What is the Difference Between… Sustaining Innovation and Disruptive Innovation.

26
What is the Difference Between… Sustaining Innovation and Disruptive Innovation

Transcript of What is the Difference Between… Sustaining Innovation and Disruptive Innovation.

Page 1: What is the Difference Between… Sustaining Innovation and Disruptive Innovation.

What is the Difference Between…

Sustaining Innovationand

Disruptive Innovation

Page 2: What is the Difference Between… Sustaining Innovation and Disruptive Innovation.

Sustaining Innovation

•“Doing it Better”•Way For Products to Change•Does Not Create New Growth

Page 3: What is the Difference Between… Sustaining Innovation and Disruptive Innovation.

Disruptive InnovationPS3 vs.

Wii•“Playing the Game

Differently”•Creates a New Market•Transforms or

Destroys Current Market

•Products Become▫Simpler▫More Affordable▫More Accessible▫Customizable

•Drives Growth

Page 4: What is the Difference Between… Sustaining Innovation and Disruptive Innovation.

Technology is Going to Advance and There is No Stopping it, Even if it Ruins an Industry…

Page 5: What is the Difference Between… Sustaining Innovation and Disruptive Innovation.

…The Good News is That it Often Creates a New Industry

Page 6: What is the Difference Between… Sustaining Innovation and Disruptive Innovation.

Companies Either Get on Board…

Page 7: What is the Difference Between… Sustaining Innovation and Disruptive Innovation.

…Or Get Left Behind

Page 8: What is the Difference Between… Sustaining Innovation and Disruptive Innovation.

The Technology Industry

Page 9: What is the Difference Between… Sustaining Innovation and Disruptive Innovation.

VOIP•35% of Businesses Use VoIP•Allows For One Phone Line•Avoids Long Distance Charges

Page 10: What is the Difference Between… Sustaining Innovation and Disruptive Innovation.

Communication

•Post Office to Today

•Communication Forms are Merging

•Mobile Computing Could Replace Desktops and Notebooks

Page 11: What is the Difference Between… Sustaining Innovation and Disruptive Innovation.

Music Industry’s Current State

•Lower Profit Margins•Whatever song you want, whenever you

want

Page 12: What is the Difference Between… Sustaining Innovation and Disruptive Innovation.

New Music Industry Business Models•Subscription Services

▫Pandora, Spotify, Grooveshark•Digital Download Services

▫Apple iTunes, Amazon MP3•Partnering With Tech Companies

▫EMI and Warner•Online Album Promotions

▫The Killers

Page 13: What is the Difference Between… Sustaining Innovation and Disruptive Innovation.

Ethical Questions•Difference Between Downloading Free

Music Versus Listening to Music for Free Over the Radio or Internet?

•Is Downloading Free Music Unethical?

Page 14: What is the Difference Between… Sustaining Innovation and Disruptive Innovation.

Name That Disruptive

Technology!

Page 15: What is the Difference Between… Sustaining Innovation and Disruptive Innovation.
Page 16: What is the Difference Between… Sustaining Innovation and Disruptive Innovation.

Disruptive Innovation•Helps Create New Markets•Disrupts an Existing Market and Value

Network▫Can Take a Few Years or Even Decades

•Displaces an Earlier Technology•Unpredictable•Designed for a Different Set of Consumers

in a New Market•Lowers Prices in Existing Market

Page 17: What is the Difference Between… Sustaining Innovation and Disruptive Innovation.

AKA Creative Destruction•Leads to Paradigm Shifts

▫A Change in the Basic Assumptions or System Conditions

▫Permanently Disrupting the Framework•The Idea of Punctuated Equilibrium With

the Emergence of New Eras

Page 18: What is the Difference Between… Sustaining Innovation and Disruptive Innovation.

Where There is Risk, There is Reward

Page 19: What is the Difference Between… Sustaining Innovation and Disruptive Innovation.

The S-Curve

Page 20: What is the Difference Between… Sustaining Innovation and Disruptive Innovation.

The Future of Hollywood•Digital Content

•Netflix and Hulu Plus are Looking at Original Content

•Consumers are Willing to Pay for Access to Content

•Ticket Sales have fallen 200 million since 2002

Page 21: What is the Difference Between… Sustaining Innovation and Disruptive Innovation.

Early Adoption Risks•Picking the Wrong Technology

▫HD-DVD vs. Blu-ray•Not Following Real Consumer Trends

▫GM’s Hummer•Further Technological Innovation

Page 22: What is the Difference Between… Sustaining Innovation and Disruptive Innovation.

Late AdoptersKodak Hasbro

Page 23: What is the Difference Between… Sustaining Innovation and Disruptive Innovation.

Major Success StoriesGoogle Apple

• Apps• beta releases• Adwords

• Reinvention• iPod• iPhone• iPad

Page 24: What is the Difference Between… Sustaining Innovation and Disruptive Innovation.

“You don’t know when the transition period will start. The

idea is to understand that it will…and become prepared for it.”

-Dr. Timothy BishopFuture Studies, University of Houston

Page 25: What is the Difference Between… Sustaining Innovation and Disruptive Innovation.

Sources• http://clients.ibisworld.com/industryus/M

ajorcompanies.aspx?indid=894• http://www.ksla.com/Global/story.asp?S=

12533107• http://nymag.com/nymetro/news/media/co

lumns/medialife/6099/• http://www.theregister.co.uk/2010/03/08/

npd_home_streaming/• http://

www.fool.com/investing/general/2012/06/18/streaming-music-will-make-your-ears-and-pockets-r.aspx

• http://www.hollywoodreporter.com/news/music-film-industries-average-lowest-167422?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+thr%2Fnews+%28The+Hollywood+Reporter+-+Top+Stories%29

• http://articles.businessinsider.com/2011-02-18/tech/30052663_1_riaa-music-industry-cd-era

Page 26: What is the Difference Between… Sustaining Innovation and Disruptive Innovation.

Sources cont.• http://www.zdnet.com/blog/storage/when-

will-the-ipad-replace-desktops/1631• http://voipstrategy.com/University/VoIP_B

enefits.aspx.html• http://voipstrategy.com/University/VoIP_B

enefits.aspx.html• http://www.lightreading.com/document.as

p?doc_id=190826• http://www.macworld.com/article/115781

7/tv_movie_future.html• http://www.washingtonpost.com/wp-dyn/c

ontent/article/2005/11/11/AR2005111101644_2.html

• http://myventurepad.com/jeffweinberger/91147/apple%E2%80%99s-plight-will-disruptive-innovation-make-it-winner

• http://www.the-numbers.com/market/