Thursday, May 26, 2005

Innovation - 1

Reading this article from Strategy + Business, Titled "Top-Down Disruption" By N Carr.

I for this interesting excerpt from the article, in this section the author quote Professo Christensen, the author of the book Innovator’s Dilemma: When New Technologies Cause Great Firms to Fail
, Discussed in this passage is the model of disruptive innovation.

Professor Christensen also offers a model for what a disruptive innovation looks like. He argues that, when initially introduced, a disruptive product or service gener-ally “underperform[s] established products in mainstream markets,” “almost always takes root in a very undemanding application,” and “sells for less money” than current offerings. It tends to be ignored by the majority of buyers, who view it as falling short of their needs, and shunned by traditional suppliers, who see little to gain by selling a cheap product to a niche market. Because of these characteristics, the innovation initially gains a foothold in the lower reaches of the market, among less discriminating cus-tomers. Then, as its performance steadily improves, it rises to redefine the entire market, displacing industry incumbents in the process.

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