Companies are most likely to succeed when undertaking innovation from positions of existing strength – willing to take risks and try new things even when they are highly successful, and have found ways to encourage innovation among high performing employees who would otherwise be content to play it safe. This often means building a culture and incentive system where experimentation and even failure are tolerated and encouraged. Firms like Apple and Google have been successful at innovating, while at the top, and are still eagerly path-breaking. According to the Harvard Business Review:
Organizations tend to perform better when they have strong capabilities—better scientists and engineers, effective product development processes, and strong brand names—and these advantages are not only likely to persist over time, they are also likely to be helpful even when pursuing more radical inventions. The better you understand the possibilities and limits of the old technology, the better chance you have of combining it with more distant knowledge to develop something really new.