Harness the Power of Disruptive Innovation to Craft Winning Strategies

We always tell students that it is not good to start an argument, for example, to write a research paper in a master’s course, asking a question. But in reality, in doctrine, the authors and experts always end up enlightening us with new works, investigations and discoveries, after asking themselves dozens and dozens of questions. Even in the works themselves in which one or more authors synthesize the main lines of their contribution.

It is obvious that the implementation of any disruptive strategy has to take into account the innovation that is taking place in that field of knowledge. But if we go to the concept of disruptive innovation that Clayton Christensen (1952-2020) coined, it has to do with the skills and techniques to develop a strategy at the executive level, organize for innovation and determine what actions must be implemented. For Christensen, a disruptive technology or innovation is one that ends up ending an established market following patterns.

In 2009, Martha E. Mangelsdorf, editorial director of MIT Sloan Management Review, wrote an article in Harvard Deusto entitled “Clayton Christensen:” These are good times for disruptive innovation “”. Obviously the statement “these are good times for disruptive innovation” is from Christensen, from which Mangelsdorf articulates her reasoning and conducts an interesting interview with her. She refers to the fact that Clayton M. Christensen always wanted to do things in a big way, based on the fact that an era was going through in which academics used to focus incessantly on a narrow area of ​​specialization.

But Christensen, who was the Robert and Jane Cizik Chair of Business Administration at Harvard Business School, was looking for new fields in which to apply his thinking. And he had put him to the test as the author of a series of highly influential books on innovation, including “The Innovator’s Dilemma” and “The Innovator’s Solution”, but most notably, he had made a reputation and prestige for his theory of disruptive innovation, which describes how new technologies (and the companies that introduce them) can displace established ones.

Mangelsdorf claimed in 2009 that Christensen had also applied his ideas about disruptive innovation to public education and healthcare. In relation to the impacts that the International Financial Crisis of 2008-2009 was going to have on organizations, Christensen responded to the editor that he believed it would have an absolutely positive effect on innovation, since it would force innovators not to waste so much money.

For this reason, we found his thinking interesting as he clearly refers to the fact that “one of the nightmares of successful innovation is that companies must be so committed to innovation that they will provide innovators with a large amount of money to invest . And, statistically, 93% of all the innovations that have been successful lately started going in the wrong direction.

Christensen was adamant that the probability of being successful the first time is very low. Therefore, he offers them the privilege of continuing to implement the wrong strategy for a long time. And in an environment where you need to drive innovation fast and keep innovation costs low, the likelihood of your innovation being successful is actually much higher. For this reason, the center of his thought goes by saying that “prosperity tends to isolate innovators from the realities of the market and allows them to carry out the vision of it, a vision that is probably wrong, in statistical terms”.

Christensen once graduated from university began working as a consultant and later founded a technology company with several professors from MIT. During those years, the theory that he was going to discover took shape in his thinking, because he was a born observer, asking the environment for explanations of the things that were happening around him and that had no explanation, or that, in his opinion, had been very poorly explained. He observed that when companies failed, the explanation that was frequently given was that the failure was attributed to the fact that the responsibility passed through their managers (who had not been effective enough to react to the challenge), but for him that this was given an excuse when it came to prepared and intelligent professionals, since it did not match the reality of the environment, he was convinced that there had to be a different answer.

Thus was born the central idea of ​​his most famous book, The Innovator’s Dilemma (1997), in which he argues that those executives failed by following two guidelines that were taught in business schools: listen carefully to their best clients and invest only in the improvements that promised the highest returns. But this strategy suffered from a mistake: it focused on improving the offering, but ignoring the threat of initially inferior products, but cheaper and easier to use. So, as those products improved, they ate market share from large companies, which still did not change their focus. And this is what Christensen defined as disruptive innovation and detected it in the problems of hundreds of companies from different sectors.

The prestigious weekly “The Economist” defined his theory as the most influential management idea of ​​the 21st century. And it was in his 2003 work “The Innovator ‘s Solution” that he expanded and refined his theory by explaining that a company should not pay attention to its products but to its customers and the everyday problems they solve by using those products it focuses on the wrong or correct competition to compete not only with similar products but with other products from other competitors that solve the same problems. That is why we have started by saying that we must take advantage of the power of disruptive innovation, because in itself, it has a double impulse for organizations that resist and sustain themselves in the market: it makes them more efficient by focusing on where the changes come from of the consumer who finds offers of products and services that until that moment were unknown in the market and suddenly, a new way of providing a certain service and product emerges that breaks with the conventional.

The clearest example we have with the fight of taxis against Uber in Spain, because it did not take into account, among other things because it was a monopoly sector, the possible service improvement that the innovation itself (technological and social) put to provision of a service seeker who valued price, comfort, cleanliness, image and a long etcetera.

Disruptive innovation is not a conventional theory (what Christensen did was translate into doctrine what was happening in daily reality), but a new frame of reference. Let’s say it changed the paradigm that we believed in until its discovery, innovation worked. Disruption is not linear, but is irregular, capricious and especially destructive towards rigid positions, which ignore the reality of the market, in particular, the existence of what is known as a market of specialists who have competed as equals with large organizations, because they had knowledge and gave an exact answer to the new needs that innovation was giving to that market.

Antonio Alonso, president of the AEEN (Spanish Business School Association) and general secretary of EUPHE (European Union of Private Higher Education)