For the past 20 years, the theory of disruptive innovation has been
enormously influential in business circles and a powerful tool for
predicting which industry entrants will succeed. Unfortunately, the
theory has also been widely misunderstood, and the “disruptive” label
has been applied too carelessly anytime a market newcomer shakes up
well-established incumbents. In this article, the architect of
disruption theory, Clayton M. Christensen, and his coauthors correct
some of the misinformation, describe how the thinking on the subject has
evolved, and discuss the utility of the theory. They start by
clarifying what classic disruption entails—a small enterprise targeting
overlooked customers with a novel but modest offering and gradually
moving upmarket to challenge the industry leaders. They point out that
Uber, commonly hailed as a disrupter, doesn’t actually fit the mold, and
they explain that if managers don’t understand the nuances of
disruption theory or apply its tenets correctly, they may not make the
right strategic choices. Common mistakes, the authors say, include
failing to view disruption as a gradual process (which may lead
incumbents to ignore significant threats) and blindly accepting the
“Disrupt or be disrupted” mantra (which may lead incumbents to
jeopardize their core business as they try to defend against disruptive
competitors). The authors acknowledge that disruption theory has certain
limitations. But they are confident that as research continues, the
theory’s explanatory and predictive powers will only improve. [ABSTRACT
FROM AUTHOR]