There are many types of innovation. For example, innovation may be a new product for consumers, or it may be a new process that a company uses to produce its current products. It’s worth thinking about the different types of innovation, as the innovating company may have to develop them in different ways, and they may have different effects on the company or society when used.
This post will look at different innovation types, with examples from companies and people in the Democratic Republic of the Congo in 2018. Eight types of innovation will be discussed: product, process, position, paradigm, incremental (in contrast to radical), discontinuous, modular, and architectural. Table 1 presents the eight types and their definitions.
1. Product innovations… changes in the products provided by the company
2. Process innovations… changes in the processes used to produce a product
3. Position innovations… changes in the market position of a company
4. Paradigm innovations… changes in the way that the company thinks about its activities
5. Incremental innovations… innovations which are not very different from what they replace
(and radical innovations… innovations which are very different from what they replace)
6. Discontinuous innovations… innovations which cause substantial change in their industry’s operation
7. Modular innovations… changes in individual components that make up a product
8. Architectural innovations… changes in the links between the individual components that make up a product
Product innovations are changes in the products provided by the company. The product may be a physical good such as a computer, or a service such as medical care. An example of a product innovation is the introduction of a new energy drink by the brewing company Bralima (link).
Process innovations are changes in the processes used to produce a product. The new processes may be the result of new machinery being installed or the result of new techniques being followed. An example of process innovation is the introduction of two improved electricity generators in Kinshasa by the electricity supplier SNEL (link), which updates the machinery they use to produce electricity.
Position innovations are changes in the market position of a company. The market position includes the way the company presents itself to their consumers, and the identity of those consumers. An example of position innovation is the entry into the market for flights between Kinshasa and Johannesburg by the airline Congo Airways (link). As a result, the company started competing for customers flying between them.
Paradigm innovations are changes in the way that the company thinks about its activities. The change will often be in the type or nature of the product that the company provides. An example of paradigm innovation is the introduction of secure mobile banking by the bank UBA (link). The innovation is a change from banking services that are provided by a person in a physical location during certain hours, to banking services which are provided by a computer online at any time.
Incremental innovations are innovations which are not very different from what they replace. They contrast with radical innovations, which are very different from what they replace. An example of an incremental innovation is the introduction of a new television channel by the company Trace (link). It has new TV programs, but the basic technology and ideas are well-established. An example of a radical innovation is the introduction of a new maternity centre in Chiherano hospital in South Kivu province (link). It offers maternity services that are much better than were previously available in the region.
Discontinuous innovations are innovations which substantially change the way their industry operates. An example of discontinuous innovation is the development of renewable energy and low-carbon products by the DRC entrepreneur Gabriel Shabani (link). These products have the potential to replace products which mainly use hydrocarbon fuels, and which dominate many markets.
Modular innovations are changes in individual components that make up a product. An example of a modular innovation is the introduction of the CineBuzz cinema in Kinshasa by the entrepreneur Déo Kasongo (link). The cinema differs in its location and presentation from the Cinekin cinemas already present in Kinshasa (link), but the basic business operations are similar.
Architectural innovations are changes in the links between components that make up a product. An example of an architectural innovation is the introduction of “M-Pesa Solola na mur” by Vodacash (link). This innovation allows consumers with a bank account and a mobile phone to withdraw money from ATMs, without using a bank card. It brings together the three components (account, phone, and ATM) to create a new product.
Innovations can be more than one type. For example, we said that the new maternity centre in the Chiherano hospital (link) is an example of radical innovation. It could also be considered as product innovation (hospital maternity care is provided for the first time in the region), process innovation (the hospital has to set up the centre and prepare its operation), position innovation (the hospital will attract women who would have travelled elsewhere for maternity care), and possibly paradigm innovation (women no longer have to travel long distances, a month in advance of the birth, for care).
Innovations may also not be a clear type. For example, we said that mobile banking is a paradigm innovation, because it changes banking to an automated service accessible at any time. But it could be argued that it doesn’t really change the way people think about banking, and just gives them another means of accessing their bank services, so it isn’t really a paradigm innovation. What matters isn’t a perfect classification, but a reasonable classification that we can use to examine the innovations further.
The blog and site are written by James Waters. He is a British economist.