Organizations who are effective at tapping the entire spectrum of innovation are able to tap into their own ‘native genius’—whether that be great engineering and products, like Toyota’s Prius, or distribution and processes, like FedEx—while partnering with other firms, tapping into major cultural trends or getting into deeper relationships with their customers. Gone is the age when a company can be effective simply by being the best at one thing—digitization of the world means that no one approach to innovation is good enough to be competitive for long, and long-stable industries are being disrupted by companies like Google or Apple who have begun to master the art of integrating their digital skillsets with established players’ unique value to create nearly impossible-to-beat offerings.

Most traditional concepts of innovation are remarkably narrow in view. At first glance, smartphones seemed to be about the hardware. But the genius is that Apple and Google accessed nearly every element available to them—from strategic partnerships with music companies, new distribution channels for their products, new business models for tech devices to highly-integrated customer service systems. By accessing the entire spectrum of resources available to them, they changed not just their product, but effectively jumpstarted a new industry—and left their competitors to play catchup.

It’s not just tech companies who are tapping into this full spectrum of value to create next-generation digital businesses, though. Airlines, manufacturing, basic consumer products, apparel companies and even governments are letting go of long-held assumptions about what they can and cannot do to ensure they survive rising costs and increasingly-high customer expectations of quality and engagement.

Culture change is a critical part of innovation. Key shifts in the way we relate to the concept of the individual and community are shaping everything from business to government. Examples of this kind of cultural innovation include the Occupy movement, which reframed the individual’s relationship to increasing government regulation.

Social media is changing our cultures by providing a tool for people to update each other and spread new ideas globally in a matter of clicks. Most of us have experienced big shifts in our day to day life because of the transparency of social media. Globalization, meanwhile, is creating so-called ‘hyperdiverse’ cities, where the compelling draw of urbanization brings a rich soup of innovative potential together—but also forces intense questions about class, privilege and sustainability.

Meanwhile, digital natives—the children and young adults who grew up with pervasive access to knowledge and global communication tools—challenge our fundamental conceptions of what it is to be human. Do we have to be connected to the web? How will we keep up with (and make a good future for) our children?

Government and legal innovations are a critical part of making new value possible. And without the right legal frameworks balancing the needs of the commons and the capacity for new innovations, business and public progress can come to a standstill.

Examples of governmental and legal innovation includes regulatory policy (such as legislation supporting responsible driverless car testing). Recent challenges in the US around net neutrality, for another example, pitted major telecom and media corporations against the ‘little guy’ in innovative web startups and social organizing. Focusing on the desire of companies to selectively upgrade (or downgrade) bandwidth access to particular sites and traffic types, a fierce argument erupted amongst internet service providers and other technology stakeholders, chief among them companies like Google, Comcast and Netflix, about what was best for both the commons and business. In such an environment, specialized lobbyists and trade groups, like Engine Advocacy, served to organize companies’ common interests and translate complex legal issues. They also attended to key copyright law changes in the SOPA and PIPA legislative proposals, helping various parties understand the long-term, perhaps unintended consequences of such legislation.

Business model and platform innovation is one of the key moves in the disruptive startup playbook—and a huge challenge to entrenched ways of doing business. Where traditional business strategy focused on creating a solid product, new business strategy is increasingly focusing on creation of platforms—especially an exponentially-valuable form of platform called a multi-sided platform.

In short, the multi-sided platform is perhaps best modeled by the expansion of Apple’s shiny, well-designed iPhone (and iPad) to the entire platform which supports them (iTunes, iCloud, the iTunes Music Store) and then, the broader App Store, CarPlay, Apple Pay and developer/accessory ecosystems which make the iPhone and iPad what they are today.

• Find out more about Software as a Services (SaaS) and Platform as a Service (PaaS) for another example of business model & platform-based innovations.

From the time of trade ships and expeditions to flea markets and bazaars, innovation has always paid attention to expanding or creating new markets. The best innovators question whether they are in the right markets or can create new ones at the same time that they consider which platforms and products they’ll be creating. Markets ignored by traditional players have become fertile ground for new innovations by disruptive players.

For example, Dell tapped into under-met need for mail-order, custom computers. Tapping into their expertise across much of the innovation spectrum, using fierce price pressure and integrated customer service, manufacturing and distribution systems, Michael Dell went from a $1,000 startup to a global leader setting the bar for e-commerce and other systems. Pushback around quality for bottom-price internal components and customer service made Dell a prime example of the challenge of aggressive combinations of new markets, pricing and distribution systems.  

