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We present a model that explains how established firms create breakthrough inventions. We identify three organizational pathologies that inhibit breakthrough inventions: the familiarity trap – favoring the familiar; the maturity trap – favoring the mature; and the propinquity trap – favoring search for solutions near to existing solutions. We argue that by experimenting with novel (i.e., technologies in which the firm lacks prior experience), emerging (technologies that are recent or newly developed in the industry), and pioneering (technologies that do not build on any existing technologies) technologies firms can overcome these traps and create breakthrough inventions. Empirical evidence from the chemicals industry supports our model. Copyright © 2001 John Wiley & Sons, Ltd.