What it comes down to is being able to picture a completely new way of seeing or doing something. The VCR is a good example. It was a totally new type of device. It was not an improved version of anything already in existence. The February 20th issue of the Economist magazine included a major examination of innovation.
Disruption is an important characteristic of innovation.
As would be expected, it causes losses in its path of making gains, creating the dynamism emblematic of healthy economies. The same article also describes the distinction between innovation and improvements. Important as they are, steady improvements to a company's product range do not conquer new markets. Nor do they guarantee survival. In fact, the disruption caused by an innovation can often bring down a leading manufacturer or even a whole industry.