The Current

'Disruptive innovation' theory often misunderstood, says creator Clayton Christensen

Back in the '90s Clayton Christensen developed the business theory of "disruptive innovation" and watched as the Blackberry disrupted the laptop and then became disrupted by Apple. Our series The Disruptors looks at the theory that is often misunderstood.
(Courtesy of Clayton Christensen)

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Disruption and innovation have become buzzwords, particularly in the world of business. And a large part of the reason behind that is Harvard Business School professor Clayton Christensen's theory of disruptive innovation, which he wrote about in his 1997 book The Innovator's Dilemma.

"The questions that the theory emerged to explain are, why is success so hard to sustain?" Christensen tells The Current's Anna Maria Tremonti,

"Why is it that entrant companies can displace incumbent leaders?"

The answer lies in the direction of attack.

Disruptive product knocks out competition

While the incumbent companies are constantly improving their products and moving upmarket, a disruptive innovator can sneak in from the low end. They target consumers who can't afford what's currently on the market, but are happy to buy something simple even if it's not as good.
Clayton Christensen says the Apple II computer is an example of disruptive innovation — starts out simple and then as the disruptive product gets better, knocks out the competition. (Marcin Wichary, Flickr cc)

Established companies don't initially view the disruptor as a threat, since the cheap product doesn't interest their existing customers. But as the disruptive product gets better, it can knock out the high end competition.

Christensen cites personal computers as an example.

"Personal computers at the beginning were very simple," he says. "In fact Apple, their Apple II computer was sold as a toy to children ... Then the technology got good enough that people realized, we can use this personal computer for complicated problems, and all of the companies that made mainframe computers got killed."

Disruptive innovation theory not just for business

But the popularity of the term disruptive innovation has meant that not everyone who uses it understands Christensen's theories.

"I have mixed feelings," says Christensen. "I'm glad that it's had a big impact, but I wish that it would be unambiguously applied."

Christensen believes his theory doesn't only work in business and management, however. He discusses how it can be applied in everything from relationships to religion to defence. In fact, he sees terrorism as a threatening form of disruptive innovation, against our defense systems that are set up to fight the established threat through conventional warfare.

"Terrorism is at the bottom of the market," says Christensen. "These are technologies that allow you in simple ways to do simple things."

"And there isn't anything about the way we are organized to defend ourselves that makes us good at stopping terrorism."

Listen to full segment.

This segment was produced by The Current's Karin Marley.