1. Disruptive technology influenced the global market a lot even though proposed simple, cheaper, and lower performance products. Evidently, the value proposition also changed when some disruptive technologies appeared. There are enough facts that prove that such technologies took over the older markets after having being improved (Christensen, M. Clayton n.pag.). No doubt, sufficient investments and new ideas are necessary to succeed and expand the market. It happened times ago and remains nowadays when a fresh performance is accomplished. Obviously, it should satisfy the requirements and needs of customers because, above all, they tend to direct the success of some products in the market. All principles of disruptive technology stated by Clayton M. Christensen are very important to understand. Especially it concerns the principle regarding the highest value of customers and investors’ resources to develop a good business. In addition, according to many researchers, disruptive technologies are able to occupy only small markets. However, they are also popular in a big market. Since customers sometimes cannot absorb something more sophisticated from other technologies, then performance of disruptive technologies seems to be good enough for them (Christensen, M. Clayton & Overdorf, D. Michael n.pag.). There are several samples of the older products’ replacement by disruptive technologies. For instance, transistor radio that had worse sound later became portable and popular among teenagers who took it to the beach. Being improved, it also displaced an analogue radio which was quite big. Pocket calculator that had worse computing performance became much more improved and took smaller parameters. Over the years, their price has become much cheaper, and portable calculators absolutely occupied the market. LCD TV had worse image quality at the beginning, but then its size and quality were improved and such TV replaced CRT TV in the 2000s (Sandstrom n.pag.).
2. Obviously, in order to be a profitable company, it is necessary to present interesting products of a high quality. At the same time, all aspects concerning business environment, customers’ needs, and prices should be highly taken into account. It is much more difficult to take a leading position in the market with simple, cheaper products that do not have a very striking performance. Moreover, it does not mean that disruptive technologies are not able to cope with customers’ needs and become profitable for company. According to Christensen & Overdorf, “this means that disruptive technologies that originally underperform what the mainstream market needs can become fully performance competitive in those markets over time” (Christensen & Overdorf n.pag.) . On the other hand, sustaining technologies outline not only better performance of products and their higher prices but also characteristics historically preferred by customers (Christensen, M. Clayton & Overdorf, D. Michael n.pag.). In fact, it would be important to utilize valuable things for customers in new products of reasonable prices. The natural process is that cheaper and simpler disruptive products do not involve greater profits, but only lower margins, unfortunately. Simultaneously, one of the biggest difficulties regarding movement upmarket with non-complicated products is bad resource allocation process. It means that when this process is violated, it becomes hard to set back the proposals denied by customers. Consequently, customers do not help to extend margins of the company. Evidently, effective resource-allocation processes tend to show such disruptive innovations that are no longer required by customers and prevent undesirable outcomes in the market. One more thing is that generally being a leader in disruptive technologies takes often much more efforts than in sustaining technologies. Actually, such leadership builds great value (Christensen, M. Clayton & Overdorf, D. Michael n.pag.). In addition, many companies are used to be followers in terms of disruptive innovation because a wide range of such innovations regards markets that have become small to satisfy scopes and needs of large organizations. Hence, when they continue to grow, they are less willing to enter emerging markets.
3. In fact, the success of a company and its growth in major depends on management. It means that all managers within the company should understand the high importance of disruptive technologies or, at times, their less importance. The idea of leadership should be effectively spread among all managers with their peculiar responsibilities. According to Christensen & Overdorf,
…good management-listen to the best customers, invest when profit margins are greatest, and target large market opportunities-are the root causes of established companies’ consistent ability to sustain technological innovations and their inability to cope with disruptive technologies (Christensen & Overdorf n.pag.).
Contemporary organizations tend to follow such strategy that would be able to involve into the development process not only the most responsible people but also some occupying organizations’ midlevel. Hence, each organization has its own capabilities as an independent establishment. The task for senior managers is to consistently grow up and succeed. It is possible when managers on all levels have enough skills for training, choosing, and motivating the right people for the right positions. It is also important to create and work on special preparation of an organization for some kind of production making (Christensen, M. Clayton n.pag.). It remains important to understand the corporate climate within the organization, which may influence the decisions of midlevel managers concerning disruptive technologies. According to Christensen, there are several important statements for midlevel managers to follow: to direct resources correctly (to make disruptive technologies available for customers that need such technologies), develop separate institutions small enough to get thrilled by small profit, be ready to failure, because it can happen at the beginning. Commercializing of disruptive technology should be used for learning opportunities, namely to find a market for disruptive technologies even if it may look impossible because of such technologies’ unattractiveness. Sometimes those principles may be neglected because of many factors including too vivid subordination within organization. At the same time, such an important leader-employees-customers chain is often violated. Accordingly, the tendency to management leadership is predominant at every stage.
4. The idea of Professor Christensen is worth discussing because it helps managers become more initiative, creative, and proactive. First of all, according to his paradigm, the necessary actions must be applied to find a market or expand it (Christensen, M. Clayton n.pag.). However, a lot depends on the type of products. According to Christensen and Overdorf, …generally, in the case of sustaining technologies, plans must be made before action is taken, and before forecasts can be accurate and customer inputs can be reasonably reliable. Careful planning followed by aggressive execution is the right formula for success (Christensen & Overdorf n.pag.).
At the same time, when the situation touches disruptive technologies, managers develop plans mostly “for learning rather than implementation” (Christensen, M. Clayton & Overdorf, D. Michael n.pag.). Evidently, in such a case, actions go before planning. Since it is not always safe to rely on breakthrough, different products of lower performance and prices may also be effectively distributed among particular category of consumers. In order to take up the action, a manager should know the demands of a concrete market. If they are different, it is better to find an additional circle of partners who may lead a manager to a new market with suitable requirements. No doubt, there are enough people who are used to try the same things and products repeatedly. In addition, they are willing to save their money and be satisfied with improved quality, even though performance is not so much sophisticated as in sustaining technologies. When some kind of products does not match customers’ needs, it will be fruitless to aggressively put it in the market. It would be much better to find another market or simply improve the products and then present them to customers.
Christensen, M. Clayton. The Innovators Dilemma. Harvard Business Review Press, 2007.
Christensen, M. Clayton & Overdorf, D. Michael. A Word to Instructors of InnovationManagement. n.p., 2000. Web. 9 Oct.2013.
Sandstrom, Chris. 5 examples of disruptive innovation. n.p., 18 Feb. 2010. Web 9 Oct. 2013 .