We often talk about how innovation occurs along a spectrum. At one end there are relatively small, incremental innovations – taking things that we currently do and figuring out how to do them better. At the other end we have disruptive innovations – those ideas that attack existing market segments in a completely new way. Somewhere even beyond that we have blue ocean type innovations – those that create entirely new markets.

In a good post that discusses disruption in slightly different terms, Jeffrey Phillips explains some of the issues with disruptive innovation:

Disruption, the most palatable, asks the firm to innovate (create new products) in a market or space that’s already competitive and where the firm often has little experience. This means the firm enters a new space, in new markets, with new products where competitors are already active. These “new” factors compound the likelihood for failure, or at least for ho-hum products.

One of the ways to create disruptive innovations is to look at an existing market in an entirely new way. This is often hard, because as Phillips outlines, this can be risky since you don’t know if your new idea will work. It is also risky because you are attacking competitors in markets in which they are already reasonably strong.

I ran across a great example of a disruptive innovation in Why the West Rules – For Now by Ian Morris. He talks about Britain’s use of the Nemesis, an all iron ship, in the opium wars in 1839.

When sailing vessels have been made out of wood for centuries, how do you come up with the idea of making them out of iron? The captain of the Nemesis explained the issue this way:

…just as the floating property of wood, without reference to its shape or fashion, rendered it the most natural material for the construction of ships, so did the sinking property or iron make it appear, at first sight, very ill adapted for a similar purpose.

Wood floats, so that’s what you make ships out of. Iron sinks, making it not so good for ships. However, iron has some major advantages in a ship. It is stronger, it draws less water, it doesn’t burn, and it is much more resistant to gun and cannon fire.

That’s a classic disruptive innovation. The British navy didn’t just come up with a better wooden ship – a race that many countries had been running for a very long time – they made a ship out of a material that you shouldn’t be able to use to make something that has to float.

What is the equivalent to wood in your industry? Something that has been used for years, that everyone takes for granted because it is obviously the best thing for the job?

If you can find an answer to that question, and devise a different, better way to do that job, you have the start of a disruptive innovation.