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ContentsIn GratitudeIntroductionPART ONE: WHY GREAT COMPANIES CAN FAIL1 How Can Great Firms Fail? Insights from the Hard Disk Drive Industry2 Value Networks and the Impetus to Innovate3 Disruptive Technological Change in the Mechanical Excavator Industry4 What Goes Up, Can’t Go DownPART TWO: MANAGING DISRUPTIVE TECHNOLOGICAL CHANGE5 Give Responsibility for Disruptive Technologies to Organizations Whose Customers Need Them6 Match the Size of the Organization to the Size of the Market7 Discovering New and Emerging Markets8 How to Appraise Your Organization’s Capabilities and Disabilities9 Performance Provided, Market Demand, and the Product Life Cycle10 Managing Disruptive Technological Change: A Case Study11 The Dilemmas of Innovation: A SummaryThe Innovator’s Dilemma Book Group GuideAbout the Author4
Although this book lists only one author, in reality the ideas it molds together were contributed andrefined by many extraordinarily insightful and selfless colleagues. The work began when ProfessorsKim Clark, Joseph Bower, Jay Light, and John McArthur took the risk of admitting and financing amiddle-aged man's way into and through the Harvard Business School's doctoral program in 1989. Inaddition to these mentors, Professors Richard Rosenbloom, Howard Stevenson, Dorothy Leonard,Richard Walton, Bob Hayes, Steve Wheelwright, and Kent Bowen helped throughout my doctoralresearch to keep my thinking sharp and my standards for evidence high, and to embed what I waslearning within the streams of strong scholarship that had preceded what I was attempting to research.None of these professors needed to spend so much of their busy lives guiding me as they did, and I willbe forever grateful for what they taught me about the substance and process of scholarship.I am similarly indebted to the many executives and employees of companies in the disk drive industrywho opened their memories and records to me as I tried to understand what had driven them in theparticular courses they had taken. In particular, James Porter, editor of Disk/Trend Report, opened hisextraordinary archives of data, enabling me to measure what has happened in the disk drive industrywith a level of completeness and accuracy that could be done in few other settings. The model of theindustry’s evolution and revolution that these men and women helped me construct has formed thetheoretical backbone for this book. I hope they find it to be a useful tool for making sense of their past,and a helpful guide for some of their decisions in the future.During my tenure on the Harvard Business School faculty, other colleagues have helped refine thisbook’s ideas even more. Professors Rebecca Henderson and James Utterback of MIT, RobertBurgelman of Stanford, and David Garvin, Gary Pisano, and Marco Iansiti of the Harvard BusinessSchool have been particularly helpful. Research associates Rebecca Voorheis, Greg Rogers, Bret Baird,Jeremy Dann, Tara Donovan, and Michael Overdorf; editors Marjorie Williams, Steve Prokesch, andBarbara Feinberg; and assistants Cheryl Druckenmiller, Meredith Anderson, and Marguerite Dole, havelikewise contributed untold amounts of data, advice, insight, and work.I am grateful to my students, with whom I have discussed and refined the ideas put forward in thisbook. On most days I leave class wondering why I get paid and why my students pay tuition, given thatit is I who have learned the most from our interactions. Every year they leave our school with theirdegrees and scatter around the world, without understanding how much they have taught their teachers.I love them and hope that those who come across this book will be able to recognize in it the fruits oftheir puzzled looks, questions, comments, and criticisms.My deepest gratitude is to my family—my wife Christine and our children Matthew, Ann, Michael,Spencer, and Catherine. With unhesitating faith and support they encouraged me to pursue my lifelongdream to be a teacher, amidst all of the demands of family life. Doing this research on disruptivetechnologies has indeed been disruptive to them in terms of time and absence from home, and I amforever grateful for their love and support. Christine, in particular, is the smartest and most patientperson I have known. Most of the ideas in this book went home on some night over the past five yearsin half-baked condition and returned to Harvard the next morning having been clarified, shaped, andedited through my conversations with her. She is a great colleague, supporter, and friend. I dedicate thisbook to her and our children.5
Page 2 and 3: TheInnovator’sDilemmaWhen New Tec
Page 6 and 7: Clayton M. ChristensenHarvard Busin
Page 8 and 9: Digital Equipment Corporation creat
Page 10 and 11: they lose their positions of leader
Page 12 and 13: Disruptive Technologies versus Rati
Page 14 and 15: understand what has caused those ci
Page 16 and 17: Chapter 7 discusses a different app
Page 18 and 19: But the electric car is a disruptiv
Page 20 and 21: Part OneWHY GREAT COMPANIESCAN FAIL
Page 22 and 23: was the size of a large refrigerato
Page 24 and 25: To test this hypothesis, I assemble
Page 26 and 27: Figure 1.5 describes a sustaining t
Page 28 and 29: Source: Data are from various issue
Page 30 and 31: Between 1978 and 1980, several entr
Page 32 and 33: The 3.5-inch drive was first develo
Page 34 and 35: Figure 1.8 Leadership of Entrant Fi
Page 36 and 37: Rigid Disk Drive Industry: A Histor
Page 38 and 39: CHAPTER TWOValue Networks and theIm
Page 40 and 41: toward sustaining innovations and a
Page 42 and 43: how each value network exhibits a v
Page 44 and 45: structure. Research, engineering, a
Page 46 and 47: Figure 2.5 The Conventional Technol
