THE TURMOIL OF BUSINESS COMPETITION has often been likened to a stormy sea. “Gales of creative destruction,” economist Joseph Schumpeter wrote, periodically sweep through industries, sinking weak and outdated companies. In the mid-1990s, the winds of change appeared especially powerful, threatening even some of the strongest businesses. Enter Clayton M. Christensen, a professor at Harvard Business School who is now considered one of the world’s leading experts on innovation and growth. In his 1997 book, The Innovator’s Dilemma, Christensen provided an explanation for the failure of respected and well-managed companies. Good managers face a dilemma, he argued, because by doing the very things they need to do to succeed — listen to customers, invest in the business, and build distinctive capabilities — they run the risk of ignoring rivals with “disruptive” innovations.
Christensen’s theory of disruptive innovation has gripped the business consciousness like few other ideas. In a review of enduring business books, The Economist called the theory “one of the most influential modern business ideas.” Other commentators have noted that the theory is so widely accepted that its predictive power is rarely questioned. The theory’s influence has spread far beyond the business world. Christensen and his associates have proposed disruption as a framework for thinking about vexing social problems such as poverty, lack of access to health care, illiteracy, and unemployment. The theory, or variations thereof, has been used in so many settings that Christensen himself has expressed unease with some of the ways the theory is being applied. In an interview with the editor-in-chief of the Harvard Business Review, he said, “I never thought ... that the word disruption has so many connotations in the English language, that people would then flexibly take an idea, twist it, and use it to justify whatever they wanted to do in the first place.” So, what is the right way to use the theory of disruptive innovation? What are its core elements, and how predictive is it? We decided to examine these questions by taking a closer look at the theory.
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