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Common Misconceptions about Disruptive Innovation

Posted by Arup Das on December 5, 2017
 

Disruptive innovation, a term of art coined by Clayton Christensen, describes a process by which a product or service takes root initially in simple applications at the bottom of a market and then relentlessly moves up market, eventually displacing established competitors.

1.      Disruption can take time. 

Disruptive Innovation is confused and often used to refer to a product or service at a single point in time. However it is actually a process and an evolution of the product or service over time. Disruption can take time, and competitors usually overlook disrupters.

When Wikipedia launched in 2001, the validity of the service of having an online encyclopedia that is written and edited by volunteer editors was questioned. Compared to the market leader at the time, Encyclopedia Britannica who had articles written by paid experts, Wikipedia was thought of as just the latest fad in the age of the internet. However as technology caught on to Wikipedia, the free encyclopedia appealed to those seeking information everywhere through offering free online access to over 5 million articles with a quicker update cycle than Britannica. This led to Britannica ending production in 2012 after 244 years and was unable to compete with Wikipedia’s free encyclopedia. Just because a company is successful doesn’t mean that it is disruptive by nature.

2.     Not all Disruptive Innovations Succeed.

A common misconception is that just because a company is successful it is disruptive. Not every disruptor in a market can be successful and not every newcomer in the market is disruptive. By saying that all successful newcomers in the market are successful we are effectively giving the false pretense that their strategies for success are the sources for success.

3.      Companies don’t have to disrupt its core business when it is being disrupted.

Companies shouldn’t overreact to disruptors in the market by jumping ship from their core business. Some options that they have would be to create a new sector in the company focused on growth opportunities that are create through disruption. An example of this would be Whole Foods creating a small sector for online grocery delivery to compete with disruptors such as Fresh Direct or Max Delivery. Whole Foods is still competing with these disruptors while keeping their brick-and-mortar stores. 

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