Disruptive Innovation Theory and Entrepreneurship
Disruptive Innovation Theory: Why Giants Fall How did Netflix kill Blockbuster? Why did iPhones replace Nokia? The answer often lies in Disruptive Innovation Theory . Developed by Harvard Business School professor Clayton Christensen in his famous book, The Innovator’s Dilemma (2003) , this theory explains why seemingly successful, well-managed companies often fail when faced with new technologies. The Two Types of Innovation Christensen’s core argument is that innovation comes in two forms: Sustaining Innovations: These improve existing products along traditional dimensions of performance. They make good products better. Example: A new smartphone with a faster processor and a better camera. These appeal to existing, high-end customers. Disruptive Innovations: These are initially lower performing along traditional metrics, but compensate with increased simplicity, convenience, customizability, or affordability. They appeal to new, often overlooked, custo...
