Product development and innovation are critical to business. They are what drive new markets, new customers and new revenue opportunities. They are what add strength to your portfolio of products and services. In this issue of Promotional Consultant Today, we kick off a series examining the three types of innovation, as explained by innovation expert Jake Nielsen, and how ideas within these categories can contribute to the overall strategy of your company. Today, we begin with Breakthrough Innovation.

Breakthrough innovation is what most people think of when they think of innovation—something new, bold and way ahead of the next best thing. Additionally, a breakthrough product often combines the functionality of several different products all into one. For example, when the iPhone came out, its simplicity, beauty, computing power, functionality and ease of use put every other phone on the market to shame. This type of innovation represented a big step forward in performance, technology and value to the end user.

These breakthrough developments are very difficult to achieve for startups and even quite hard for big, established companies to create for several reasons:

Lack of resources. Startups especially struggle with this. If you have a breakthrough idea, you may be able to secure venture capital funding so long as the market and business case warrants it.

Lack of laser-like focus necessary to achieve a breakthrough. Large companies can often struggle to maintain an intense focus on perfecting a new idea. One of Steve Jobs' best quotes is that focus is about saying no to 1,000 things. That's the kind of focus that's required to achieve a breakthrough.

Lack of a detailed understanding of the end user. Without a sufficient understanding of users' needs, new product ideas can become a grueling exercise in trial and error. Understand exactly what the job to be done is and build out your idea to ensure it gets the job done better than the next best solution.

Lack of required technical competencies. Even with vast resources, some projects will fail due to a lack of the core competencies needed in order to execute the project. Do whatever it takes to learn or acquire the skills necessary to execute on the idea.

Breakthrough innovations are usually along the lines of high-benefit dramatic impact to the bottom line. If your company is built around the strategy for which you generally charge a premium to your customers, then breakthrough innovations are vital to your success. If you charge a premium, you'll need to deliver premium value and breakthrough innovations are perfectly suited for this strategy.

Ready to learn more about innovation? Read PCT again tomorrow.

Source: Jake Nielsen is the founder of TheInnovativeManager.com, which includes the tools and trade secrets great innovators, entrepreneurs and thought leaders have used throughout history to change the world. He is also a contributor to Innovation Excellence, an online home of the global innovation community, building upon a rapidly growing network with thousands of members from over 175 countries.