Rita McGrath from Columbia Business School, Felix Oberholzer-Gee from Harvard Business School, and Derek van Bever, also from Harvard, dive into the fascinating world of disruptive innovation. They discuss its origins, tracing back to a ceramic startup that challenged industry giants in the 1980s. The conversation highlights the shift from product innovation to innovative business models and critiques of the theory's application. They explore lessons from the dot-com boom and emphasize the need for established companies to adapt while balancing current operations with future opportunities.
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insights INSIGHT
Pre-Christensen Innovation
Before Clayton Christensen, innovation was seen as stemming from R&D, focusing on big, tangible advancements.
These innovations were generally "new and improved," adding features or improving existing qualities.
question_answer ANECDOTE
Christensen's Startup Experience
Christensen co-founded Ceramics Process Systems, aiming to create better ceramics.
They were delayed, a competitor emerged, and the expected profits vanished, shaping Christensen's view on disruption.
insights INSIGHT
Disruption's Power
Christensen's theory explained why small companies could unseat industry giants, focusing on causality.
He highlighted the importance of time, gained by being ignored or prompting incumbents to move upmarket.
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In this influential business book, Clayton Christensen shows how even the most outstanding companies can lose market leadership when they fail to adapt to disruptive innovations. Christensen explains why companies often miss new waves of innovation and provides a set of rules for capitalizing on disruptive technologies. The book uses examples from various industries, including the disk drive, mechanical excavator, steel, and computer industries, to illustrate trends that lead to success or failure in the face of disruptive technologies.
Loon Shots
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Safi Bahcall
Safi Bahcall's "Loon Shots" explores the dynamics of innovation within organizations, examining why groundbreaking ideas often face resistance and how to foster environments where they can thrive. The book uses real-world examples from various industries to illustrate the challenges and opportunities in nurturing disruptive innovation. Bahcall introduces concepts like the "barbell structure" to highlight the tension between creative exploration and efficient execution. He emphasizes the importance of balancing risk-taking with responsible scaling, advocating for a system that supports both "artists" and "soldiers" within an organization. The book offers practical strategies for leaders to cultivate a culture of innovation and overcome the obstacles that stifle groundbreaking ideas.
In the 1980s, Clayton Christensen cofounded a startup that took over a market niche from DuPont and Alcoa. That experience left Christensen puzzled. How could a small company with few resources beat rich incumbents?
It led to his theory of disruptive innovation, introduced in the pages of Harvard Business Review in 1995 and popularized two years later in The Innovators Dilemma. The idea has inspired a generation of entrepreneurs. It has reshaped R&D strategies at countless established firms. And it has changed how investors place billions of dollars and how governments spend billions more, aiming to kickstart new industries and spark economic growth.
But disruption has taken on a popular meaning well beyond what Christensen’s research describes. Some critics argue that the theory lacks evidence. Others say it glosses over the social costs of lost jobs of bankrupted companies. And debate continues over the best way to apply the idea in practice.
4 Business Ideas That Changed the World is a special series from HBR IdeaCast. Each week, an HBR editor talks to world-class scholars and experts on the most influential ideas of HBR’s first 100 years, such as shareholder value, scientific management, and emotional intelligence.
Discussing disruptive innovation with HBR editor Amy Bernstein are:
Rita McGrath, professor at Columbia Business School
HBR IdeaCast 