Innovation in distribution has had incredible impact in the consumer goods market, especially enabled by platform-thinking and the Internet’s endless opportunities for personalized shopping.

Amazon is an obvious leader in this area of innovation, offering competitive pricing, consistent shipping policy, and other benefits to their customers while streamlining their own shipping and fulfillment processes through creation of a multi-sided platform and an innovative play which blends warehouse and wholesaler benefits with direct-to-consumer user experience.

Apple also created a unique opportunity for their brand with their boutique retail stores and highly-trained staff, after realizing that their products couldn’t communicate their intended value as presented on retail shelves at big electronics stores. In the past decade, Apple has successfully upgraded their brand’s image from a technical one which was favored mostly by design professionals to an image which seems to walk the line between usability and luxury. Most of this transformation was accomplished through careful curation of the Apple Store experience, a distribution and fulfillment play that has shown enormous benefits for the brand.

New models for processes and development such as Agile and Lean provide an environment in which individuals are empowered to make changes and efficiently launch improvements without the “Waterfall Effect” of previous project management techniques. Agile also avoids costly innovations which are based on ungrounded value propositions by attaching a specific user experience goal—a “story”—to each change, keeping the rapid-cycling process grounded in its ultimate purpose of improving usability and value.

Product and offering innovations are those shiny new devices you see on the shelf. Innovation efforts used to be (or often still are) focused on these kinds of innovations, like Sony’s Walkman, Mars’ Snickers bar (launched in 1930!) or Toyota’s Prius. While all of them required distribution channels, marketing and other support, such innovations are primarily about the product itself. For example, the Prius did not require substantial changes in consumer behavior and only moderate changes in dealer and manufacturing systems (retooling, yes, but not a total change in business models).

Product and offering innovations are sometimes too easy to focus on—‘if we have the best product, customers will choose to buy from us’—because they are tangible, relatively easy to understand and genuinely can provide considerable, obvious value. But today, it is rare that a product or offering innovation on its own is enough to stay competitive for long.

Innovations in relationship and community often involve creating and maintaining a sort of gravity between customers, employees, products, subcultures and/or locales. Notable examples of innovators in this area are Nordstrom and Zappos, both of whom are perhaps most famous for their return policies. Nordstroms actually has no official return policy, which may seem foolhardy to those who predict loss of profit from too many return scams—when in reality this “no questions asked” policy has had customers feel more confident paying for high-end items knowing that the store will stand behind product quality and values customer happiness enough to take some risks. It’s so well-known that is has spawned urban legends about people successfully returning automobile tires to the clothier—which has never sold tires—as a fable of the value of doing nearly anything to satisfy a customer.

Another innovation in community that Nordstrom’s shares with Zappo’s is the empowerment of employees at all levels to make decisions which can improve customer experience—a choice in corporate culture which reverberates both internally and externally as valuing people over profit. With the addition of sophisticated communications, customer service and event strategies (personal shoppers, significant and buzz-worthy yearly or seasonal sales, etc.) these two companies have proven that investing in customer and employee happiness and empowerment is a risk that can really pay off.

Meanwhile, companies like Starbucks have elevated a relating to their customers as ‘consumers’ to something more like a co-creator. As a great example, in 2008, Starbucks launched My Starbucks Idea to source concepts for its stores and products from its customers. Using a platform powered by Salesforce, they have surfaced (and implemented) huge numbers of ideas from all over the world.

Brand and experience innovation is the most apparent to the customer, and is usually the most widely recognized beyond a particular industry or culture.

Imbued with the flavor of Richard Branson’s other brands, his US airline Virgin America has reimagined routine in-flight features to make flying itself a better experience. For example, by replacing the flight attendant’s mandatory safety monologue with a witty, celebrity-studded music video and using mellow purple (rather than harsh white) ambient lighting, Virgin lent a nightclub feel to the cabin.

For online and mobile-based bank Simple, making the user experience more fun and relevant may have seemed like a stretch. After all, banking has never really been seen as an enjoyable activity, but it is a necessary one and we are all aware that it can be a bad experience. Simple has relied heavily on little data™ and empowered customer service teams to find out what customers like and don’t like about their interface and has prioritized innovations based on that customer feedback to make changes smart and quick which directly improve the user experience. For example, when Simple’s data showed them customers generally use their smartphones to check balances, rather than move money around, they adjusted the security protocol to make these “balance check” logins faster and simpler than a login for more complex account management. As a result, Simple’s customers use their smartphone app three times as much as the average mobile banking user, and have less overdrafts and balance-related complaints as well.