The 4Ps of innovation space

Summary

The Four Ps of Innovation Space Model, created by John Bessant and Joe Tidd, categorizes innovation into four axes: Product, Process, Position, and Paradigm. Each category ranges from incremental improvements to radical changes. For instance, product innovations may include new models of cars, while radical innovations could involve electric vehicles like Tesla. The model also highlights the importance of understanding market positions and rethinking business paradigms, as seen in Grameen Bank's approach to lending. Despite some criticism regarding the subjective nature of what constitutes 'new,' the model effectively prompts organizations to evaluate their innovation strategies.

Takeaways

• 📚 The Four Ps of Innovation model, developed by John Bessant and Joe Tidd, categorizes innovation into four key areas: Product, Process, Position, and Paradigm.
• 🔄 Incremental innovation focuses on making existing products or services better, while radical innovation involves doing something entirely differently.
• 🚗 An example of product innovation includes launching a new model of a car (incremental) versus introducing electric cars like Tesla (radical).
• 📦 Process innovation can be seen in improved logistics, such as reducing delivery times (incremental), compared to bypassing stores for direct online delivery (radical).
• ✈️ Position innovation includes airlines refining service offerings for different passenger segments (incremental), while low-cost airlines like Ryanair create new market segments (radical).
• 🏦 Paradigm innovation is often the hardest to implement, involving a fundamental shift in how an organization views its business model.
• 📞 An incremental example of paradigm innovation is a bank establishing a 24/7 hotline, whereas Grameen Bank's model for lending to the poor represents radical innovation.
• ⚖️ The model emphasizes that the further one moves from established practices, the more radical the innovation becomes.
• 🔍 The model raises questions about the definition of 'new' innovation: Is it new to the company, the industry, or the world?
• ❓ Critics point out the ambiguity in distinguishing between incremental and radical innovations, noting that they can often overlap.

Q & A

What are the Four Ps of Innovation?

The Four Ps of Innovation are Product, Process, Position, and Paradigm. They help organizations evaluate the comprehensiveness of their innovation strategies.

Who developed the Four Ps of Innovation model?

The Four Ps of Innovation model was developed by John Bessant and Joe Tidd, professors from Exeter University in the United Kingdom.

What does incremental innovation mean?

Incremental innovation refers to making improvements to existing products, services, or processes, enhancing what is already known rather than introducing something entirely new.

What is radical innovation?

Radical innovation involves creating entirely new concepts or methods that significantly alter an industry or market, moving away from established practices.

Can you provide an example of product innovation?

An example of product innovation is the launch of a new model of an existing car, such as a new Toyota model (incremental), versus the introduction of electric cars by Tesla (radical).

How does the model differentiate between process innovation and position innovation?

Process innovation focuses on improving the methods of creating and delivering products (e.g., faster logistics), while position innovation involves targeting new customer segments or altering service delivery (e.g., low-cost airlines creating new market opportunities).

What challenges does paradigm innovation present?

Paradigm innovation is challenging because it requires rethinking fundamental business assumptions and self-understanding, often leading to significant shifts in the business model.

What is the criticism regarding the 'new to whom' question in the model?

The criticism revolves around the ambiguity of defining what constitutes 'new' innovation, whether it's new to the company, the industry, or completely novel across all sectors, which the model does not clarify.

How can organizations utilize the Four Ps model?

Organizations can use the Four Ps model to assess their innovation strategies, identify areas for improvement, and strategically allocate resources based on their current position in the innovation landscape.

What is the significance of understanding the continuum between incremental and radical innovation?

Understanding the continuum helps organizations find a balance between making gradual improvements and pursuing groundbreaking changes, allowing them to stay competitive in their industry.