Disruptive Innovation is feared by The New York Times since 1995!
Theory of Disruptive Innovation:
Disruptive innovation was presented by Harvard University professor Clayton Christensen, also known as the 'Einstein of Business Administration', in 1995 through HBR.
It can also be seen as a relatively old management theory that has been published for more than 20 years.
However, with the advancement of technology, the pace of change in society is accelerating...
Disruptive innovation theory is also a very infinity theory that gets more and more talked about over time.
In particular, the term 'innovative destruction', a subtle combination of 'creative destruction' proposed by the economist Joseph Schumpeter and 'disruptive innovation' of Clayton Christensen, was also talked about among people. ^^;
The expression 'disruptive innovation' has become quite popular among people, but unfortunately, the details of Clayton's theory of disruptive innovation are not well known.
Paradoxically, the term 'disruptive innovation' was used as a buzzword even at a point completely unrelated to Professor Clayton Christensen's theory.
Professor Clayton Christensen's article on 'What is Disruptive Innovation':
Professor Clayton Christensen updated his theory by publishing an article titled 'What is Disruptive Innovation' in 2015.
In this article, Professor Christensen says:
“It has already been proven that Disruptive Innovation Theory is a powerful methodology to study innovation-led growth”
"Many startup leaders are praising this theory and taking it as a guide."
“Unfortunately, however, the theory of disruptive innovation runs the risk of becoming a victim of its own success.”
"Despite the widespread dissemination of the theory, misunderstandings about key concepts have spread, and "basic principles have often been misapplied."
"Moreover, the theory has been continuously improved and supplemented over the past 20 years."
"These were overshadowed by the popularity of the original theory, and even the flaws that had already been corrected were criticized."
“There are more things to worry about.”
"From our experience"
"Too many people talking about 'disruption' who haven't read any books or articles on this theory."
"In order to defend what such people want to do in the name of innovation"
"I use this term sloppy"
"Many researchers, writers, and consultants use 'disruptive innovation' to describe 'everything' situations in which industries are reshaped and previously successful companies collapse."
“But this is an overuse of a term that is too broad.”
(Professor Clayton Christensen)
In the meantime, Professor Clayton Christensen said that 'Uber', which was often mentioned as the protagonist of disruptive innovation in the market at the time...
He asserted that it did not conform to the 'disruptive innovation theory'.
The three main types of innovations, 'Disruptive innovation:
From Clayton Christensen's point of view, there are three main types of innovation in the world.
The first is 'sustainable innovation'. It refers to a method of improving the quality little by little while maintaining the current structure, product, or service well.
second is
This is 'efficient innovation'. It refers to innovation that increases efficiency by reducing production and labor costs.
And the third is
It's called 'disruptive innovation'. This refers to innovation that occurs as new players disrupt existing markets.
Elements of disruptive innovation[/caption]If we define disruptive innovation based on meaning like this...
It seems like every new attempt to replace a player in an existing market could be called a disruptive innovation.
However, Clayton Christensen's point here is a little more profound. This is because Professor Christensen focused more on the 'process' of the disruptive innovation rather than the 'result' of the disruptive innovation.
'Process' of Disruptive innovation:
To put it bluntly, Professor Christensen and his team analyzed and studied how disruptive innovation is created, not just a result.
As a result, the team believes that disruptive innovation
Discover the fact that 'it only happens through two pathways'.
The first path is 'a leap from the low-cost market'. According to Christensen, mainstream players in established markets maintain service or product quality based on their most profitable customers.
Maybe it's just too obvious. However, it is unnecessary
'Overshoot' occurs.
* Overshoot: Providing customers with services that exceed their needs.
By the way!
In this situation, what if a product or service that meets the minimum requirements that a product or service must have appears on the market at a low price?
Business to business[/caption]People who wanted to try the service or product but were worried about the price, or those who want to use only the core functions at a low price will use it. That's how a niche market is created.
However, the quality of products and services of the early companies in this period is so poor that it cannot be compared with the quality of products of the existing hegemons, so no matter how many people they gather, existing players do not pay much attention to it, and the quality of the products is poor. The customer base is not moving.
That...that...but.
'low end footholds' and 'new-market footholds':
What if this low-cost new player steadily develops the service or, due to new technological momentum, the moment comes when the service quality of the existing players is not significantly different?
When that happens, in an instant, the low-cost player completely disrupts the incumbent's business and completely replaces the market.
If the quality is similar, it would be natural to use a low-cost or free service.
That's how disruptive or disruptive innovation happens. This is the first path Clayton Christensen argues for disruptive innovation to take place.
He called these 'low end footholds'.
The second route is for new players to start a business in a completely different market from existing players. (new-market footholds)
For example... In the past, the market has been centered on B2B... It refers to a case in which a new player starts a business as a B2C service and then penetrates into the B2B market and destroys the existing market.
And Professor Christensen asserts that disruptive innovation only occurs through these two pathways, so no matter how much you change the world, if you didn't follow these two pathways... that's not disruptive innovation.
