wisdom to win

 Wisdom to Win
search bar left
search bar right
 

Clayton Christensen (1952- )Clayton Christensen

 

Harvard Business school professor and expert on innovation (pictured right) .

 

Key books

 

The Innovator’s Dilemma (1997)

 (see for more detail The Innovator’s Dilemma in the Business Books section)

 

Successful, innovative companies face a problem (the innovator’s dilemma), caused by “disruptive innovation”.

 

What is disruptive innovation?

It involves competitors providing simpler, cheaper products (to customers who don’t need the over-sophistication of existing products) and then moving up market.

For example, mobile phones, digital cameras and discount retailers stole business from ordinary phones/cameras and department stores.

Faced by competition from these disruptive technologies, companies will eventually fail, even though they adopt strategies associated with organizational excellence like:

  • innovation and customer focus.
  • long-term planning.
  • total quality management.

 

To benefit from disruptive innovation, an organization must be:

 

1. Opportunistic 

The difficulty is that disruptive innovation requires being first in a market that you know least about with (initially) small markets and low profit margins.

 

2. Prepared to ignore customers 

Existing customers will have to be ignored, because they can tell you nothing about markets that don’t exist yet.

So don't be totally dependent on market research.

 

3. Flexible 

An organization’s values and processes must change and adapt to new markets.

 

The innovator’s job is to take advantage of disruptive innovation without sacrificing existing customers.

The best way to do this is to set up a separate business unit for radically new products.

 

Key quote on customers

There are times at which it is right not to listen to customers 

 

 

The Innovator’s Solution (2003), written with Michael Raynor (pictured right below)

 Clayton Christensen

There are two types of disruptive innovation:

 

1. Low-end disruption

Providing simpler, cheaper products to existing customers.

 

2. New-market disruption

Selling to new customers who are attracted by the new product’s simplicity and convenience.

 

Successful disruptive innovation depends on:

 

1. Battles with competitors

Established companies are much more likely to succeed with improvements to existing products than with disruptive innovation (usually carried out by new entrants).

 

2. Effective market segmentation

Aim new products at market segments that are based on jobs that customers are trying to get done.

 

3. Successful strategy

  • go for high growth, disruptive innovation when business is booming, so that money is available from reinvested profits.
  •  be patient for growth and impatient for profit.

 

4. Effective leadership

Disruptive innovations are risky, so managers must be able to cope with this risk and the greater likelihood of failure

Leaders must seek profit from new products as quickly as possible.

 

Key quotes on innovation and business success

Disruption does not guarantee success but it sure helps.Clayton Christensen

 

 

Disrupting Class (2008), written with Michael Horn (pictured right above) and Curtis Johnson (pictured right below)

To be successful and to provide world-class talent for businesses, schools must be “customer-centric” Clayton Christensen

i.e. they must motivate their students by customizing their learning to their individual requirements through computer software.

Disruptive innovation should be applied to schools i.e. making student learning easier, less complicated and more convenient and affordable.

 

Key quote on innovation and learning

Motivation is the catalyzing ingredient for every successful innovation. The same is true for learning.
 

 

The Innovator’s Prescription (2009), written with Jerome Grossman and Jason Hwang (pictured right below)

Health care can be improved (with lower costs and better quality) through:

Clayton Christensen

  • disruptive innovation.
  • creating value for patients.
  • providing the solutions patients need.

Information technology and the Internet should also be used to:

  • diagnose health problems and provide remedies without the need for hospitalization.
  • improve administrative efficiency and co-ordination between all health care providers.
  • get patients involved in their own health care.
  • enable doctors, nurses and patients to help each other.
  • allow nurses to provide patient care without the need for a doctor.

 

Key quote on health

Health care is a terminal illness for America’s governments and businesses.

 

Free Newsletter
Enter your name and e-mail address to receive our free newsletter with analysis of business issues and new business books

Quotes