The Three Stages of Disruptive Innovation: Idea Generation, Incubation, and Scaling

Facing imminent disruption, many large, established firms have embraced innovation as a way to develop new growth businesses. To succeed in the face of disruptive change requires established firms to master three distinct disciplines: ideation, to generate potential new business ideas; incubation, to validate these ideas in the market; and scaling, to reallocate the assets and capabilities needed to grow the new business. This article illustrates how two successful firms (Amazon and IBM) have developed approaches that address all three disciplines.