Geoffrey Moore writes: "As my colleagues and I developed our model for Return on Innovation, we saw three sources of attractive returns. They are: 1. Differentiation leading to sustainable competitive advantage. The return comes from customers preferring your offer over the competitor’s (more revenues) and paying a premium for it (higher margins). 2. Neutralization of a competitor’s current competitive advantage. The return comes from being able to compete in more sales opportunities than you previously could (leading to incrementally more revenues, but not better margins). 3. Productivity leading to better overall profit margins. The return does not come from any change in competitive advantage but rather from your ability to accomplish the same outcomes with fewer resources. ..." Link: Dealing with Darwin.