Disruptive Innovation

An overview of the topic of disruptive innovation in the marketplace.

This paper analyzes the concept of disruptive innovation, also known as disruptive technology and disruptive change. Using Ron Adner’s definition from his article titled When Are Technologies Disruptive? A Demand-Based View of The Emergence of Competition as a guide, it attempts to investigate the dynamics of disruptive innovation in the marketplace. It looks at some of key characteristics and attributes inherent in any disruptive innovation and outlines some useful strategies companies can use to protect themselves through identifying, assessing and even creating disruptive innovation. It concludes with a discussion concerning some of the major hurdles companies undergo when contending with such an event in their market space.

Introduction and Objective
The Dynamics of Disruptive Innovations
Sustaining vs. Disruptive
How to Identify and Assess Disruptive Innovation
How to Respond to Disruptive Innovation
Five Responses to Disruptive Innovation
Major Hurdles
How to Create Disruptive Innovation
Strategy #1 – Creating a New Market as a Base for Disruption
Strategy #2 – Disrupting the Business Model From the Low End
Another common hurdle in the face of disruption comes to light once a company has decided to embrace the innovation while continuing to operate the current business. Since, a disruptive innovation creates the need for such a different business model, and usually a different product, there is no question that complications arise when a company tries to incorporate the new business within the current model. The issues are numerous and range from funding, human resources, leadership, and cost structures just to name a few. To minimize these risks and hurdles studies suggest that the new business functions be carried out as an independent entity, linking back to the parent only when necessary or to take advantage of clearly beneficial synergies.