In this highly
competitive and fast paced economy, businesses fight to be dominating world
markets. The business environment in today’s world is experiencing significant
changes such as increase in competition, advancement of technology and
increasing globalization. This in turn reflects market opportunities for
development to business firms. Market development refers to a type of business
strategy by which a business tries to expand to new groups of buyers for its
existing products, meaning to expand to untapped markets. Moreover, what can be
held from this is that in order to survive in this ever-changing economy, and essentially a key factor,
is the concept of innovation. The notion of innovation can be interpreted and
executed in many different ways. With the main four types of innovation being
incremental, disruptive, architectural and radical, firms can implement one of
these types as a business strategy in order to enhance their competitiveness in
the market. Taking Japan as a compatible example shows how innovation can
develop an economy into one that is now highly developed and market orientated,
accommodating some of the worlds leading industries such as motor vehicles and
electronic equipment to just name two. Japans economic outlook has been very
interesting and has experienced spectacular growth in three different periods,
in particular post the defeat of World War 2 in 1945 when the island nation
rose to become one of the worlds largest economy. Currently Japan is amongst
the leading innovation countries, as well as being the world’s third largest


Innovation is a
key term, which is the basis of the point to be expanded in this essay, being
that of the use of innovation within Japanese firms. A plethora of definitions for innovation types has resulted
in an ambiguity in the way the terms ‘innovation’ and ‘innovativeness’ are
operationalized and utilized in the new product development literature. The
terms radical, really new, incremental and discontinuous are used ubiquitously
to identify innovations (Garcia, R, Calantone, R, 2002:110). With the concept of innovation already
highlighted the main type of innovation that will be focused is radical
innovation. Amongst the two opposing types of innovation namely radical and
incremental innovation, there is a crucial factor distinguishing them. To start
with, innovation involves introducing a new concept towards existing products
or services to make them better. Innovation
is “the process of translating an idea or invention into a good or service that
creates value or for which customers will pay” (,
2014). Creativity can overlap
with innovation where creativity is the idea, innovation is the process to
implement the idea into real product or service, both of which are import to


The two main types
of innovation that businesses adopt is radical and incremental innovation. Despite
the fact that companies may choose to adopt both types of innovation, incremental
innovation is the more popular style chosen, given the low risk compared to
radical innovation. Incremental innovation is a less extreme measure because it
implicates the method of progressive developments of innovation that happen
gradually over time. Incremental innovation can be thought
of as cost cutting or feature improvements in existing products or
services (Leifer, 2000). Businesses tend to utilize incremental innovation
methods to stay ahead of their competitors and so they do this by enhancing and
improving their range of established products and services. From the point of
view of a business, it is necessary in the efforts to secure their success.

Implementing an innovative culture is a rewarding strategy a manager can apply.

by itself incremental innovation is never enough to assure the long-term
success of an organization (Morris, 2006).  The reason for this is due to
the fact that incremental innovation only advances existing products and does
not create a new product or effect a drastic change.


Some companies don’t just innovate
their products and services, they take it a step farther and fully innovate
business models within an industry. 


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