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  • How does a small, young company beat an industry giant

  • on its own turf?

  • Through what Harvard Business School professor Clayton

  • Christensen calls disruptive innovation.

  • It works like this.

  • Big players focus on sustaining innovation, upgrading

  • existing products and services to attract

  • higher-paying customers.

  • But soon they start to ignore all the regular customers who

  • just want simple, low-cost alternatives.

  • That's where the entrepreneurial company jumps in

  • with that basic offering.

  • The big guys stay focused on more profitable customers

  • and begin to overserve, adding bells and whistles no one

  • wants to pay for.

  • Meanwhile, the disruptor improves its product

  • to appeal to more people.

  • By the time the incumbent notices,

  • the disruptor has already started

  • to take over the market.

  • The classic example is the steel mini mills

  • which first produced low-quality rebar, then moved

  • to sheet steel, stealing business

  • from the large mills that had been dominant.

  • More recent disruptors include makers like Toyota and Hyundai,

  • which launched with economy models then added

  • luxury features and brands.

  • The only way for industry giants to fight back

  • is by launching their own disruptive innovations.

  • To succeed, they must treat the project

  • as a separate unit with a different business

  • model and growth expectations; ask

  • what job do customers need to get done;

  • segment customers by job, not by product, market size,

  • or demographics; and develop basic, low-cost ways

  • to get the job done.

  • That's how Procter Gamble came up

  • with Crest White Strips, a cheap, do-it-yourself

  • alternative to an expensive dental service.

  • Disruptive innovation creates new markets

  • and reshapes existing ones.

  • To achieve growth in a fast-changing world,

  • you want to be a disruptor.

  • Don't be disruptive.

How does a small, young company beat an industry giant

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B1 US disruptive innovation steel existing job growth

The Explainer: How to Be a Disruptor

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    jbsatvtac1 posted on 2019/08/16
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