Of course, since this is a fact that was discovered after a long study, the criteria may be strict from the point of view of the researcher. However, because it is too strict
Disruptive innovation, a problem of 'composition and path':
You might even think it's silly. However, there is something else we should pay attention to in Christensen's theory of disruptive innovation other than this vulgarity.
That is, when a disruptive innovation proceeds in the market... Even if an existing operator shows outstanding lasting innovation, 'that doesn't mean much'.
In other words, no matter how good a manager or team is, if a disruptive innovator emerges in the market, it can collapse in an instant.
I think this is the most attractive point of the disruptive innovation theory.
Explain that when disruptive innovation occurs, existing players are bound to fail even if they do their best to sustainably innovate.
In other words, disruptive innovation is not a problem of individual operators, but a problem of composition and path.
And this theory presents hope to new players such as startups dreaming of disruptive innovation, and fear to established market players.
At this point, we need to revisit the New York Times Innovation Report.
Then, why does the innovation report introduce the theory of disruptive innovation at the beginning of the article?
Did you lay it out and explain it?
At the time, the NYT had the best journalism in the world, but low-quality free services such as BuzzFeed appeared on the market.
And they used the new technological paradigm of social media to wield a level of influence comparable to that of the New York Times, both with low-quality content and with digital pickpocketing content.
The New York Times innovation report:
How would the NYT reporters at the time, seeing this happen, feel when they looked back at this theory of disruptive innovation?
It's premature, but I think it must have been very scary.
Because even great journalism can be meaningless when disruptive innovation takes place.
[caption id="attachment_5013" align="alignleft" width="300"]
New York Times innovation report[/caption]So, as I re-read the Innovation Report, I realized that the real reason the New York Times wrote the Innovation Report was to inform the insiders that disruptive innovation was taking place in the marketplace.
Also, I thought that there was one word hidden in the title of 'innovation report'.
yes, you guessed it
Disruptive innovation report,
That's the disruptive innovation report. There's one thing I'm curious about. So, how should incumbent players react when disruptive innovation occurs?
Do we really have to be helpless?
Of course not! Professor Clayton Christensen suggested two major countermeasures.
Two major countermeasures, when 'disruptive innovation' occurs:
The first is to create separate, small, specialized organizations to which disruptive innovation responds and enable them to respond to market changes.
Because no matter what change you try to pursue within the existing system, it eventually converges to lasting innovation... Professor Christensen argues that it is much better to create a small, separate organization to respond.
The second solution is to 'make the relationship with existing mainstream customers stronger'.
Even if there is a disruptive innovation in the market, unless the mainstream customers, who are the core, do not pass...
[caption id="attachment_5014" align="aligncenter" width="300"]
proposed countermeasures for disruptive innovation[/caption]
The collapse can be prevented because the market leadership is not taken away.
Of course, it is necessary to separately consider whether these two methodologies suggested by Christensen are really valid. There are clearly objections to this.
[caption id="attachment_5129" align="alignleft" width="300"]
Disruptive innovation concept illustration. Idea of new technology and creativity.[/caption]However, what we need to pay more attention to here is that, surprisingly, these two solutions are listed in the New York Times Innovation Report.
The innovation measures contained in the NYT Innovation Report are divided into three categories: the establishment of a separate strategic team, a business centered on paid subscribers, and improvement of the organizational culture centered on digital.
Except for the improvement of the organizational culture, everything else is almost in line with the solution proposed by Professor Christensen.
And this part can be seen as a 'defense measure' that can be taken not only by the New York Times but also by incumbents who need to prevent the collapse of the market.
'Defensive measure' in New York Times innovation report:
Perhaps in the context of disruptive innovation, incumbents are not pursuing sustainable innovation that clumsily imitates other companies, but rather a dedicated organization that can identify who their core customers are and what they need to do to protect them, and then execute them the fastest. Maybe I need to make a ?
No, maybe the appearance of the NYT, which is defending its position after defending against attacks such as BuzzFeed, is not showing us that not being innovated can also be the best innovation?
As if attack is the best defense...
Couldn't the best defense also be an offense?
“In the meantime, the New York Times has walked the path of change whenever the needs of its readers change.”
"Senior generations are placing new sections and color photos in newspapers, such as weekend magazines, book reviews, reader letters, and daily specials."
New York times report on disruptive innovation[/caption]"I made a new attempt, and I survived"
"We inherit this spirit of innovation"
“The NYT article, the best in the world, is moving from the paper to the computer and now to the smartphone, reaching readers.”
“But the digital transformation is not over yet.”
"On the contrary, the way readers access and communicate news and information is changing faster."
“Now we have to keep pace with the pace of our readers.”
"No one can predict the future."
“The NYT now faces strong challenges in both the implementation of digital journalism and the management of the company.”
"If we don't get through these challenges,
The NYT will lose its status to its competitors."
“It means that companies that were strong in the past will follow the same path that collapsed because they failed to innovate.”
“And the NYT now faces a much more threatening and challenging task than its predecessors faced.”
“But the challenges of our predecessors and ours are essentially the same.”
“That is, more creatively and firmly upholding the value of journalism that the New York Times has been adhering to.”
“To do that, we have to act faster than we are now.”
- New York Times 2020 report
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