Bansi Nagji and Geoff Tuff in their HBR Article Managing Your Innovation Portfolio say that innovation portfolio should look at a 2 X2 matrix defined by the core of the organization and market it caters to. The further you are going from the core and the market, the more investment you need in the innovation, more strategy you need in the intended innovation.
I think this is an interesting way to know your current innovation portfolio, and also to plan one for the coming years. It classifies innovations as Core, Adjacent & Transformational depending on how far they are from your existing core and existing markets. Each of these will need a different strategy to manage and each of them will give a different kind of return. You can do incremental innovations in your core, some brave ones in adjacent but real radical ones will be in transformational.
The classification may tell you to see these three as mutually exclusive but they are absolutely not. At any point in time an organization must work on all three of them simultaneously to extract the most of its core and to be able to expand its core. While the first category drives efficiencies and productivities the last one helps create paradigm shifts.
So check how are you doing on these three categories and where you need to focus your energies on?