Sustaining innovation

Definition

Sustaining innovation refers to improvements and advancements made to existing products, services, or processes that enhance their performance or value. This type of innovation helps companies maintain their competitive edge by addressing the needs of their current customers and improving upon established technologies. It contrasts with disruptive innovation, which introduces a new market or value network that displaces existing market leaders.

5 Must Know Facts For Your Next Test

1. Sustaining innovation often targets established customers who are looking for improved versions of existing products rather than entirely new offerings.
2. Companies can engage in sustaining innovation through enhancements in technology, features, design, and quality, which can lead to higher customer satisfaction.
3. This type of innovation plays a crucial role in ensuring long-term profitability and market leadership for firms that effectively implement it.
4. Sustaining innovations can occur in both high-tech industries and traditional sectors, often reflecting shifts in consumer preferences and advancements in technology.
5. While sustaining innovation strengthens existing market positions, it may also lead companies to overlook disruptive innovations that could eventually threaten their dominance.

Review Questions

• How does sustaining innovation differ from disruptive innovation in terms of target markets and customer needs?
  • Sustaining innovation focuses on improving existing products to meet the needs of current customers, enhancing their experience with better performance or features. In contrast, disruptive innovation seeks to create new markets by appealing to overlooked segments or offering simpler and cheaper alternatives. This means that sustaining innovation reinforces a company's position within its established market, while disruptive innovation can fundamentally change market dynamics and challenge industry leaders.
• What are some strategic approaches companies can use to foster sustaining innovations within their existing product lines?
  • Companies can adopt several strategic approaches to nurture sustaining innovations, including investing in research and development to enhance product features, engaging with customer feedback to identify areas for improvement, and leveraging new technologies to upgrade their offerings. Additionally, fostering a culture of continuous improvement within the organization encourages teams to seek out ways to refine existing products. These strategies ensure that companies remain competitive by consistently meeting evolving customer expectations.
• Evaluate the impact of sustaining innovation on a company's long-term success and its ability to respond to disruptive changes in the market.
  • Sustaining innovation significantly contributes to a company's long-term success by enabling it to continuously improve its products and retain its customer base. However, while focusing on sustaining innovations, companies must also remain vigilant about potential disruptive changes in the market. If they become too absorbed in enhancing existing offerings without recognizing emerging disruptive trends, they risk losing relevance as new entrants reshape the competitive landscape. Thus, a balanced approach is essential for maintaining a strong market position while being adaptable to future disruptions.

Related terms

disruptive innovation: A process by which a smaller company with fewer resources successfully challenges established businesses by offering simpler, more affordable, and accessible products or services.

incremental innovation: Small-scale improvements made to existing products or processes that enhance performance, usability, or value without drastically changing the underlying technology.

innovation strategy: A plan that outlines how an organization will develop and implement innovations to meet market demands and achieve competitive advantages.