Christensen Disruptive Innovation Model

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Christensen’s Disruptive Technologies Model:

Christensen’s Disruptive Technologies Model Impact of technology on a firm's existence . By: Mohammad Jahanzeb Shahbaz Wali Shams Kadiwal

Disruptive Innovation Model What is it?:

Disruptive Innovation Model What is it? Theory by Clayton Christensen. Theory used to describe the impact on new technologies on a firm’s existence.

Origin of the Disruptive Innovation Model:

Origin of the Disruptive Innovation Model In the book Harvard Business School professor Clayton Christensen investigated why some innovations that were radical in nature reinforced the incumbent’s position in a certain industry, contrary to what previous models (for instance the Henderson – Clark model) would predict. More specifically he analyzed extensively the disk drive industry because it represented the most dynamic, technologically discontinuous and complex industry one could find in our economy. Just consider that the memory capacity packed into a square inch of disk increased by 35% per year, from 50 kilobytes in 1967 to 1,7 megabytes in 1973, 12 megabytes in 1981 and 1100 megabytes in 1995.

Types of Innovation:

Types of Innovation Sustaining Innovation : Companies try to take an existing market from an entrenched competitor. Disruptive Innovation: Companies can try to take on a competitor that either creates new markets or take root among an incumbent’s worst customers. There are two types of Disruptive Innovation: New market by targeting non-consumers Low end of an established market

Putting Disruptive Process To Test:

Putting Disruptive Process To Test Six Steps to Put Christensen's Jobs-to-be-Done Theory into Practice 1 .  What are the high-level jobs-to-be-done? Rather than looking just at what people buy, examine the needs that arise during their lives.  Sometimes the job is much broader than the product or service that is bought.

Process:

Process 2.  What are the current approaches and what pain points result? Jobs-to-be-done can sprawl across dozens of industry categories.  Clearly a company can’t address each job, but by looking broadly it can re-define its true “competition.”  After it understands the full landscape, it can focus narrowly.  Theaters may not want to invest in indoor playgrounds, but they need to see playgrounds as a rival every bit as real as a multiplex a few miles away. 3 .  What benchmarks exist in the full range of competing offerings and analogies? Companies should always compare themselves to directly comparable firms, but they should not be seduced by the simplicity of that exercise.  Through examining all that the full set of rivals and analogous offerings can do, they can get excellent ideas for their own business.

Process:

Process 4.  What performance criteria do customers use? Much psychological research has shown that even horribly complicated decisions are often reduced to a small handful of criteria that people can keep in mind at any one time. 5. What prevents new solutions from being adopted ? Managers are often too enamored of their own ideas.  Unfortunately, even compelling ideas can take a long time to catch on.  Indoor plumbing took 4,500 years from its invention to become widely adopted.  Really, is your idea better than indoor plumbing? 6.  What value would success create for customers? By understanding the value that lies in resolving a pain point, you can see how many degrees of freedom you have to engineer a new solution . Value can be defined by money, time, convenience, peace of mind, and other metrics.

Limitation of the Disruptive Innovation:

Limitation of the Disruptive Innovation Requires another strategy process which emergent and focused on unanticipated opportunities, problems and successes. Should focus on the what people really need but not on what the behavior of the customer Disruptive business cant attain the profit because of the nature of their business about new markets and low end of existing markets. But Venture Capitalists are impatient for the business to stats profits.

Assumptions Of Disruptive Innovation Conditions:

Assumptions Of Disruptive Innovation Conditions Companies risk death with decision to ignore technologies that do not appear to address their customer’s need. C reate an independent business unit whose size matches the emerging market.

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