Innovation Strategy

What is this metric used for?

The Innovation Strategy allows to understand how the Innovation is on the technology that I value.

Combining the analysis of originality and patent portfolios distribution shows the ability to innovate in a technological field and highlights the innovation cycle.

 The lower the average originality of a technological field, the more likely it is that this sector will be cluttered and mainly leaves room for incremental innovation. Usually, the innovation cycle is at an advanced stage and it's waiting for a breakthrough to start a new cycle. On the contrary, an emergent field will show a higher average originality because it is more conducive to breaking innovations and innovation cycle is at an early stage.

How the graphic is built?

1/ The first graph visually represents the way innovation is done on a technology. This can be incremental or in reverse disruptive. This qualification is done by relying on the degree of originality of the technology as defined by Hall, Jaffe, and Trajtenberg (2001)

 2/ The second graph represents in a standardized way on a gauge, the proportion of patents belonging to the top 10 applicants for a specific technology. Usually 5 levels have been defined, ranging from emerging to ending.

To go further

Innovation Process 

The qualification of the innovation process is based on the originality index, measuring the dispersion of citing patents over technology classes. The Originality index is defined as the average of the originality index calculated for each patent family (value between 0 and 1). The greater the dispersion of IPC / CPC subclasses of the cited patents, the higher the index. To get further information, please refer to the complete definition by Hall Jaffe and Trajtenberg (2001)

The patent filing strategy qualification is defined as following 

• < 0.80 Incremental
• >= 0.80 Disruptive

Incremental innovation is a series of small improvements to an existing product or product line that usually helps maintain or improve its competitive position over time. Incremental innovation is regularly used within the high technology business by companies that need to continue to improve their products to include new features increasingly desired by consumers.

According to Clayton Christensen in “The Innovator’s Dilemma,” disruptive innovation is an innovation that creates a new market and value network and eventually disrupts an existing market and value network, displacing established market-leading firms, products, and alliances.

Innovation cycle

The Innovation Cycle qualification is based on the following values: