12 - disruptive innovation what it is: one of the most important theories of innovation, but one which is usually completely misunderstood brought to prominence by professor clayton christensen's book the innovator's dilemma, this important theory provides an explanation as to why large, established companies eventually get overtaken by smaller ones, and it introduced the concept of. The theory of disruptive innovation, introduced in these pages in 1995, has proved to be a powerful way of thinking about innovation-driven growthmany leaders of small, entrepreneurial companies. Assignment help marketing research theories of disruptive innovation and value innovation you will critically examine the theories presented in unit 2 and then apply those theories to a current, publicly traded company.
Disruptive innovation: clayton christensen introduced the concept of disruptive innovation in his classic book the innovator's dilemma these tend to be new approaches to old products and services these tend to be new approaches to old products and services. Sustaining innovation vs disruptive innovation posted august 25, 2017 in business innovation is widely regarded as the single most important ingredient in today's economy , according to entrepreneur faisal hoque at fast company. Few academic management theories have had as much influence in the business world as clayton m christensen's theory of disruptive innovation, the business school professors write.
Incremental innovation and breakthrough innovation can be called sustaining innovation, these are two normal innovation process of products a disruptive innovation is an innovation which enables a product create a new market and value chain, and ultimately undermine the existing, stable market and value chain, replacing the previous technology. Theories of disruptive innovation and value innovation superior profitability (thompson, peteraf, gamble and strickland p 4) one well known strategy or theory of many companies is a term called disruptive innovation. Christensen's theory of disruptive innovation has gripped the business consciousness like few other ideas in a review of enduring business books, the economist called the theory one of the most influential modern business ideas 4 other commentators have noted that the theory is so widely accepted that its predictive power is rarely. Disruptive innovation explanation of the term a disruptive innovation is an innovation that helps create a new market and value network, and eventually disrupts an existing market and value network (over a few years or decades), displacing an earlier technology.
Value innovation becomes disruptive when, in its wake, existing value propositions become obsolete or superfluous the point that is often missed is that value innovation can be be disruptive or sustained only if the new value fills a need-gap of the customer. Fall 2015 andrew a king baljir baatartogtokh how useful is the theory of disruptive innovation few academic management theories have had as much influence in the business world as clayton m christensen's.
Theories of disruptive innovation introduction the purpose of this paper is to discuss the two theories, disruptive innovation and value innovation this paper will define each theory and compare and contrast the two, it will also identify a publicly traded company and analyze its capacity for strategic foresight and opportunities for disruptive or value innovation. Theory and value innovation 2a1, db 8004-01 spring 2013 houston, tx instructor: dr j outline i introduction ii innovation theories a disruptive innovation - sustaining, evolutionary and revolutionary b. The curriculum includes general innovation theories, foresight methodology, value chain disruption and strategy the general process is as follows first you to learn how to draw a map of the potential future business landscape.
Value innovation focuses on making the competition irrelevant by creating a leap in value for both the buyers and the company through opening up new and uncontested market space because value to buyers comes from the offerings utility minus its price, the assured value to the company is generated from the offering's price minus its cost. Innovation and disruption are similar in that they are both makers and builders disruption takes a left turn by literally uprooting and changing how we think, behave, do business, learn and go. Disruptive and value innovation are sometimes seen as competing theories disruptive innovation focuses on making low cost alternatives available to a mass audience that previously.
The problem with conflating a disruptive innovation with any breakthrough that changes an industry's competitive patterns is that different types of innovation require different strategic approaches. The theory of disruptive innovation was introduced in 1997, by harvard professor, clayton christensen and is based on the idea of innovation creating a new market with a value network in order to disrupt an existing market and value network, displacing established market leaders and dominant alliances. Disruptive innovation 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.