Optimize, Innovate, Disrupt: How They Differ, and Why It Matters
All too often, “innovation” is used as a catchphrase for three completely different activities: innovation, optimization, and disruption. While they all require creating something new, the market conditions and potential downsides vary, so make sure you understand what the situation calls for.
Optimization vs. Innovation vs. Disruption
- Innovation introduces new ideas and emerging technology into an existing category. This is what everyone thinks about when they talk about creating new things: they jump on the most cutting-edge technology or coolest trend and apply it to their brand. If you want to innovate, your company has to have a keenly developed sensing team — one that’s always exploring how new ideas and technology can be applied.
- Optimization adds incremental improvements to an existing product or service. This isn’t nearly as “sexy” as innovation, but it’s crucial for extending the life of a brand and generating revenue. To succeed at optimization, you have to be absolutely obsessed with your customer and service design — every step of the purchase process has to be that much better.
- Disruption creates new business models in order to reach new customer segments. Complacent competitors and unserved segments mean it’s time to find a new way of doing business. More than anything, this requires courage — a willingness to challenge the status quo, even if (and especially if) it threatens your company’s existing business model.
How to Recognize the Need to Optimize, Innovate, or Disrupt
- Optimize if you've identified an existing consumer need that’s just not being met by current options. Be careful, as it can be hard to know when to stop supporting an existing product and try something else.
- Disrupt when you’ve identified an entire new customer segment that’s being underserved. This can take a long time to develop, though, so make sure you’re financially able to wait it out.
- Innovate if you’re noticing a new technological development or cultural trend. But don’t get caught up in the hype: be clear if you’re innovating as a stunt or as a scalable product.
Takeaway: Make sure you're using the right approach for your market conditions. If you need a reminder, download our Optimize Innovate Disrupt chart.