In the current global economy, innovation is a key factor for a company to survive and grow on the long run. However, few research has looked into the proper application of innovation strategies. In this paper, I propose a 2 by 2 theoretical framework in how to apply the concept of incremental innovations and drastic innovations given good or flawed business fundamentals. This paper aims to demonstrate the theoretical frame by a series of extensive case study discussion of Lego. The case study examples range from consumer responses to new products to organizational changes. This paper contributes to the literatures by building on innovation theories and discussing the application of innovation strategies in a generalized way. This paper contributes to managerial insights by outlining a generalized innovation application framework for managers' day-to-day decision making.