Wednesday, June 1, 2011

On the innovator's dilemma

Today, while trying to update a presentation, I found out that Powerpoint on my laptop somehow became corrupted, I pinged our friendly system guys, who took my laptop for 2.5 hours, and returned it after reinstalling MS-Office in worse shape (now it does not recognize Excell, and has also problems in Word), so tomorrow morning on the way to the dentist, I'll drop the laptop again with the friendly system guys, hoping they'll do better that time.   In some of the spare time, I had meeting, but it part of it I realized that everything I do somehow involves this laptop, so I decided to catch up on a book I started to read long time ago and never finished-  Clayton Christensen's book on the innovator's dilemma.   This is a classic book, published in 1997 that somebody recommended me to read several years ago.    

My of my favorite topics is the topic of disruptive technologies.  Christensen provides several reasons why it is difficult for big companies to create disruptive technologies, though they are those who damage the most.
Some of the reasons are:

  1. Companies depend on customers for resources:  disruptive technologies are developed not as part of customer requirement  (this reminds me that somebody in IBM said 6-7 years ago about event processing that this is hallucination of research folks.
  2. Small markets don't solve the growth need of large companies:  since there is investors/analysts pressure on each company to grow steadily,  from short term growth considerations, disruptive technologies are not attractive to the organization, not growing it in the short run.
  3. Markets that don't exist cannot be analyzed - when investment require analyst support and hard-core figures, they may not exist
  4. An organization's capabilities define its disabilities:   processes that fit the "business as usual" work, may not be appropriate for developing disruptive technologies
  5. Technology supply may not equal market demands:   companies often don't identify the gaps in their own products, or trying to improve them incrementally, thus expose themselves to disruptive technologies that close these gaps

These five principles are the introduction, the rest of the book deals with methodology for organization to be able to create disruptive technologies.    

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