By Ma Shuping, research team on “Invigorating Vitality of Innovation Entities”, Enterprise Research Institute, DRC

Research report No.170, 2016 (Total 5053) 2016-12-12

Abstract: Based on the present resources and users, the technology of incremental innovation is constantly updated, while mutant innovation will bring about much uncertainties and risks to enterprises’ original productive resources or the changes of major users. Incremental innovation attaches more importance to internal resources, having less destruction on enterprise development and industrial pattern and being beneficial to the long-term development of current enterprises. It is the major innovative method in traditional industries. On the contrary, mutant innovation lays stress on external resources, having the ability of overturning industrial structure. By doing so, enterprises are likely to experience explosive growth, especially in those emerging industries with rapid technological progress. The different approaches adopted by various countries toward incremental and mutant innovations are closely related to their national innovation system and enterprise characteristics. Japan leads the world in incremental innovation, which has played a significant role in the industrial development and economic restructuring in Japan. Japan’s experience makes good reference to Chinese enterprises. China’s innovation has a relatively weak foundation, and we should attach more importance to incremental innovation. It is suggested that the government should further improve innovation policy, encourage enterprises to constantly make incremental innovations so as to realize quantitative-based qualitative changes and enhance the country’s overall innovation strength.

Key words: incremental innovation, mutant innovation, policy, Japanese experience