On the basis of innovation theory and from the services and manufacturing innovation process , this article analyzes the essence of manufacturing and service’s innovation is just for the enhancing competition. The manufacturing’s type mainly is about the technology innovation. The service innovation focuses the organization innovation. Compared with the manufacturing’s product innovation, the service’s innovation has three characteristic: intangible, replaceable and progressive. What’s more, for the manufacturing, customers don’t take part in the innovation process and play little role in the innovation. On the contrary for the service, the service innovation is customers’ need-oriented and it can help a lot with the outcome of innovation.