The Innovator's Dilemma: When New Technologies Cause Great Firms
to Fail by Clayton M. Christensen
Introduction
- Christensen introduces the concept of disruptive innovation,
explaining how well-managed companies can fail by doing
everything "right" when they ignore disruptive technologies.
Chapter 1: How Can Great Firms Fail? Insights from the
Hard Disk Drive Industry
- Christensen examines the hard disk drive industry to
illustrate how leading companies lost their market positions by
ignoring disruptive innovations that initially catered to niche
markets.
Chapter 2: Value Networks and the Impetus to Innovate
- This chapter discusses how companies operate within value
networks and how these networks influence the types of
innovations companies pursue. Disruptive innovations often
emerge outside established value networks.
Chapter 3: Disruptive Technological Change in the
Mechanical Excavator Industry
- The history of the mechanical excavator industry is explored
to show how hydraulic technology disrupted the market.
Established firms failed to transition to hydraulic excavators,
allowing new entrants to dominate.
Chapter 4: What Goes Up, Can't Go Down
- Christensen explains the difficulties established firms face
when trying to adopt disruptive technologies, using the example
of the electric vehicle market and the struggles of companies
like General Motors.
Chapter 5: Give Responsibility for Disruptive
Technologies to Organizations Whose Customers Need Them
- The chapter suggests that companies should create separate
organizations to focus on disruptive technologies. This allows
them to develop new markets without the constraints of the
parent company’s existing customers and processes.
Chapter 6: Match the Size of the Organization to the Size
of the Market
- Christensen argues that large organizations struggle with
disruptive innovations because the initial markets for these
innovations are small. He recommends matching the size of the
organization to the size of the opportunity.
Chapter 7: Discovering New and Emerging Markets
- Companies need to learn how to identify and cultivate
emerging markets. Christensen discusses techniques for
understanding and addressing the needs of new customer segments.
Chapter 8: How to Appraise Your Organization’s
Capabilities and Disabilities
- This chapter provides a framework for evaluating a company’s
capabilities and limitations in adopting disruptive innovations,
emphasizing the importance of understanding organizational
strengths and weaknesses.
Chapter 9: Performance Provided, Market Demanded
- Christensen examines the gap between the performance that
disruptive technologies can initially provide and what the
mainstream market demands, suggesting that this gap creates
opportunities for new entrants.
Chapter 10: Managing Disruptive Technological Change: A
Case Study of the Electric Vehicle
- A detailed case study of the electric vehicle industry is
used to demonstrate the principles of managing disruptive
change. Christensen shows how some companies succeeded by
embracing disruptive innovation.
Chapter 11: The Dilemmas of Innovation: A Summary and
Introduction to Part II
- The dilemmas faced by innovators are summarized, setting the
stage for practical strategies to manage disruptive technologies
and innovations.
Chapter 12: Why Good Management Can Lead to Failure
- This chapter revisits the paradox of why good management
practices can lead to failure in the face of disruptive
innovation. Christensen highlights the importance of
adaptability and foresight.
Chapter 13: Choosing the Right Organizational Structure
- Christensen discusses the importance of organizational
structure in managing disruptive innovation, advocating for
flexible and autonomous units within larger firms to focus on
disruptive technologies.
Chapter 14: Leadership and Disruptive Innovation
- The final chapter explores the role of leadership in
fostering an environment that embraces disruptive innovation.
Christensen offers insights on how leaders can guide their
organizations through periods of technological upheaval.
Conclusion
- Christensen concludes by emphasizing the need for companies
to balance sustaining innovations with disruptive ones. He
reiterates that long-term success requires the ability to adapt
to disruptive changes in technology and market demands.