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Disruptive Innovation

Disruptive innovations often derive from new technologies that change the structure of the market, usually with new entrants supplanting previous leaders. Disruptive technologies 'creep up' on the market, and are disregarded by the erstwhile main players because they often provide inferior performance, at least to start with, but they gain traction with a certain section of the market because they have some other benefit, such as being cheaper, or easier to use. However as they are developed their general performance increases and they eventually eclipse the previous technology and the companies that have not made the change.

Typical examples are digital photography replacing chemical photography, e-mails replacing letters and faxes and Wikipedia replacing Encyclopedia Brittanica.

However, disruptive innovations don't necessarily rely on new technology. A disruptive innovation can also be a new business model, or a combination of a new business model with a new technology

Examples might be low-cost airlines replacing scheduled airlines, internet shopping replacing high street shops.

The term disruptive technology or disruptive innovation was coined by Clayton Christensen in his 1995 article Disruptive Technologies: Catching the Wave, which he co-wrote with Joseph Bower and made famous in his 1997 book The Innovator's Dilemma.

"We didn't see it coming until it was too late"

This is often said by the executives of companies who have suffered from disruptive innovation introduced by another company, usually not one of their traditional competitors.

How can you avoid this fate? How can you become a disruptive company?

Contact us for the answers to these questions.

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