| Innovations
fuel economic growth and prosperity.
Continuous, incremental
innovations provide enhancements to existing products or processes.
The latest version of a software product may incorporate
incremental innovations.
Discontinuous, disruptive or radical innovations fundamentally change the way
we do something. The inventions of moveable type, the
telegraph, the computer, the internet and the mouse are all discontinuous innovations.
Prosperity depends on both kinds of innovation,
and each kind requires different organizational capabilities.
Here we will focus primarily on disruptive innovations.
Disruptive innovations provide
threats
to some businesses and opportunities for others. Some of
the market behaviors are well-understood and fairly predictable.
Managers need to understand those behaviors in order to succeed
during a disruptive innovation.
Waves of technology
Disruptive innovations create technology waves. Successive waves
start out with a simpler technology, which improves in performance,
features or functionality over time. And successive waves
have increasingly larger market sizes.
In the computer industry over the last 30 years, we have been
through successive waves of technology.
What will be next?
The role of standards
Understanding the role of standards is critical to success in
a changing marketplace. When a standard emerges, whether
de facto or regulated, an industry experiences rapid growth.
Until the IBM PC standard emerged, the industry remained small.
PCs were dismissed as toys. The infrastructure to support
the industry remained small.
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Automobiles presented a threat to the horse
and carriage industry and an opportunity for Ford.
Calculators presented a threat to slide
rule makers and an opportunity for Hewlett-Packard and Texas
Instruments
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Technology, commerce, and standards are three forces that come together
to drive tremendous growth. If your company is driving technology,
you need to understand the tools to drive de facto standards.
The role of infrastructure
Disruptive innovations as "toys"
Overshooting the market
Value networks
Characteristics of different stages
Which stage is your company in?
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