Yesterday I shared some of what Geoffrey Moore discussed from his book “Dealing with Darwin” during his book tour visit this week to Starbucks HQ in Seattle. Here are more nuggets from Geoff…

Geoff explained three different categories of innovation…

Product Leadership, Customer Intimacy, and Operational Excellence.

The diagram below shows which stage in the company/product/service life cycle these may appear.

I’ll share the different types of innovation Geoff outlined from the diagram.

Product Leadership

Disruptive – Create a new category, build the value chain to serve it, and ride its adoption to success. Example – Skype

Application – Take an established technology or product line into a new market where it cans serve unmet needs. – Amazon

Product – Take share in an established market with a new offer that dramatically outperforms current market leaders. – Google

Platform – Stimulate and participate in next-generation growth markets by opening up your installed base to partners. – Microsoft

Customer Intimacy

Line Extension – Gain market share by modifying a mass-market offer to appeal to an underserved market segment. Example – Nike

Enhancement – Gain margin share by creating greater perceived value at the surface of an existing offer. – Mont Blanc

Marketing – Gain customer preference through differentiated sales and communication methods. – Apple

Experiential – Gain customer preference through differentiating the experience of the offer and its delivery. – Starbucks

Operational Excellence

Value Engineering – Take market share by being first to the next price-elasticity inflection point. Example – HP

Integration – Protect and extend market share by eliminating the complexity of managing many disparate elements. – SAP

Process – Win share by leveraging productivity gains from reengineering industry-standard business practices. – Dell

Value Migration – Win margins by migrating to a new and more highly valued role in the value chain. – IBM

You may learn more on his website and by buying Geoff’s book.

Material is © 2006 TCG Advisors, LLC