Disruption vs innovation
1. Disruption displaces, innovation doesn’t
Disruptors are innovators but not all innovators are disruptors. To put it another way, disruption is a subset of innovation. Innovation is the creation of something new. Disruption is the creation of something new that displaces the old. Innovation can be incremental and inclusive. Disruption cannot because disruption demands that the incumbent be unseated.
2. Disruption begins with customers overlooked by the incumbent
Father of the term “disruption” and Harvard Business School professor, Clayton M Christensen, defines disruption as the process by which a smaller company with fewer resources is able to successfully challenge established incumbent businesses. This usually happens when incumbents concentrate on only a sector of customers while overlooking others. A newcomer enters the fray, offering these overlooked customers a solution, often at lower prices. When the newcomer is able to capture even the mainstream customers while still maintaining its previous advantages over the incumbent, the newcomer becomes a disruptor.
3. Disruption originates in low-end or new markets
But Clayton cautions against being too hasty to slap on the “disruptor” title. Not any situation in which an industry is shaken up and previously successful incumbents are stumbled can be considered a disruption. Disruption originates in low-end or new-market footholds.
A disruption, then, is more than just innovation gone rogue. For an innovation to be considered a disruptive innovation it has to do more than wrestle something from the incumbent. It has to create a new market and value network that displaces established market leading firms, products and alliances.
“So what?” says the start-up?
Why should all this matter to the start-up?
1. So you can insure your start-up
If you are in an industry vulnerable to disruptions, you need to identify what might be shaken down so you will not be taken down when the disruption happens.
2. So you can find an inroad
If you are in an industry that is ready for disruption, you have a stronger chance of moving from the fringe to the mainstream. Disruptors can pave the way for start-ups.
3. So you can know where you stand
The axiom “disrupt or be disrupted” can be misleading. Start-ups are necessarily innovative by definition. They need not be disruptive. Knowing the difference will help you decide which you want to be.
Disruptors typically concentrate more on their business model than their product. Case in point: the iPhone. When it first came onto the market, it was innovative because it was a better product than other smartphones. But, it was not disruptive. It didn’t target a new market. It was targeting smartphone users. Then, it adapted its business model to create a network connecting app developers with phone users.
That was when the iPhone began to challenge laptops as another way to access the Internet. That was also when it became a disruptor by offering mainstream users another way to go online. The change from innovator to disruptor was the result of a different business model.
Disruptor or innovator, the key to success in any business is staying ahead of the competition. If knowledge is power, understanding the difference between disruption and innovation will go some way to shaping your response to competition.
Disruption vs Innovation – What's the Difference?
Disruption vs innovation