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Introduction to the Updated Edition of Making Innovation Work

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The authors of Making Innovation Work introduce their book and explain why innovation is an integral and fundamental part of all businesses and aspects of society.
This chapter is from the book

Today more than ever, the C-suite believes the company’s growth depends on robust, sustained innovation. And the most recent economic turmoil has only underscored the importance of innovation. CEOs across Asia, Europe, and the United States agree on one thing: Success is all about growth and innovation.1

The lessons and approach to innovation that we presented in Making Innovation Work (MIW) continue to ring true today. Innovation is an integral and fundamental part of all businesses and aspects of society. It can and should be managed to produce a stream of innovations that create value for the company in several ways. First, it provides incremental improvements to existing products and services that help maintain market share and support margins. For that reason, a large part of the innovation portfolio focuses on incremental innovations. But incrementalism does not provide significant growth. For that, companies need breakthrough and radical innovations that change the rules of the game and produce the next new thing. Successful breakthroughs and radical innovations create new competitive and customer dynamics and drive significant growth. Combined in a properly balanced portfolio, incremental, breakthrough, and radical innovations permit a company to weather the toughest economic conditions, sustain existing businesses, and continue to grow. Nestlé is an example of a company in which breakthrough innovation—Nespresso—is part of an innovation portfolio that includes internal incremental innovation of existing products and that also seeks acquisitions to enter new categories and expand into different regions and distribution channels.

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