologies with the aim of promoting the competitive advantage of the company. In the corporate world, there are many innovations of this type, such as schedule flexibility, management of talent and the value chain, and the development of human resources, among many others.
  • Marketing innovation: it is based on achieving a significant improvement regarding positioning, segmentation, commercialization, distribution, or any stage of the sales process of a product or service, through the launch of new techniques, strategies, or tactics. We see this class of innovation very often, for example, when the packaging of a product is changed so that it is more striking and more units are sold. 

 

Types of innovation according to the degree of change

To finish, if we speak about innovations according to their degree of change, there are three types: radical, incremental, and disruptive.

Detail of asphalt bitumens

Radical innovation

Radical innovation is based on the creation of a totally different value proposal for a product or service, implying a break with the established method up to now.

Modified bitumens

Incremental innovation

Part of a product that already exists, but that incorporates very significant improvements. In other words, additional value is generated.

Betunes modificados

Disruptive innovation

Disruptive innovation is the application of new ideas that lead to the modification of products, services, and processes, generating drastic changes in the market, companies, and the behavior of consumers. This is usually a scalable movement that reaches many people at the same time.

An example of radical innovation is computers, which thanks to their innovative writing software displaced the typewriter, resulting in virtually every household having a computer. On the contrary, in the case of smartphones and their tactile screens, we can talk about incremental innovation. The product hasn't been modified, it is still a cellphone, but a considerable improvement has been introduced that has completely modified its use.

How to apply these innovations?

The application of any innovation within a group depends to a large extent on its staging. Our work must focus on showing employees, customers, and partners why the innovation is new, how it works, and why it is the best way forward.

Once we have reached that point, we must identify which innovations work best in our company, always aware of possible adaptations and evolutions within each innovation.