Reflection on “Disruptive Technologies”

The Harvard Business Review article “Disruptive Technologies: Catching the Wave” by Joseph L. Bower and Clayton M. Christensen is one of the most useful articles I’ve read pertaining to the rise of successful new technologies. Despite being written in 1995, the material is just as relevant today as it was 14 years ago.

 

Several take-aways can be gained from the article. One key learning is the overall importance of technology executives knowing how their market operates. The most successful response to new technology is not an inherent one. While it is safe to stay close to a company’s tried and true products, this is where corporate downfall often happens. Rather than keeping an eye out for emerging trends and technologies, companies often listen to their customers who simply like what they already have. From this, companies believe that customers don’t want new technologies. However, when a new technology is introduced that more efficiently meets market demand, customers will follow.

 

Although Bower and Christensen focused their article on the disk drive industry, modern examples came to mind as I read. I found similarities between the creation of Apple’s iPhone, Google’s G-phone and Microsoft’s Zune and X-box when reading. The authors state that “the leading, established companies have consistently led the industry in developing and adopting new technologies that their customers demanded – even when those technologies required completely different technological competencies and manufacturing capabilities from the ones the companies had” (p. 45). These modern examples identify companies that have diverged from their initial specialties to stay current with trends and demand.

 

The discussion of hard-disk-drives evolving to become “smaller size and low-cost” was also evocative of current technology. It mirrors the development of technologies such as cell phones and computers which continue to become more compact and more affordable.

 

I also saw similarities between the article and the technology adoption cycle followed by Tom Standage in “The Victorian Internet.” When sound was added to the telegraph process, consumers were skeptical and thought it was a superfluous addition to a tool that already met their needs. Bower and Christensen describe the same concept: “As a rule, mainstream customers are unwilling to use a disruptive product in applications they [already] know and understand” (p. 45). From this, it can be taken-away that customers are not always right and don’t necessarily know what they want!

 

I found it very interesting to read the authors’ ideas on not listening to customers when looking to enter new markets. The authors note the importance of listening to techies, not financial managers, when making innovative decisions. It makes sense for such businesses to turn to start-ups for insights and outside perspectives. If successful, the corporation can acquire the start-up. Overall, the most important take-away is summarized with: “For the corporation to live, it must be willing to see business units die” (p. 53). The sink or swim factor is placed on a company’s ability to remain agile and malleable with market trends and new innovations – in contrast to strict adherence to past successes.