There are two types of innovations which are discussed below:

(i)    Technical Innovation. It is concerned with innovations in the processes by which production takes place and also with innovation in the products themselves. It is also called pure innovation. It is creation of something radically different from existing technologies or product. An innovation may have no competitors as its birth, thereby giving a monopoly to the individuals who hold the legal rights to the invention. New inventions can create new products thereby new industries. Generally, technical innovation also treated as product oriented innovation which involves developing good and services hat incorporate entirely new and novel breakthrough advances. Over the product life cycle, large organization units develop to exploit these products and markets as they mature.

(ii)    Non-Technical Innovation. It is concerned with finding innovative missions, styles of management, growth strategies, management systems, and organizational structures. It si also treated as process innovation. It is incremental and evolutionary. Its purpose is to make existing processes more efficient. It involves small changes in design, product formulation and manufacturing, materials and service delivery that firm make to keep their product up to date and their costs down. IT also involves making improvements to existing products and other organizational processes.

In the words of Peter F. Drucker, “Innovation is the specific tool of entrappers, the means by which they exploit changes as an opportunity for a different business or a different service. It is capable of being presented as a discipline, capable of being learned and practiced, Entrepreneurs need to search purposefully for the sources of innovation, the changes and their symptoms that indicate opportunities for successful innovation. And they need to known and apply the principles of successful innovation.”

Systematic innovation involves monitoring the following sources for innovative opportunity as given below:

(i)    The unexpected success, the unexpected failure, the unexpected outside event.
(ii)    The incongruity between reality as it actually is and reality as it is assumed to be or as it ought to be.
(iii)    Innovation in industry structure or market structure that catches everyone unaware.
(iv)    Demographic (related with changes in populations).
(v)    Changes in perception mood and meaning.
(vi)    New knowledge, both scientific and non-scientific.

The first three lie within the enterprise and are often visible to people. The remaining three involve changes outside the enterprise.

Innovations result form conscious, deliberate and purposeful search for new opportunities. These innovations are specific, clear and designed applications of products targeted at creation of new customers and new markets. In the changing business scenario the slogan is ‘Innovate or Perish’. Companies cannot survive and thrive unless they continuously innovate products keeping in mind changing consumers requirements. Entrepreneurs, have to keep track of changing trends and innovate for both survival and growth.

For more help in Types of Innovation click the button below to submit your homework assignment