Any machine has a hierarchy of principles of operation. Consider, for example, thermo machines. Their topmost principle of operation is converting a portion of the heat flow from source to sink into mechanical work. Below it lies a more specific principle of operation: convert the heat flow into thermo expansion of some medium and then convert this expansion into mechanical work. Below it lies even more specific pricniples of operation: use steam as such a medium, or use a gas as such a medium, or use a fluid as such a medium. If steam is selected then the principle operation has to be further specified so that to indicate how steam is generated and how its expansion is harnessed to perform a work. For example, steam expansion can be converted into mechanical work with the help of a piston, or with the help of a reaction force (as was the case in a Hero engine), or with the help of a turbine (if steam expansion is converted into steam flow), etc.
In this way we can build the tree of principles of operation for any specific machine, or for a class of machines. For example, the common principle of operation that distinguishes Necomen steam engines from other steam engines is this (in a nutshell):
Eventually improvements at the lower levels of the tree of detalization of the principles of operation exhausted its potential. The performance of machines of Necomen type stagnated and could not keep pace with the increased demand from industry. Then Watt came about and offered an improvement at a much higher level of the tree of the detalization of the principles of operation. He started a new branch of the tree dangling from a higher node. These were Watt's steam engines, which met demands of the industry. All subsequent improvements to his machine happened at the nodes well below where he started the new branch.
It has to be noted that adding new branches is not the only change that may happen to the tree. Another one is splitting a node in two. The thing is that no portion of the tree is ever complete. Some traits common to all previous machines constituting a subtree below a certain node may not be realized until a machine, which does not have such a trait, appears. When such a common trait is realized the node under which the subtree of all previous machines of the class was dangling, gets split in two, and the subtree gets relocated to one of the new nodes. The other new node is used to hung from it the new machine, which helped realize the common trait of all previous machines.
If improvement of a machine stagnates, then the principle of operation has to be changed at a much higher node in the tree than it was done before. It does not mean that such a revolutionary change in the principle of operation has to wait until improvement of the machines of a certain class stagnates. Revolutionary change can happen at any time . But if improvement stagnates there is no way forward other than change the principle of operation at a much higher node.