Discontinuous innovation

From InnovationManagementWiki

Discontinuous innovation refers to these innovations which create a major, sometimes abrupt shifts in the established structures related to the innovation. Those shifts can be related to the market, the innovating firm and its established business model or the surrounding supplier network. For instance, the shift from analogue to digital imaging was discontinuous in several ways for an incumbent firm like Kodak. The company’s competence base in terms of R&D and manufacturing had to be renewed. Moreover, Kodak was a highly vertically integrated company, taking care of everything from basic research to film finishing. With the transition to digital imaging, the benefits of being vertically integrated were rendered obsolete, maybe even counterproductive. Moreover, digital imaging was discontinuous to Kodak’s business model, which was based upon making profits on film, rather than on cameras.