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Dr. Y. Bala Murali Krishna

Ever since the evolution of human civilisations, relentless efforts have been made to find something new to improve the quality of life. From churning heat on the dry husk to finding flint stones to produce fire, to cooking flesh in the primitive days; from burning fossil fuels and kerosene to the use of LPG and electric devices such as microwave ovens for cooking.

From the ordinary electric bulb to the energy-efficient CFLs (compact fluorescent lamps); from going to libraries to acquire knowledge to surfing the internet while sitting at home.

This spirit of invention continues unabated forever but with a difference. While some inventions were sustainable for long, there were others which were found to be 'disruptive'- in that the new technology almost decimates the older ones.

Take for example how the primitive version of mechanical calculators and watches were replaced by the digital versions flaunting many interesting features. Or, the mechanical Abacus, the voluminous electro-mechanical computers of the first generation with vacuum tubes replaced with micro-computers, laptops and Tablet PCs with higher processing speeds and attractive features.

The once-famous data storage devices such as the 3-1/2 inch floppy drives are a history. They have now been replaced with the USB Flash drives with higher capacity followed by compact portable 1TB/2TB external hard disk drives and cloud computing techniques to facilitate personal computing.

 What is a disruptive innovation?

The idea of 'disruptive' innovation was first advanced by Harvard Business School Professor Clayton Christensen in his popular book The Innovator’s Dilemma in 1997.

The first characteristic of a disruptive innovation is that it initially provides inferior performance (as measured by the prevailing industry metrics) to existing products available. As a result, it is usually not of much interest to existing users or customers.

The second characteristic is that it is adopted by a market, which is currently under-served or not served at all. In other words, it serves a market segment that did not exist before.

In his earlier work, Christensen often emphasised a third characteristic: a disruptive innovation has a steep improvement trajectory so that at a later stage, it can meet the needs of the initial market as well. But, it appears that this criterion is not stressed so much now.

Since disruptive innovations are usually not of interest to a company’s existing customers, market leaders are rarely the source of disruptive innovations.

Examples: Disruptive innovations can be found across industries and in the social sector. Here are some examples pulled together from Christensen’s work and elsewhere:

The personal computer: When first introduced, the PC did not provide the computational power or speed of existing mainframe or minicomputers. The PC created completely new segments of computer users such as home users, small office home office (SOHO) users, and students. Later, the Wintel PC configuration became so powerful that it displaced workstations from the market.

Low-cost airlines: When they started, low-cost airlines like Southwest did not provide many of the features that business customers expected like fixed seating, first class, and meals on-board or interline connections to other flights. Southwest, in particular, created a new market of short-haul air travellers by offering a service that competed with travelling by road.

Table-top copiers: First introduced by Japanese companies Ricoh and Canon, table-top photocopiers were much slower and offered less flexibility than the large copiers being sold by Xerox. But, these sleek copiers met the limited needs of individual managers or departments in corporations to get a few quick copies made to meet immediate needs.

How is Disruptive Innovation different from Radical Innovation?

The classification of an innovation as disruptive (as contrasted to 'sustaining') is based on performance and market-related parameters. Radical innovation is instead compared to incremental innovation and based on the magnitude of improvement in performance and a change in technology.

Radical innovation almost always seems to mean an order of magnitude improvement in performance or a significant shift from existing performance or solving a complex problem that existing products don’t solve. This means more sophisticated technology, based on pushing the boundaries of knowledge.

The first biopharmaceutical drugs were radical innovations because they used a completely different technology (biological methods of production rather than chemical synthesis) and addressed medical problems that could not be solved satisfactorily by existing drugs. New cancer therapies like the gamma knife are again radical innovations because they allow targeted radiotherapy, minimising radiation damage to healthy cells.

Disruptive innovations don’t need to be based on radical technological innovations of this nature. Microfinance, for example, did not involve radically new technology.

When did the term originate?

Harvard professor Clayton M. Christensen coined the term ‘disruptive innovation’ in his book, The Innovator’s Dilemma-When New Technologies Cause Great Firms to Fail, published in 1997.

 Why are disruptive innovations important?

Disruptive innovations, or for that matter, all types of innovations are important in that the customer could plan his budget in accordance with his requirement of the future in his business and applications.

 Where can one find examples of this mega trend today?

The mega trend is noticeable in the computer hardware and software sectors and electronics. The best example is the ICT sector in the media communications and the mobile communication sector, which have been witnessing revolutionary developments year after year world over.

Gone are the days of walkie-talkies and wireless Pagers (Beepers) for communicating short text message in 1960’s. They have now been replaced since 1990’s by innumerable versions of the wireless mobile phones including the 2G (only text, audio, video and photo communication) and 3G (with MMS, Voice and many other features) technologies even as some companies are preparing for offering the 4G technologies in the near future.

Who will benefit the most?

The manufacturing industry with the expertise to woo rapidly changing and emerging technologies could benefit the most as they could survive the competition. This in turn benefits the consumers as products with new technologies emerge, besides the business community, small and big, in the long run.

The live example is of the personal computer. Initially, a low configuration desktop computer with an inkjet printer would cost around Rs. 75,000 per unit in the year 2000. As more companies entered the manufacturing sector and the government offered duty concessions and lesser taxes to the consumer, the costs came down drastically.

How is this information relevant to me?

The news about the technologies- disruptive/radical/sustainable- are relevant to all communities as they could buy the devices with latest technologies depending on their requirement. The consumers have to keep a track of the emerging technologies by constantly getting the updates on emerging trends so that they could make relevant changes in the respective organisations as the media organisations do.

All these mega trends force us to monitor constantly the emerging technologies, disruptive or otherwise, and the benefits they accrue so that we woo them according to our needs.

 

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