DISRUPTIVE INNOVATION

In today's new age economy one of the term that we quite often hear  is DISRUPTIVE INNOVATION.

This term was first coined by Dr Clayton Christenen, a professor with Harvard Business School. Disruptive Innovation is not a break-through innovation which makes existing good products a lot better for existing customers and are generally are costlier too.

Rather Disruptive Innovation is a  Transformational shift in the product :

which was

a) expensive and also complicated to use allowing it accessible to only few people to use it

b) to a much more affordable and simple to use allowing much larger population to use and derive benefit from .

A disruptive innovation product lifecycle generally starts producing and serving customers at the lowest strata needing basic utilities to medium and finally to the most demanding customers

There is a thin line between Disruptive Innovators and Innovators and we can loosely say that all Disruptive innovators are innovators for sure but the other way round may not be true.    

Not only this , sometimes companies promoting these ideas cannibalize their own products ( like IPhone launch killing IPod and IPad killing Apple Laptops) but it is indispensable as otherwise competition would have killed them.

If we have to look at one of the most widely used such innovation it is Computers which started with Mainframe computers moving to Mini Computers to Desktop , then to Laptop and finally Smart Phones which democratized the way digital technology can be used without any specific skills and at much affordable prices.

Another perfect example can be taken as a computer chip which started at a very high cost and slow speed but moved fast to lesser cost at better performance and now to still improve upon the performance for the most discerning customers .

Classified ads (Craigslist), long distance calls (Skype), record stores (iTunes), research libraries (Google), local stores (eBay), taxis (Uber) and newspapers (Twitter).Netflix , Skype , Hotmail , Mobile phones are some of more examples which fit into this category.

Now if we have to look some of the break through and very successful innovations which we can't call Disruptive are Electric Cars replacing gasoline cars , Mobiles replacing  ocean liners replaced by jets, break bulk freighters by container ships, land line phones by cellular phones, disk databases by in memory databases

The 5 most successful companies which succeed due to their disruptive innovative products they are Apple , Google , Facebook , Netflix and Airbnb.

Some of the products and companies producing them lost out due to these out of the box thinking innovators are Kodak ( to digital photography cost of developing and hassles of storage) , Nokia & RIM ( to smartphones with email and other seamless connectivity features at much cheaper prices) , Fax/Telex to e-mails , scanned documents etc.