We all have heard a lot about the term disruptive technology in recent years. In this article we discuss about What actually disruptive technology mean and how it has impacted our lives over the years? But before discussing about disruptive technology, let us try to understand about disruptive innovation.
The theory of disruptive innovation is developed by Clayton M. Christensen in the year 1995. In his article Disruptive Technologies: Catching the Wave, which he co-write with Joseph Bower. In the book, he discussed how the companies which are in top now could be out of the market, if they did not pay attention to disruptive innovation.
Disruptive innovation in simple terms can be defined as the product that historically was scarce and expensive but now it is affordable and widely available.
In the word of Professor Clayton M. Christensen, Disruptive innovation is not a breakthrough innovation that makes good product a lot better.
It has a very specific definition and that is it transforms a product that historically was so expensive and complicated that only few people with lot of money and lot of skill had access to, a disruptive innovation makes so much more affordable and accessible that a much larger population have access to it.
Examples of Disruptive Innovation
At the beginning the manifestation of digital technology was a mainframe computer cost several million dollars to buy and it took years to trained to operate these things. So that meant the largest corporation and largest universities can have one, so we had to take problem at the center where the expert solved it for us.
But then there is sequence of innovation from mainframe to mini to desktop to laptop that is democratized technology to the point that everybody has access to it around the world. So, the new generation of computers are the examples of disruptive innovation.
2. LCD TV versus Cathod Ray Tube (CRT) TV
CRT TV was expensive when it came to existence. Only few people who had a lot of money could afford it. It was a ground breaking technology which allowed you to watch movies and videos at your home but it wasn’t a disruptive innovation.
When there was sequence of innovation from CRT to LCD to LED, those LCD and LED were affordable to large number of people. So, LCD are the examples of disruptive innovation.
3. Cell Phones Versus Smartphones
In the 90s Cell phones company were the market leader or pioneer in the communication field. The customer base was small but the profit margin was good.
But the innovation of cell phones continued as they were immobile, expensive to better phones. Finally, mobile phones came into existence which are portable and affordable to larger customer base. So, Smartphones are the examples of disruptive innovation.
In simple terms Sustaining Innovation means to make the existing technology better for existing customer group. Disruptive innovation targets new customer group by making affordable product whereas sustaining innovation improves the existing product of the company and offer to same customer group in high profit margin.
The perfect example of Sustaining Innovation is iPhone. Every year new and improved iPhone is manufactured by the Apple company for their existing customer group.
The technology which disrupt the existing technology in the market and shakes up the industry or a ground-breaking product that creates a completely new industry is known as disruptive technology.
In other words, disruptive technology refers to any enhanced or completely new technology that replaces and disrupts an existing technology.
Disruption is the process whereby a small company with limited resources, such as a startup, successfully challenges a larger established business or invents entirely new markets.
We in our day to day life see various examples of disruptive technology. Disruptive technology has had a huge impact in the life of people nowadays. It dictates how people function nowadays.
Examples of Disruptive technologies
- Typewriter was replaced by personal computer. It is one of the examples of disruptive technology. Pioneer of the market at one time, typewriter did not realize the threat computer presented to its business and now it is out of the business.
- Email is another example of disruptive technology. It disrupted the postal service of communication from the market. Now almost all companies are dependent upon the email to communicate with each other.
- Social media is another example of disruptive technology. People used to make social networking with other people with communication components such as telephone, messages and email. In the present days it is disrupted by social media, now people make their social networking via social media. So social media is the present-day example of disruptive technology.
- Mobile and digital wallet has disrupted the traditional cash system. Now you can make your payments via mobile or digital wallet. Digital wallet has also created easy way for people to shop without worrying about cash. The disruption it has brought it in the market makes digital wallet one of the examples of disruptive technology.
- Cloud computing is another example of disruptive technology. Previously people used to store their data on computer, pen drive, laptop or phones and there was always a chance of loss of data if your device stop working. But with the arrival of cloud computing we can get the assurance of safety and availability of your data. Cloud computing disrupted traditional methods of storage, so it is one of the examples of disruptive technology.
Is Uber an example of disruptive innovation?
There is confusion among people whether or not Uber is a disruptive innovation. Clayton M. Christensen, Professor who developed the theory of disruptive innovation has given his view on the matter.
He used the example of uber to describe disruptive innovation. According to Clayton M. Christensen, Uber is an innovative company but it is not the example of disruptive innovation. Instead he says that uber is an example of sustaining innovation as it has improved the existing taxi industry and not disrupted taxi industry as a whole.
But many people argue that uber is a disruptive technology as it has disrupted taxi from the market. Has uber successfully disrupted taxis from the market? It is for you to decide, what do you think of Uber?
Is Netflix a disruptive technology?
Another popular question in the mind of people is whether or not Netflix is a disruptive technology company. Well the answer is yes.
Netflix is a disruptive technology company because it disrupted the DVD by mail service from the market. DVD was popular source of movie viewing in the past days but now it is nowhere to be found.