A Deeper Dive into the 4 Types of Innovation: Basic Research

Basic research is one of the four innovation models developed by Greg Sattell and the innovation quadrant. Alongside basic research, sustaining innovation, breakthrough innovation and disruptive innovation are the three other essential forms of innovation vital to business development.

In this article we will be explaining in more detail what basic research, in relation to innovation strategy, actually means. We will cover what it is, why it is important and why understanding it is essential to your future career.

What is basic research?

There is a lot of evidence to show the importance of innovation as a driver of long-term economic growth in a national and international market. Innovation by an individual company can produce spill-over knowledge which benefits other companies as well as society in general. Each company has a limited innovation capacity driven by various factors related to their size, profitability, and market position, therefore not all companies are in a position to carry out scientific research. However, basic research projects do not only benefit singular companies’ needs and are often unable to be patented for exclusive use, private sector businesses are less inclined to fund this type of research and development. 

Basic research is the term used to refer to the deep, extensive investigation, and collecting data that leads to discovery of a new phenomenon, in turn enabling new problem-solving techniques. Basic research is not limited, or even specific to private sector business. The term most often refers to research that aims to increase the basic knowledge base, and improve the understanding of a phenomena. This type of research does not seek to produce results that have specific application towards a singular product or process. This research instead seeks to understand new perspectives and fuel new ideas. Essentially, basic research is research in aid of knowing more about the world we live in.

How does basic research occur?

As there is often a lack of desire for private sector corporations to conduct basic research it is carried out through federal, university and non-profit sectors. However, some policies including tax incentives for research and development, and research grants can encourage individual private sector corporations to collaborate or fund a form of basic research. Venture capital and private equity firms can both be incentivized to fund basic research that advances general knowledge and helps to develop theories, which in turn transfers knowledge from an academic institute to private economy.

Multinational companies such as Procter and Gamble, and IBM have specialized research arms of their businesses, often funding laboratories built to use a range of research methods including basic research. However, it is not only the biggest fishes in the pond that have access to this form of innovation, many small and medium sized companies also have access to basic research methods, through lesser known pathways. Federal government departments fund a range of programs, such as manufacturing hubs that are essential in making technological breakthroughs using basic research projects.

What is the difference between basic and applied research?

If basic research does not have set outcomes or interests in mind when it is carried out, applied research is its opposite. Applied research seeks to solve a specific problem or address a practical concern. It looks to encompass real life application of natural science. Applied research is much more specific therefore this kind of scientific research yields results are applicable to particular circumstances. That makes this kind of research very useful as a tool to problem solve, but less likely to achieve a discovery of a previously unknown phenomena.

Whereas basic research is used to develop theories and focuses on advancing basic knowledge to achieve, one day, a complete understanding of a scientific phenomenon or idea. It has less real-world application in its initial form, however basic research can go on to fuel applied research, that does lead to more innovation and material improvements to our lives.

In reality, many researchers use both research methods. As a global society we also require both kinds of research to be carried out by experts who are seeking to both add to the knowledge base, and solve key questions relating to human life, in order to successfully innovate both in and outside of business industries.

Why is basic research important?

Every product and service that arrives to market has seen multiple iterations before its release, after all nothing is ever perfect on its first try. As explained above, basic research is the precursor to new innovations reaching the market. It is an essential part of development of scientific knowledge, and when utilized by private sector companies, can produce groundbreaking results for both the company and the market.

Basic research does not often have a specific focus, it is instead in pursuit of a new discovery that has the potential to become a global phenomenon, collecting data on a new scientific theory or adds scientific research to the understanding of an already existing phenomena. Therefore, the possibilities of new technological and scientific advantages are truly endless, which can be an exciting prospect for private sector business.

We know this type of research isn’t exclusive to business and doesn’t only benefit private industry. Basic research in relation to business industries is often in collaboration with scientists who are completing research that may have economic potential but are not employed to be focused on financial gain for a specific company or business. Their findings and analysis may lead to critical advancement that could improve the economy, however their efforts are not only for that purpose.

What are the differences between basic research and breakthrough innovation?

Basic research often comes before breakthrough innovation in the timeline of a business’ research and development. Breakthrough innovation often requires basic research to have been established, producing useful information in a chosen phenomenon that can be utilized in a new innovative product or service. Basic research is carried out by scientific experts and can be in collaboration or funded by a business such as Procter and Gamble or Tesla. However, as previously explained it is not an innovation technique exclusive to private sector industry and does not only benefit businesses. Its aim is to produce further knowledge for all of society.

Breakthrough innovation likely uses previously carried out basic research, perhaps even funded by a private or federal pathway. However, this stage of innovation is worked on in-house by the private sector company looking to create a new product and/ or service. At this stage of research and development it is likely that workers would be building on the basic research previously achieved and looking towards applied research as the next step towards breakthrough innovation. This type of work will occur within a company’s research and development department.

How can I gain experience in basic research?

Small to medium sized businesses are often overlooked as hubs of basic research innovation, however they do sometimes partner with local universities. Therefore, completing your MBA at a university with an established research lab or faculty group, can be a valuable resource during, and after graduation.

More generally, an MBA program is an excellent place to develop a well-rounded skill set including innovation and strategy, before taking a leap into the industry of your choice. More and more top tier employers are looking for graduates from MBA programs to join their teams. The MBA programs offer a supportive environment that encourages students to develop entrepreneurial spirit, inquisitive points of view and soft skills such as networking.

Three USA based schools offering excellent MBA programs with a focus on innovation are:

• The Wharton School, University of Pennsylvania
• Harvard Business School
• Booth School of Business, University of Chicago

IESE Business school in Barcelona, is one of the best ranked MBA programs in Europe. Its focus on innovation and basic research is highlighted in the second year entrepreneurship course where, after developing new business plans, students are offered the opportunity to present them to investors, and potentially receive seed money for the project. Saïd Business School at Oxford University is another excellent choice in the UK for an MBA program building truly global leaders.

Elsewhere in Europe, The Copenhagen Business School offers multiple specializations in its MBA program including entrepreneurship or Digitalization. The business school uses traditional Scandinavian values and teaches its students a Scandinavian leadership approach to business that may provide international students with an interesting and alternative point of view.

In Shanghai, the China Europe International Business School (CEIBS), offers an English language MBA program for international students. The University of Hong Kong also offers an intensive one year full time MBA program which has three major business city specific tracks for its students including the London track and New York track. These specific tracks determine where a student will spend 4 months of their program, combining knowledge from their Hong Kong experience with another international city.

Now you have understood disruptive innovation, you can explore other forms of innovation here, or take a look at our program finder to see what MBA options are available to you, no matter what part of the world you'd like to study in.