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BWD Apr 2012 - Disruptive innovation


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BWD Apr 2012 - Disruptive innovation

  1. 1. Disruptive Innovation Simon Sturmer 19 Apr 2012
  2. 2. InnovationQuick thought experiment ○ Think of the fastest-growing, exciting, most innovative business of our time.. ○ Now fast-forward 15-20 years
  3. 3. Definition & OriginDisruptive Innovation - Clayton Christensen, 1997 "An Innovation (product, service or experience) from a newcomer that enters a market displacing or crippling existing businesses"
  4. 4. ExamplesNew Entrant vs Incumbent ○ iTunes vs Sony Music ○ Amazon/Ebay vs Brick & Mortar ○ Skype vs Traditional Telco ○ PC vs Mainframe
  5. 5. DisruptionWithout market disruption, would we evenhave startups? ○ Big businesses get bigger ○ Rich get Richer ○ New Entrants dont have the capital, brand or distribution channels
  6. 6. Sources of Disruption  ○ New Distribution Channel (the Internet) ○ De-regulation, Geo-political ○ New Markets (China, Mobile phones) ○ Disaster, Financial Crisis ○ **Accelerating Growth in Technology** ...
  7. 7. Black Swan EventsNicholas Taleb - "Fooled by Randomness" - 2004"A surprise event with major impact which, in hindsight, seems obvious" ○ The rise of the Internet ○ Google - ○ The iPhone ○ Financial/Economic  
  8. 8. UnpredictabilityIdeas that are disruptive ○ Popularity vs Potential to be Revolutionary ● 5-10% - Brilliant, Majority think its insane ○ Not necessarily, a new company, but a new entrant to an industry (iTunes) ○ Inherently unpredictable (Black Swan), but in hindsight its obvious (Google)
  9. 9. Moores Law Gordon Moore, 1965 "Number of transistors doubles every 1-2yr" ○ Started with 5 data-points ○ Non-linear curve is extremely hard to identify at first ○ Applies to various fields ● Storage, CCD density ● Gene Sequencing ● Internet Growth  
  10. 10. Ray Kurzweils Extrapolation
  11. 11. Pace of Human Innovation ○ Every innovation the result of one or more prior innovations ○ Think of Ideas as "procreating" and look at innovation similar to population growth ○ Emergent Layers of Abstraction ● Life sciences (genetics, biology) ● Energy and clean-tech ● Internet
  12. 12. Coming back to the Web ○ Greatest new distribution medium since the printing press (Dell, Amazon, Skype) ○ Prior to this, how many great innovators would ever have their ideas see the light of day? ○ Globalization & lower barriers to entry ○ Internet itself is growing in a nonlinear fashion
  13. 13. Disruptive Market Entry ○ Entering a market as a cheaper, lower-quality or lower-performance alternative (VOIP, CCD, E2W) ○ As technology improves, pushes the incumbent into an ever-shrinking high-end niche ○ As growth crosses the "knee" in the curve, the new entrant has effectively disrupted the market ○ Large companies often see this coming, but rarely have the power or foresight to stop it
  14. 14. Present Day Examples ○ Mobile is doing to the PC what the PC did to the Mainframe ○ Electric Vehicles (E2W - China) ○ 3D Printers ○ ARM - Intel
  15. 15. Exponential Growth of Computing
  16. 16. Projecting Technological Growth ○ Cant predict "Black Swan" -style disruptions, but we can count on the bigger-picture growth ○ Looking at mobile computing growth purely mathematically, by 2036: ● size of a red blood cell ● MIPS times 10^9 ○ Applications in Medical, Clean Tech, Bio/Nano engineering, Machine Learning, etc  
  17. 17. Wrapping up ○ Were witnessing unprecedented growth in industries such as the Internet ○ Due to predictable and unpredictable forces, new entrants have incredible advantages ○ Regardless of Financial, Economic and Political effects, the pace of human innovation increases ever faster  
  18. 18. Disruptive Innovation Simon Sturmer  (will link to slides and references using github or meetup) Thanks for your time.