- Business Books
This is a truly
amazing business book - one that opened my eyes with each page I read.
The author uses real life industries, companies and people as case studies
and examples to prove his points, which are clearly articulated and
communicated throughout the book.
The basic premise
of the Innovator's Dilemma is that established companies are always
at risk of disruptive technologies precisely because they are well run,
market leading and customer focused. They have no tools to cope with
disruptive technologies and with small companies entering their market
better and making dumb mistakes is not the answer to the innovator's
dilemma. In the straightforward search for profits and growth, very
capable executives in very successful companies, using the best techniques
have led their firms towards failure.
- The pace of progress
that markets demand or can absorb may be different from the progress
of technology. Products that do not appear to be useful to customers
today may be exactly what they need tomorrow. It can hurt to listen
to your customers!
- Manaing innovation
mirrors the resource allocation process: innovations given low priority
in resources and funding will fail. Spin off innovations.
- Match the market
to the technology; rather, don't force fit disruptive technology into
mainstream markets, here they are almost sure to fail.
- Most organizations
capabilities are very specialized and context-specific than managers
like to believe - this comes from companies organizing correctly around
value networks that make them successful.
- The information
required to make large and decisive investments in the face of disruptive
technology does not exist. There is huge risk of failure and companies
must be able to create and combat disruptive technologies quickly,
cheaply and flexibly. Failure and learning are intrinsic to the search
for disruptive technologies.
- It is not wise
to always be a leader or always a follower. Companies must adjust
their approach depending on if they are pusuing a sustaining or disruptive
- Lastly, there
are powerful barriers to entry and mobility that differ significantly
from the types defined and historically focused on by economists -
small companies can build barriers quickly by focusing simply on things
that established firms won't (because they don't make any sense!)
How to spot disruptive
technology - use the litmus test:
- The technology
- It starts at
a very low price
- Minimizes infrastructural
and regulatory barriers
- Follows a path
of least resistance