One of the great irony of successful companies is how easily they can fail. New companies are founded to take advantage of some new technology. They become highly successful and but when the technology shifts, something new comes along, they are unable to adapt and fail. This is the innovator’s dilemma. Then there are companies that manage to survive. For example, Kodak survived two platform shift, only til fail the third. IBM has survived over 100 years. What do successful companies do differently?

1. Lecture L09
THE INNOVATOR’S DILEMMA

2. NMENT
NG ASSIG
READI
Economist article: The last Kodak moment?
!
Kodak is at death’s door; Fujifilm, its old rival, is thriving. Why?

3. Founded in 1880
Noted for their
pioneering technology
“You press the button,
we do the rest”
By 1975 they had 90%
of firm and 85% of
camera sales in US

6. Technology is
one of the
major factors
in change

7. The Innovators Dilemma
Firms that
s u c c e e d in one generation of innovation
almost inevitable become hamstrung by their
own success and thus doomed to
l o s e o u t in the next wave of innovation
Source:
(Christensen,
2000)

8. Surviving Technological Change
What is it that kills successful
companies?

9. Understanding the Job
Clayton Christensen
professor at Harvard Business School

10. Reason for Failure?
If you become wildly successful
because you do everything right,
you're doomed

11. Traditional Concept of
Good Management
Focus on your best customers
Focus on your highest margin products
Source:
Yang,
Harvard

12. The RPV Theory
Resources, Processes and Values Theory
R e s o u r c e s (what a firm has),
p r o c e s s e s (how a firm does it´s work), and
v a l u e s (what a firm wants to do)
collectively defines an organisation’s strengths
as well as weaknesses and blind spots
Source:
(Christensen,
2000)

13. WHEN
P L AT F O R M
S H I F T HAPPEN,
COMPANIES FIND
IT HARD TO MOVE
TO NEW
GENERATION OF
TECHNOLOGY

14. Only ONE established firm
managed the transition from one
generation to the next
Image
Source
Page:
http://www.teach-­‐ict.com/wp/archives/264

15. Why did they fail?

16. They listened to their
customers

17. Case Study
Betware transformed
from custom software
development to
product development
– from technology to
service

18. If I’d asked my
customers what
they wanted,
they’d have said a
faster horse
- Henry Ford

19. We tend to view technology
based on
past usages
but not the future potential

20. The hardest things when you are trying to affect change
!
Steve Jobs Insult Response, WWDC 1997

21. Traditional Concept of
Good Management
Leads successful companies to ignore
disruptive innovations with deadly
consequences
Source:
Yang,
Harvard

22. The Innovation Trap
“We listen to our best customers”

23. The Innovation Trap
“Our customer is asking for the
new product, but we don’t have it
and its to late the enter the market”

24. The Innovation Trap
“Our customer are starting to ask
for our new product.”

25. It is very difficult for incumbent
companies to disrupt themselves,
so usually others will do it

26. Markets that do not
exist cannot be
analysed
!
- Clayton Christensen