Page 48 and 49: firms’ decision-making processes
Page 50 and 51: annually introduced as a percentage
Page 52 and 53: ecause they have no moving parts, t
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Figure 2.7 Improvements in Areal De
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IMPLICATIONS OF THE VALUE NETWORK F
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esident in companies today result f
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CHAPTER THREEDisruptive Technologic
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Source: Data are from the Historica
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Because their capacity was so small
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was thus a hybrid of the two techno
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Source: Data are from the Historica
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its archives, and Toth and Haddock
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CHAPTER FOURWhat Goes Up, Can’t G
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challenges of their competitors. Gr
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organization’s middle managers pl
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Managers in disk drive companies we
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Minimill steel making first became
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Once their position in the market f
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Indiana, in 1989, and constructed a
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Part TwoMANAGING DISRUPTIVETECHNOLO
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The sum of these studies is that wh
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want? One option is to convince eve
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engineering workstations, and has a
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those laws, people flew quite succe
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The first discount store was Korvet
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expansion in the regular variety st
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laser jet division is headed, will
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CHAPTER SIXMatch the Size of theOrg
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What benefit, if any, did leadershi
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Source: Data are from various issue
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Finally, there is substantial evide
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Because emerging markets are small
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There are many success stories to t
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This recommendation is not new, of
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13. “Can 3.5" Drives Displace 5.2
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data, Disk/Trend Report, published
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MB, and a second model, introduced
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to make small deliveries to local c
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Japanese semiconductor manufacturer
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powerful deterrent to the movement
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therefore, may view creation of new
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ResourcesResources are the most vis
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its Corona model—a product target
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go public based upon a hot initial
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such success in the minicomputer bu
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they made these acquisitions late a
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Figure 8.1 Fitting an Innovation’
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structured. For Compaq, Hewlett-Pac
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CHAPTER NINEPerformance Provided,Ma
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Specifically, in the desktop person
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A product becomes a commodity withi
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1. The Weaknesses of Disruptive Tec
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Scott Cook, Intuit’s founder, sur
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CONTROLLING THE EVOLUTION OF PRODUC
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Source: An earlier version of this
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originally developed by Venetian me
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The first step in making this chart
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Having decided that electric vehicl
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its braking distance longer than ot
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The major automakers engaged in ele
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customers who pay the present bills
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Clearly, as will be discussed below
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CHAPTER ELEVENThe Dilemmas of Innov
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Seventh, and last, the research sum
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develop those technologies themselv
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2. There is a tendency in all marke
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