Three Things: What is Disruptive Innovation?



history is littered with successful businesses disrupted by new technologies and upstart companies who redefine markets and deliver value in new ways Kodak blackberry blockbuster are just a few iconic companies that have been disrupted in recent years but disruption is not new it's been around for generations while disruptions vary in timing and intensity they tend to follow similar patterns first the era of ferment everyone remembers Apple's iPad but they tend to forget the hundreds of digital music players that came before disruptive innovations have an incubation period that is often characterized by the entry of a large number of entrepreneurial ventures as well as incumbent firms vying for dominance in the marketplace improvements in the innovation may be slow at first but eventually accelerates as more and more experimentation occurs second the shakeout as a disruptive innovation finds traction in the market a competitive shakeout occurs a dominant product design or business model emerges the numerous players in the market decreases Ventures go out of business established businesses give up on the new market mergers and acquisitions bring together former competitors when the dust clears that may only be a few significant players left think Apple and Samsung with smartphones or uber for on-demand passenger services third the end of growth over time the innovation matures and growth slows the market becomes saturated each incremental innovation requires more and more effort this is usually the time when things get interesting again entrepreneurs start experimenting with radically different concepts innovators and established businesses or entrepreneurs invest in next-generation technology a new disruption may be just around the corner for over 50 years the auto industry was relatively stable suddenly Tesla reinvigorates electric vehicles and Google and others start testing driverless vehicles the market is suddenly flushed with radical innovations as the process of disruption begins again disruptive innovation needn't be scary by understanding these three patterns you can enhance your chances of being the disrupt door rather than the disrupted

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