Incumbents and Disruptive Change
What makes established firms vulnerable?
- changes in external environment
- strategic actions by competitors
- internal organizational challenges
changes in external environment
- technology, shifting consumer needs, laws and regulations
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strategic actions by competitors
- imitation, innovation, substitution
internal organizational challenges
- inertia, competency traps, mental models, etc
disruptive innovation model - clayton christensen
as companies attempt to continue to capture more and more consumers, they neglect their
previous low end consumers to capture more higher end consumers
- disruptor goes after lower end of the market with a worse product, then tries to take over
mainstream and overtake incumbents
information action paradox
, start ups make decisions quicker (with less data and more freedom)
incumbents wait for more data, thus experiencing less freedom as new entrants make decisions
myths of digital disruption
- every sector is under threat
- disruption happens quickly and is accelerating
- established firms are struggling to adapt
every sector is under threat
- only some sectors are (tech, media, telecom)
- other sectors are relatively stable (incumbents tend to stick around for a long time)
disruption happens quickly and is accelerating quickly
- disruption happens over a long period of time
established firms struggle to adapt
- there are standalone companies that struggle but the struggle is not a general rule
adaptation strategies for incumbents
- Christensen and Overdorf
- Adner and Kapoor
- information and time paradox
- birkinshaw
christensen and overdorf
how to organize for innovation?
Christensen and Overdorf questions
when faced with disruption and need to innovate, ask:
1. Does my organization have the right resources to support this innovation?
2. Does my organization have the right processes to innovate?
3. Does my organization have the right values to innovate?
4. What team and structure will best support our innovation effort?
1. Does my organization have the right resources to support this innovation?
Resources, capabilities, value chain
What makes established firms vulnerable?
- changes in external environment
- strategic actions by competitors
- internal organizational challenges
changes in external environment
- technology, shifting consumer needs, laws and regulations
Previous
Play
Next
Rewind 10 seconds
Move forward 10 seconds
Unmute
0:15
/
0:15
Full screen
Brainpower
Read More
strategic actions by competitors
- imitation, innovation, substitution
internal organizational challenges
- inertia, competency traps, mental models, etc
disruptive innovation model - clayton christensen
as companies attempt to continue to capture more and more consumers, they neglect their
previous low end consumers to capture more higher end consumers
- disruptor goes after lower end of the market with a worse product, then tries to take over
mainstream and overtake incumbents
information action paradox
, start ups make decisions quicker (with less data and more freedom)
incumbents wait for more data, thus experiencing less freedom as new entrants make decisions
myths of digital disruption
- every sector is under threat
- disruption happens quickly and is accelerating
- established firms are struggling to adapt
every sector is under threat
- only some sectors are (tech, media, telecom)
- other sectors are relatively stable (incumbents tend to stick around for a long time)
disruption happens quickly and is accelerating quickly
- disruption happens over a long period of time
established firms struggle to adapt
- there are standalone companies that struggle but the struggle is not a general rule
adaptation strategies for incumbents
- Christensen and Overdorf
- Adner and Kapoor
- information and time paradox
- birkinshaw
christensen and overdorf
how to organize for innovation?
Christensen and Overdorf questions
when faced with disruption and need to innovate, ask:
1. Does my organization have the right resources to support this innovation?
2. Does my organization have the right processes to innovate?
3. Does my organization have the right values to innovate?
4. What team and structure will best support our innovation effort?
1. Does my organization have the right resources to support this innovation?
Resources, capabilities, value chain
