Risks

The big risk is not being open to innovation and not being willing to pursue it. If you don't do it, someone else will.

Companies also need to understand the risks that come with disruptive innovation:

• There is the financial risk that an innovation won't pay back.
  
• An innovation could backfire and damage a company.
  
• There is the risk of having someone too high up in the company involved; they tell employees what they think should happen, and the team becomes intimidated.
  
• Managing the innovation process could become so overwhelming that it eats up your budget and the project is shut down prematurely.
  
• An innovation that fails creates a risk for managers; they could end up with reduced influence within the company or even lose their jobs.
  

Opportunities

Companies that develop the capacity for disruptive innovation can benefit in many ways -- in the marketplace and internally.

• Companies that are first with big innovations become market leaders and can drive their category for a very long time.
  
• They can insulate themselves from competition; they create barriers to entry that make it very difficult for anyone else to come in.
  
• They can attract the best talent; everyone wants to work for Google.
  
• They energize and motivate their employees; there is a halo effect for the entire company.
  
• Successful innovation increases the value of the company and can generate significant financial rewards for executives and employees.
  
• Companies can get a lot of positive press; that happened to Johnson & Johnson – no one ever thought they would do something as innovative as KY Intimacy.