Sustaining v Disruptive Technologies
- sustaining tech are improvements that sustain a company’s focus, goals, and customers.
- Generally these products underperform establish products in mainstream markets.
- Cheaper, simpler, smaller, more convenient. (Dimensions: functionality, reliability, convenience, price)
- The attributes that often make the distruptive technology worthless in mainstream markets often become strong selling points in emerging markets.
- Do not improve the focus of the company. A market must be developed and new customers found.
- Ignore the mainstream market. Find a market that values the disadvantages of the distruptive technology.
- Neither the firm nor the customers know of distruptive tech can be used.
- managers need to plan to learn and discover, not plan and execute bc markets are unknowable.
- cannot rely on new breakthrough technology, it is usually combining existing tech in a new way.
Being a follower in sustaining technologies is a viable and possibly desirable strategy, but leadership in disruptive technology creates enormous value. (Ch 6)
Match the size of the organization to the size of the market. Implant projects aimed at commercializing disruptive innovations small enough to get excited about small market opportunities. (Ch 6)
- Johnson and Johnson is comprises of 160 automonous companies each of which can introduce distuptive products.
small markets don’t solve growth needs of big companies. For disruptive technologies, markets are unknowable.
look at the performance improvement of new technology. If it is growing faster than market performance demand, then it can be distruptive (it will eventually intersect the market need curve). (Ch 10)
- Managing innovation is a mirror image of managing the resource allocation process.