Exam 6: Disruptive Technologies: Understanding the Giant Killers and Considerations for Avoiding Extinction

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Those running big firms fail to see disruptive innovations as a threat not because they are dumb, but in many ways because they do what executives at large, shareholder-dependent firms should do-they listen to their customers and focus on the bottom line. And because the majority of a firm's current customers don't want the initially poor-performing new technology. The most disruptive technologies also often have worse margins than the initially dominant incumbent offerings. Since these markets don't look attractive, big firms don't dedicate resources to developing the potentially technology or nurturing the needs of a new customer base. Your best engineers are likely going to be assigned to work on cash-cow offerings, not questionable new stuff. This results in a sort of blindness created by an otherwise rational focus on customer demands and financial performance.