Are You Ready for Digital Disruption?
Author: Josh Bernoff
Josh Bernoff is senior vice president of idea developmentat Forrester Research in Cambridge, Mass. He is the co-author of Empowered: Unleash Your Employees, Energize Your Customers, and Transform Your Business and Groundswell: Winning in a World Transformed by Social Technologies, both published by the Harvard Business Review Press. Groundswell was named book of the year by the AMA in 2009.
Imagine, for a moment, that there are no barriers to entry in your business. Competitors large and small are free to come in and compete with you from all directions. What would you do differently? This is the world we all live in now.
Clay Christensen, the renowned professor from Harvard Business School, made us all aware of disruptive innovation more than 10 years ago in his book, The Innovator’s Dilemma. The concept is simple, if a bit scary to established companies: Technology allows people to create alternatives to existing products. These alternatives are typically cheap and low-quality, and it’s not worth it for established companies to compete with them. They succeed at the low end of the market and then move upmarket. The established companies remain paralyzed, their margins threatened, as the new competitor eats into their business. In markets like disk drives and excavation equipment, Clay vividly showed the pattern and he has now extended the analysis into industries from health care to education.
As a result of his work, companies are now especially vigilant, looking for competition from upstarts and attempting to face up to it, despite the typical big-company obstacles.
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