The contribution of innovations
The changes that result from innovations will vary in scale. ALNAP research has identified three different levels of change that can result from innovations. These do not relate to the nature of the thinking that informed the innovation, but rather the changes that come about – radical changes in how things are done might still only lead to incremental changes.
Transactional innovations might be those which are driven by needs and are often ad hoc, lowering transaction costs or enabling new forms of transactions. Because of their highly context-specific nature, there may not be scope to disseminate these innovations widely.
Incremental innovations are distinct, scalable improvements made to existing processes, improving efficiency or effectiveness. Despite being framed as ‘incremental’, such innovations can generate dramatic improvements in key performance indicators.
Transformational, or radical, innovations are long-term, strategic innovations intended to create profound transformation of organisational or industry processes, enabling and embodying new ways of working.