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5 Examples Of Disruptive Innovation

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5 Examples Of Disruptive Innovation

  1. 1. 5 Examples of Disruptive Innovation
  2. 2. Christian Sandström holds a PhD from Chalmers University of Technology, Sweden. He writes and speaks about disruptive innovation and technological change. www.disruptiveinnovation.se
  3. 3. Harvard professor Clayton Christensen coined the term disruptive innovation in his book ’The innovator’s dilemma’, published in 1997.
  4. 4. Harvard professor Clayton Christensen coined the term disruptive innovation in his book ’The innovator’s dilemma’, published in 1997. This presentation gives five illustrative examples of disruptive innovation.
  5. 5. A disruptive innovation initially offers a lower performance according to what the mainstream market has historically demanded.
  6. 6. A disruptive innovation initially offers a lower performance according to what the mainstream market has historically demanded. At the same time it provides some new performance attributes, which in turn makes it prosper in a different market.
  7. 7. A disruptive innovation initially offers a lower performance according to what the mainstream market has historically demanded. At the same time it provides some new performance attributes, which in turn makes it prosper in a different market. As it improves along the traditional performance parameters it eventually displaces the former technology.
  8. 8. For further detail on this concept, click here: http://www.slideshare.net/Christiansandstrom /disruptive-technologies-an-introduction
  9. 9. Number 1:
  10. 10. The Transistor Radio
  11. 11. Transistor Radio Analogue Radio Traditional performance New performance
  12. 12. Transistor Radio Analogue Radio Traditional Worse sound performance New performance
  13. 13. Transistor Radio Analogue Radio Traditional Worse sound performance New Portable performance Low Battery consumption
  14. 14. Being portable and offering worse sound quality, the transistor radio was adopted by teenagers who could bring music to the beach.
  15. 15. As the sound quality improved, it eventually displaced the analogue, big furniture radios.
  16. 16. Number 2:
  17. 17. Pocket calculators
  18. 18. Pocket calculator Desktop calculator Traditional performance New performance
  19. 19. Pocket calculator Desktop calculator Traditional Worse computing performance performance New performance
  20. 20. Pocket calculator Desktop calculator Traditional Worse computing performance performance New Portable performance
  21. 21. Over time, the computing performance of these smaller, simpler calculators was improved.
  22. 22. As they became cheaper and were sold in larger and larger volumes, sales offices lost their value. Calculators started to be sold in bookstores and large retail stores.
  23. 23. Number 3:
  24. 24. LCD TV versus Cathod Ray Tube (CRT) TV
  25. 25. LCD TV CRT TV Traditional performance New performance
  26. 26. LCD TV CRT TV Traditional Worse image quality performance New performance
  27. 27. LCD TV CRT TV Traditional Worse image quality performance New Low battery consumption performance Low weight
  28. 28. LCD screens initially prospered in various applications where image quality wasn’t important.
  29. 29. In mobile phones, portable video games and cameras, battery consumption and weight were more important.
  30. 30. When the image quality had become good enough, they displaced CRT TVs in the 2000s.
  31. 31. Number 4:
  32. 32. Integrated steel mills VS minimills. Photo: www.jornmark.se
  33. 33. Minimills Integrated mills Traditional performance New performance
  34. 34. Minimills Integrated mills Traditional Worse steel quality performance New performance
  35. 35. Minimills Integrated mills Traditional Worse steel quality performance New Cheaper, easier to produce performance
  36. 36. The minimill technology used scrap, put it in a furnace and made new steel of it.
  37. 37. The minimill technology used scrap, put it in a furnace and made new steel of it. Cheap, low quality steel.
  38. 38. The minimill technology used scrap, put it in a furnace and made new steel of it. Cheap, low quality steel. The integrated steel companies were more than happy to get rid of this low-margin business and instead focus on the high-end.
  39. 39. The minimill technology used scrap, put it in a furnace and made new steel of it. Cheap, low quality steel. The integrated steel companies were more than happy to get rid of this low-margin business and instead focus on the high-end. So they did, but slowly and steadily, the minimill technology offered better steel quality and captured segment after segment.
  40. 40. Eventually, the integrated steel mills started to suffer, badly.
  41. 41. Number 5:
  42. 42. Mobile phones versus regular phones
  43. 43. Cell phone Old phones Traditional performance New performance
  44. 44. Cell phone Old phones Traditional Worse sound quality performance Expensive New performance
  45. 45. Cell phone Old phones Traditional Worse sound quality performance Expensive New Portable performance
  46. 46. As mobile phones became cheaper, the sound quality improved and new functions were added, it eventually displaced the analogue phones.
  47. 47. Sources Christensen, C.M. (1997) The Innovator’s Dilemma, Harvard Business School Press, Cambridge, Massachusetts.
  48. 48. Find out more: www.disruptiveinnovation.se

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