Read the summary and the most important questions on Meeting the challenge of disruptive innovation

• 1 Introduction

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• Which 3 factors affect what an organization can and can't do?

  1. Resources
  2. Processes
  3. Values

• Which 2 types of values are there?

  • The way companies judge acceptable gross margins: Toyota example
  • How big a business opportunity has to be before it is interesting: Growth rate example

• How do a firm's capabilities and disabilities evolve over time?

  The processes and values will, over time, grow into the company's culture. The factors that define a firm's capabilities and disabilities evolve over time, they start in resources, then move to visible, articulated processes and values, and migrate to culture.

• Two types of innovation

  • Sustaining innovation
  • Disruptive innovation

• Who is most capable of developing sustaining innovation?

  
  Mostly developed and introduced by established industry leaders

• Who is most capable of developing disruptive innovation?

  
  Smaller firms are more capable of pursuing disruptive innovation even when they lack of resources. The strong values of startups are to embrace small markets and accomplish low margins.

• Why are established firms only capable of developing sustaining innovation?

  
  Investment in sustaining innovations fits with the values of leading firms like economies of scale.

• Why are smaller firms more capable of developing disruptive innovation?

  
  They are inconsistent with values of established firms. They promise lower profit margins & not attractive to customers. 

• In which 3 ways can managers create a new organizational space where they can create capabilities to alter/create processes and values?

  1. Create new organizational structures within corporate boundaries in which new processes can be developed
     
  2. Spin out an independent organization from the existing organization and develop within it the new processes and values required to solve the new problem
     
  3. Acquire a different organization whose processes and values closely match the requirements of the new task
     

• How to create new internal capabilities?

  
  

  1. Managers need to pull relevant people out of existing organization and create a new team, called “heavyweight teams”
     
  2. These teams are entirely dedicated to the new challenge, members are physically located together, and each member is charged with assuming personal responsibility for the success of the entire project.