discontinuous innovation during periods of ferment emerges from entrepreneurial, skunk-works types of organizations. These units are relatively small, have loose, decentralized product structures, experimental cultures, loose work processes, strong entrepreneurial and technical competencies, and relatively young and heterogeneous employees. Entrepreneurial units build new experience bases and knowledge systems; they generate the experiments, the failures, the variation from which the senior team can make bets on possible dominant designs and/or technological discontinuities. In contrast to the larger, more mature units, these small entrepreneurial units are inefficient, rarely profitable, and have no established histories. They often deliberately violate the norms valued in older parts of the organization.

From Winning Through Innovation: A Practical Guide to Leading Organizational Change and Renewal