ABSTRACT

Ever since Joseph Schumpeter, Rosabeth Moss Kanter and, more recently, Clayton Christenson amongst others, incremental innovation has been contrasted with radical innovation. The ‘innovator’s dilemma’ faced by big companies is that in order to produce breakthrough innovations you must replace a good revenue earner – that is, in essence, you must break before you construct, which is a risky option. This means that the only way you can create a world-beating product is by making what seems like a bad bet. However, the dilemma is that if you do nothing, it’s more than likely that someone else will do it for you, which explains in a nutshell why big companies often purchase smaller rivals.