Today I want to talk about a classic business dilemma which I call “Disrupt or Be Disrupted”. Have you heard about Clayton M. Christensen‘s books on innovation particularly “The Innovator’s Dilemma,” a book that explores why established companies struggle to innovate, despite having a lot of resources and expertise? This book has been widely discussed by businesses, and the ideas described there are still very relevant.

Intro

Christensen, in his work “The Innovator’s Dilemma,” questions the ability of tech giants or just established corporations often face a dilemma when it comes to innovation. On one side, they want to be innovative and take advantage of new technologies and opportunities to grow be a growth company. On the other side, they are limited by their own culture, operations, and most important – processes, which can make it difficult for them to pursue new ideas and their implementations. This dilemma can lead such companies to lose their dominance in the market to young startups that are more nimble and better equipped to pursue new opportunities.

Disruptive technology is the main concept in this book. Christensen’s definition of disruptive technology is a new technology that initially serves a small or niche market, but it has “grows” characteristics and can disrupt the existing market or the segment of the market. This can happen in a number of ways, such as by offering lower cost, better performance, or more convenience to customers. The key point is that disruptive technologies often start small and then grow to disrupt the existing market.

This book has another interesting point, the importance of focusing on the customer. Christensen says that established companies often become too focused on serving the needs of their existing customers, and this can lead to limitations in their ability to pursue new opportunities. At the same time, companies need to focus on understanding the needs of new customers and developing products and services that meet those needs. To be a “growth” company with such an approach is close to impossible.

Some examples

One of the book’s most memorable examples is how the disk drive industry was disrupted by new entrants. All the players in that industry were focused on serving the needs of the existing market, which mostly were large computer companies and producers. The new startups, at the same time, focused on serving new customers, such as small businesses and consumers, by offering smaller, less expensive disk drives. Over time, these new startups grew and disrupted the market, pushing the established players to the sidelines.

My favourite story from the book is how the personal computer disrupted the minicomputer industry. The minicomputer industry was dominated by well-known brands, Big Corps like Digital Equipment Corporation (DEC), who were focused on doing what they know how to do – producing more of the existing products for large corporations and government agencies. The personal computer focused on serving the needs of new customers with more convenient computing solutions. These days I’m sure most of you never even heard of such a company.

Lessons learned

If you want to survive in our Era, especially in the tech business you need to be a disruptor by nature or look for such people for your team. You need to be hungry for new things that can change the world. As a side note, you will fail many times, as not every idea will change the world for one or another reason. But as a leader, you always need to look for one and be ready to fail again and again until you find one. Then, build, scale, polish and start again. It is challenging, not just complex but also physically and mentally as it often requires companies to change their operations, culture, and processes. But the alternative is to be left behind as the market and leave space for the young.

Build, scale, polish and start again.

Another lesson that we can learn is that as a company you need to focus on constantly expanding your customer base and creating a wider variety of services you are offering to them. Look at Apple, they not just making products they are making their company a part of your lifestyle. This can be difficult, as it requires companies to think beyond their existing products and services and to be willing to embrace new ideas and technologies. But the alternative is to be left behind as the market changes and new entrants capture market share by serving new customers.

Summary

“The Innovator’s Dilemma” is exceptionally good work about disruption. It highlights a very important challenge that established companies face when it comes to innovation. You can learn how companies can overcome these challenges and make you closer to the “growth” mentality. Whether you’re an established company or an early-stage startup, the ideas and concepts are worth considering, as they can help you to keep your hand on a pulse of innovation and disruption.

I strongly suggest reading “The Innovator’s Dilemma if you are interested in innovation and disruption. The book provides a clear framework for understanding why established companies struggle to innovate, and it offers practical advice for overcoming these challenges. Whether you’re an entrepreneur, an executive, or just someone who is interested in innovation, “The Innovator’s Dilemma” is a must-read.

Our world is changing every second, we are living in a crazy time and innovation is more important than ever. Companies that are able to embrace new technologies and able to find new opportunities are likely to succeed, the others just fall behind.

Note:

If you are a big fan of reading and starving to learn about startup mindset and how to build the next big thing I want to suggest you a few more books, that you might find interesting:

• “The Innovator’s Solution” by Clayton M. Christensen
• “Competing Against Luck” by Clayton M. Christensen, Taddy Hall, Karen Dillon, and David S. Duncan
• “The Lean Startup” by Eric Ries