Disruptive Genius: Clayton Christensen on spreading his gospel, the Gospel, and how to win with the electric car

Craig Lambert in Harvard Magazine:

Dominant companies prosper by making a good product and keeping their customer base by using sustaining technologies to continue improving it. The products get ever better—but at some point their quality overshoots the level of performance that even the high end of the market needs. Typically, this is when a disruptive innovation lands in the marketplace at a lower price and relatively poor level of performance—but it’s a level adequate for what the lower end of the market seeks. The disruptive technology starts to attract customers, and is on its way to staggering the industry’s giants.

Examples abound. Small off-road motorcycles from Honda, Kawasaki, and Yamaha disrupted the hegemony of large, powerful bikes from Harley-Davidson and BMW. Transistors overthrew vacuum tubes. Discount retailing and home centers savaged the dominance of Sears. Online courses are barging into higher education. Drones challenge manned fighters and bombers. Nurse practitioners underprice medical doctors. Digital photography eclipsed film, and mobile telephones are replacing landline service. Outpatient clinics and in-home care pull revenue away from general hospitals. Consider the hegemony of Detroit’s Big Three—General Motors, Ford, and Chrysler. At one time, they dominated the auto industry, producing bigger, faster, safer, more comfortable cars with more and more features. But these improving products also “create a vacuum underneath them,” Christensen says, “and disruptive innovators suck customers in with fewer features and a cheaper price.” Toyota, Honda, and Nissan disrupted the Big Three’s marketplace by introducing smaller, lighter, less safe, and less comfortable but reliable cars that needed few repairs and got good gas mileage—at a significantly lower price. Within a few years, they had garnered a large share of the market. Says Christensen: “The leaders get killed from below.”

More here.