David O'Reilly, BAT's director of science and R&D. British American Tobacco. The buzzword du jour in boardrooms globally is "innovation," with industries from banking to pharmaceuticals forced to contend with tech-driven disruption.

Perhaps the most unlikely industry to face this grand wave of disruption is Big Tobacco — a field where the menthol once passed as innovative.

"We are becoming a tech company," British American Tobacco (BAT)'s Dr. David O’Reilly told Business Insider during a recent tour of the company's research and development (R&D) headquarters in Southampton, England.

Dr. O'Reilly is the group scientific and R&D director of BAT, the global cigarette giant known for brands like Lucky Strike, Pall Mall, Benson & Hedges, Dunhill, and Rothmans. The company sold over £14 billion-worth of tobacco products around the world last year.

But the industry is changing. Chinese pharmacist Hon Lik invented the modern day e-cigarette in 2003 and in the 14 years since vaping has come from nothing to become a small but significant — and fast-growing — corner of the market.

Now, "innovation in next-generation tobacco products is a main priority" for BAT, Dr. O'Reilly says. Like any other big business, BAT doesn't want to become this decade's Blockbuster — a once great business made redundant by the march of technology.

"These are consumer electronic products," Dr. O'Reilly said gesturing at a table of BAT's vaping products. "They have to look good as well as work really well."

Business Insider went see how BAT is trying to build its future. Here's what we found: