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The Innovators Dilemma

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Improve performance of existing products. Usually driven by customer ... Traditional photography Digital photography. Bricks and mortar Online retailers ... – PowerPoint PPT presentation

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Title: The Innovators Dilemma


1
The Innovators Dilemma
  • Clayton M. Christensen
  • How Good Management Can Lead a Company Towards
    Failure

2
Sustaining Technologies
  • Most Common
  • Usually Incremental
  • Improve performance of existing products
  • Usually driven by customer wants or needs
  • Seen as safe bets
  • Easier to get budget for as market exists

3
Disruptive Technologies
  • Eventually ousts existing technology
  • Drive market leaders toward failure
  • Good management practices discourage adoption
  • Listen to customers
  • Allocate resources to existing technologies
  • Focus on large markets
  • Focus on higher margins
  • Usually start small offering inferior benefits
  • Initially small or non-existent market

4
Trajectory Map Mechanical Excavator Market
5
Christensens Recommendations
  • Set up a separate organization
  • Independent performance evaluation
  • Dedicated resources
  • Plan for failure
  • Look for a new market
  • Dont get tunnel vision

6
Disruptive Technology Examples
  • Encyclopedia Wikipedia
  • Wireline telephone Wireless telephone
  • Open surgery Arthroscopic surgery
  • Compact disk iPod
  • Sailing ships Steam ships
  • Traditional photography Digital photography
  • Bricks and mortar Online retailers
  • Full service stock brokerage Online brokerage
  • Matt Babb in Class Matt Babb Graduated

7
  • Read the Book!
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