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That's more R&D than part of the day-to-day engineering process, though.

Anything that's going to be secret sauce is going to need a lot of prototyping and experimentation, and might not even yield usable results. Oftentimes, it isn't even possible to make an estimate as to the complexity of what it is you are building -- all you can do is timebox it.

Mixing that in with normal day-to-day development feels, to my brain, like mixing concerns.

Once those prototypes and experiments start to produce tangible benefits, then incorporating them just becomes another story in the sprint.

There are two kinds of innovations: "initial" and "incremental" innovation. What you just described is "initial" innovation (some people also call it "radical innovation"). And the process you described, I think it is called "skunk work" (prototypes and experiments) which is only one way to achieve "initial" innovation.

I think that "incremental" innovations are very important for companies and sometimes a "incremental" innovation can end up being a "radical" innovation.

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