disruption theory 2.pdf - Keep Calm and Manage Disruption SPRING 2016 Just whisper the word \u201cdisruption\u201d if you want to scare the life out of many

disruption theory 2.pdf - Keep Calm and Manage Disruption...

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S P R I N G 2 0 1 6Joshua S. GansKeep Calm andManageDisruptionJust whisper the word “disruption” if you want to scarethe life out of many business leaders. But contrary to someclaims, disruption can be averted, and many businesses findways of managing through it.Vol. 57, No. 3Reprint #57305
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Keep Calm and Manage DisruptionIF YOU WANTto capture the attention of a busi-ness leader, say the word “disruption.” At least, that was the reaction of Andy Grove, then the CEO of Intel Corp., when he first heard the disruption theory espoused by Harvard Business School professor Clayton M. Christensen.1Christensen argued that even when a company does everything right — for example, focuses on its customers — it remains vulnerable to competition from unexpected sources. Christensen had seen a pattern of market leaders being upended by entrants in the hard disk drive and steel industries, among others. Grove called Christensen’s message “scary,”2and indeed, over the past 20 years, Christensen’s observations have led to widespread fear and paranoia. In the minds of many executives, disruption is just around the corner, and the fear is palpable. Seeing that fear has led some researchers3to ques-tion whether such emotion is justified. Using the examples of disruption that Christensen cited or an-ticipated, academics such as historian Jill Lepore, writing in The New Yorker, and Andrew A. King and Baljir Baatartogtokh, writing in MIT Sloan Manage-ment Review, have attempted to test the facts against the theory by looking at questions such as whether the claimed disruptions actually ended up causing businesses in their path to fail.4Although both analy-ses were more nuanced than determining that simple THE LEADING QUESTIONHow can companies avoid potential disruption?FINDINGSAttack by investing in the new disruptive technology.Cooperate with or acquire the market entrant.Having critical assets that entrants lack may buy you time.S T R AT E G YJust whisper the word “disruption” if you want to scare the life out of many business leaders. But contrary to some claims, disruption can be averted, and many businesses find ways of managing through it. BY JOSHUA S. GANSSPRING 2016 MIT SLOAN MANAGEMENT REVIEW83One strategy for dealing with a potentially disruptive competitor is to acquire it. For example, Facebook Inc. bought the photo-sharing social network Instagram, whose cofounders are shown here.PLEASE NOTE THAT GRAY AREAS REFLECT ARTWORK THAT HAS BEEN INTENTIONALLY REMOVED. THE SUBSTANTIVE CONTENT OF THE ARTICLE APPEARS AS ORIGINALLY PUBLISHED.
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84 MIT SLOAN MANAGEMENT REVIEWSPRING 2016SLOANREVIEW.MIT.EDUS T R AT E G Yrelationship, the researchers found that the claimed link between a disruptive innovation and signifi-cant trouble for established companies often did not hold up. This led them to conclude that the theory did not have a solid basis and that managers could place less weight on such concerns.
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  • Hard disk drive, MIT Sloan School of Management, Massachusetts Institute of Technology, MIT Sloan Management Review, Clayton M. Christensen.1 Christensen

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