Theories of innovation in management and marketing - Theory of disruptive innovation
3 important questions on Theories of innovation in management and marketing - Theory of disruptive innovation
Theory of disruptive technology performance; time, start of the new technology point 1 figure
- New technology initially underperforms
- Lead customers of incumbant companies are not interested
- New technologies are first commercialized in small or emerging markets
Theory of disruptive technology; time, start of the new technology point 2 figure lines cross single crossing
- New technology improves and meets standsards of old technology
- New technology displaces the dominant one
- New entrant displaces dominant incumbant in mainstream market
What are the implications of disruptive technology theory
- New technologies are introduced by new entrants that initially focussed on smaller niche markets where the new technology
can be developed further
- They may take-over the mainstream market after some time
- Large incumbent companies make rational decisions in that they follow lead customers but may loose in the long run if they
blindstare on old technologies
- Profitable investments in new technology start at inflinction point (meting out something unpleasant)
- Mainstream companies may acquire companies that own the new technology at or just before that point
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