The document discusses Christensen's theory of disruptive innovation and why good management can lead companies to fail. It explains that classical good management pursues sustaining technologies in major markets but neglects disruptive technologies, which start in low-margin markets but eventually overtake sustaining technologies. Managers focus on satisfying existing customers and investors and developing technologies for well-established market needs. However, disruptive technologies may not satisfy existing demands and have undefined new markets. The document suggests two solutions for companies: pursuing both sustaining and disruptive technologies internally, which risks overcomplicating the organization, or establishing independent organizations for disruptive technologies under the parent company.

1. A QUICK SUMMARY OF
The Innovator's Dilemma
by Elizabeth Keshishyan
Dec 10, 2019

2. WHY GOOD MANAGEMENT CAN LEAD TO
FAILURE? | PART 1.1
Sustaining
Technology
Improves the performance of
established products, along the
dimensions of performance that
mainstream customers in major
markets have historically valued.

3. WHY GOOD MANAGEMENT CAN LEAD TO
FAILURE? | PART 1.2
Disruptive
Technology
Any tech that enhances or creates a
completely new one. It may result in worse
product performance, at least in the near-
run. Has an undefined and low-margin
market. Creates a future demand.

4. Classical Good
Management
Historically, good management has pursued high-end
market opportunities which led to sustaining tech
development. That is because these markets are
mature, needs are known, and returns predicted.
While, disruptive tech is neglected due to low-
margin in the beginning, it overruns the
sustaining tech and makes it fail in long-run.
WHAT SHOULD GOOD MANAGEMENT DO?
WHY GOOD MANAGEMENT CAN
LEAD TO FAILURE? | PART 1.3

5. Market Demand 4
Disruptive Tech
The pace of technological progress can, and often
does, outstrip what markets need.
Therefore, it's typical that disruptive technology
doesn't satisfy a well-established market demand.
It should nurture its market starting with low
margins in the beginning.
Good managers should keep an eye on the bigger
picture.
WHY GOOD MANAGEMENT CAN
LEAD TO FAILURE? | PART 2

6. Resource Dependence
of Firms
The businesses are dependent on their customers
and investors to generate the required fuel to
keep the business going. Therefore, managers tend
to satisfy these users who are paying back.
For this reason, disruptive technology that solves
yet underwater needs, cannot be developed.
Customers won't be paying for what they think they
don't need.
What should managers do?
WHY GOOD MANAGEMENT CAN
LEAD TO FAILURE? | PART 3

7. Solution 1: Battle
Small markets don't solve the growth needs of
large companies.
Therefore, the main technology cannot be
discharged. It will draw up the company's
resources.
A possible solution is to pursue both sustainable
and disruptive tech within the same company.
However, the chances are that this will complicate
the organizational processes and will consume too
much of resources.
WHY GOOD MANAGEMENT CAN
LEAD TO FAILURE? | PART 4

8. Solution 2:
Intrapreneurship
Small markets don't solve the growth needs of
large companies.
Therefore, in order not to waste the opportunity
that comes with disruptive tech, the large
business should create an independent organization
and embed it among emerging customers that do need
the technology.
The large business should own some part of the
newly established business.
WHY GOOD MANAGEMENT CAN
LEAD TO FAILURE? | PART 5