Premium Only Content
Disruptive technology
What is disruptive technology (disruptive innovation)?
Disruptive technology, often referred to as disruptive innovation, is when a new business model attracts an underserviced market or revenue stream and grows until it supplants incumbent competitors. Technologies are not in themselves disruptive, but their application in a new business model can be.
The term disruptive technology was originally coined by Harvard Business School professor Clayton Christensen in 1995 and further expounded in his book The Innovator's Dilemma in 1997. In the follow-up work, The Innovator's Solution, he replaced the term with disruptive innovation.
What are the characteristics of a disruptive innovation?
In The Innovator's Dilemma, Christensen separates new technology into two categories: sustaining and disruptive. Sustaining technology relies on incremental improvements to an already established technology and supports existing players in the market.
Disruptive technology is a development that allows a new player to service a lower market segment that incumbent players do not cover due to lower profitability. As the disruptive technology advances, the quality improves so that it supplants the incumbent in the more profitable high-end market.
In The Innovator's Solution, Christensen instead uses the term disruptive innovation. He recognized that a technological advancement is not in and of itself either sustaining or disruptive. Instead, it is how the technology is applied to a new market or in a new business plan that it becomes disruptive to the market.
Key to understanding this is the fact that most incumbent players in a market have large research and development departments and follow technological advancements themselves. So, they will quickly adopt any obviously superior technology. Disruptive companies instead use the innovation to open a new market segment at a lower price point. It is the lack of market flexibility of the incumbent players that allows companies to eventually disrupt the market, not pure technological superiority.
-
13:43
Cooking with Gruel
2 days agoCreamy Saffron Risotto
103K20 -
18:38
DeVory Darkins
1 day ago $27.44 earnedTrump Makes HUGE Announcement that may spark GOP Battle
84.2K83 -
2:13:05
The Nerd Realm
14 hours ago $6.26 earnedNew Years Eve! Fortnite Hunters w/ YOU! Creator Code: NERDREALM
68.4K5 -
11:04:44
FusedAegisTV
1 day agoNYE Eve! - 2025 Incoming 🎉 - 12hr Variety Stream!
133K7 -
1:18:52
Awaken With JP
17 hours agoSomehow The World DIDN’T End This Year! - LIES Ep 72
167K91 -
1:19:34
Michael Franzese
15 hours agoWhat 2024 Taught Us About the Future?
133K33 -
1:48:09
The Quartering
16 hours agoBird Flu PANIC, Sam Hyde DESTROYS Elon Musk & Patrick Bet David & Woke Witcher?
139K79 -
4:47
SLS - Street League Skateboarding
3 days agoLiz Akama’s 2nd Place Finish at SLS Tokyo 2024 | Best Tricks
61.7K6 -
4:06:54
LumpyPotatoX2
15 hours agoHappy New Year Rumble ! - #RumbleGaming
44.9K1 -
10:37
One Bite Pizza Reviews
1 day agoBest of Barstool Pizza Reviews 2024
69.8K32