Disruptive innovation, a term of art coined by Clayton Christensen, describes a process by which a product or service takes root initially in simple applications at the bottom of a market and then relentlessly moves up market, eventually displacing established competitors.
Here are some of Randy Pennington‘s thoughts about that process:
Perspective matters. And, our current view of disruption is framed by the speed at which new developments in technology are making it possible to turn the status quo on its head.
Technology has always created new winners and losers as it becomes more available, dependable, and economical. The folk hero John Henry battled the steam-powered hammer in a race to lay railroad tracks. The telegraph displaced the Pony Express. Trains and automobiles eventually made stagecoach travel obsolete.
Lost in the conversation about the need for disruption are these three truths:
o There are only two times when you need to focus on disruption: (a) there are unforeseen and uncontrollable catastrophic circumstances; and (b) you have been ignoring the need to change and adapt for so long that you no longer have a choice.
o Customers don’t necessarily value disruption … and sometimes they hate it. Remember when Coca-Cola disrupted its customers by introducing the New Coke? How about when Netflix tried to split its DVD business from its streaming service? Customers want you to be faster, better, cheaper, and/or friendlier. They want you to help them avoid disruption in their lives. They don’t want to be disrupted.
o There is a difference between change and disruption. Change affects everyone. Occasionally, that change can be disruptive, but not always. There are times when you come up with a breakthrough idea, but not always. The pace of change is accelerating, and your ability to make change work can be a competitive advantage. The best organizations are always changing and adapting in pursuit of anticipating and responding the marketplace. But, they don’t buy into the notion that the only good change is a disruptive change or pursue disruption for its own sake.
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Randy Pennington is a resource for leaders who expect results and author of Make Change Work: Staying Nimble, Relevant, and Engaged in a World of Constant Change as well as a “Hall of Fame” keynote speaker. To learn more about him and his work, please click here.
I also urge you to check out the resources at Christensen’s website. Here’s a direct link.
Most of this is just nonsense, I’m afraid, Bob.
Customers DO value Disruption. They very much like it when they are no longer beholden to a self-infatuated industrial oligopoly to mediate on their behalf (for a fat fee, of course) in order to achieve – or even attempt to achieve – a given outcome, or whatever part of it they might afford.
Technology does not create new winners as it becomes more available, dependable, and economical. It is almost always that the incumbents are the force behind product improvement. PCs for example, have been more and more capable and less and less costly ever since they were invented – and all under the guidance of what is essentially the Wintel incumbency.
What technology does do in Disruptive Innovation is to enable new winners to emerge and overwhelm the incumbent status quo by helping the center of gravity of the market shift to one that is independent of the incumbent stronghold. In the case of the PC being disrupted by tablets and phones, none of which are even remotely comparable to the least capable Wintel machine – nor were they particularly inexpensive at the outset – the center of gravity was shifted from those who produce to those who consume (as is often the case in Disruptive Innovation) and as such, Wintel has ceased to be the dominant influence on the direction of what has become the new primary purpose of “personal computing”.
(Not to mention that it’s been a disaster for PC-makers that saw nothing but improving profits for the past few decades.)
I’m afraid following Randy’s admonition to wait until Disruption becomes so clearly evidenced as not to leave a choice is precisely the path followed by each and every failed incumbent to date, so unless one wants to be yet another such statistic, it would be best to help sell Randy’s advice to one’s competitor, in the hope that they won’t know any better and actually follow it.
Rick Mueller
Manager Disruptive Innovation Group at LinkedIn
https://www.linkedin.com/grp/home?gid=1837479
Thank you, Rick, for your comments. I wish more of those who read my posts would share their own thoughts about the given subject. I agree with much of what you say and with some of what Randy says but that’s not the point. Free and open, principled agreement and disagreement is the point and LinkedIn is among the thought leaders in expanding opportunities to share ideas. I think LinkedIn Pulse is a breakthrough innovation. That said, all of us would be well-advised to keep a suggestion from Voltaire in mind: “Cherish those who seek the truth but beware of those who find it.”
Rick, I just ran across this.
After reading your response, I don’t think we are that far off. As I mentioned, customers want things faster, better, cheaper, and friendlier – which is what I hear you saying when you say that customers don’t want to be beholden to anyone mediating on their behalf.
I didn’t say that customers always hate disruption. The actual words were sometimes they don’t value it, and sometimes they hate it.
As for PC’s, they have been improved under the Wintel incumbancy – except that it was easy for anyone to be in that business. Dell disrupted the status quo. The guy in the computer shop who built his own disrupted the status quo. And, Apple disrupted the status quo. You are correct – technology doesn’t pick winners and losers, but it does enable new ones to challenge. Sometimes they stick. Other times they don’t. But from the standpoint of a customer, I didn’t want to be disrupted. I just wanted it to be faster, better, cheaper, and friendlier.
And, if you read my comments as suggesting that anyone should wait until disruption is clearly evident, I’m sorry. I did say that you become disrupted if you ignore what is going on around you – and that is a mistake. Uber didn’t do anything with the taxi industry that the industry couldn’t have done on its own. It waited too long, and is now being disrupted. The same is true of many other industries.
This is an edited version of a longer post. The best position is do the disrupting. But if you find your business or industry being disrupted, it is because you haven’t paid attention or failed to act when you should have.
Great comments. Thanks for jumping in.