The innovators dilemma new technologies cause established firm to fail

Today we want to talk about the innovators dilemma, as we all know new disruptive innovations happen time from time. It is always the new technologies that are invented to address existing problems that once success, will kill off great enterprise at that time, since what they represented as the business model and product of that time, starting to fall, and better addressed by the new innovation product, that happens all the time.

Peter Senge once in his learning organization book wrote about a classic example, a fog in the boiling water. Due to keeping adapting to the changing temperature, it will adapt until it can not take off and get boiled to death. It is not like most people instinct to think off will jump away, that happens only if you put it into extreme condition, but if you boil the water slowly it gives you the different result.

World is keep changing day after day, new invention and innovation do not overnight to change the future and cause the big corporation and established firm to fall immediately, it will slowly notice for the market shift and the new company gain momentum then mass critical, then replaced and extinct the existing one with product that do not meet the market needed anymore.

Most people will focus on buyer and market change, this is why the existing seller fails. But since it happens slowly, and the existing seller being the market leader possesses all the resources they have, why do they not mobilize resources to prevent that disaster from happening in the first place? The management is the root caused, they are get used to in the success position too long, they perceive themselves being the god in the business they are in, and they know everything, and as being the market leader, they do not play new game like those new entry player, they play the old games how the won in the past. This mentality and overall culture that influence the entire enterprise be the root cause for falling become possible. When the player is not more brother for innovation and tries to maximize their profit and recycle as many old designs and products, raise their product as high as they can charge, that brings in the need for the market who look for the change. New entrance players seize the opportunity to provide alternative offering and it is eventually undertaken by the market. This sound is very familiar for almost all the cases that happen in this way. We have once upon a time mighty Kodak, Nokia and a range of camera and watch manufacturers from what history teaches us the lesson for.

Despite the great existing firm getting all the resources, but they also got one barrier that will kill them off, they collectively believe they are the god, the market leader in the particular market, and they thought they will be forever be right all the time to produce what the market wants. They start to forget how the company was successful in the very beginning, listen to what the market wants and produce what the market is willing to pay them for.

In the business world, nothing is forever, the market keeps changing, that is why from the top to bottom, everyone needs to have the attitude to serve the customer who buys their product. If you are starting to make your own assumption about what the market wants and needs, instead of listening to the market what they really need, you are starting to create an opportunity for the new entry player to fill that opportunity by offering a new product based on the new technologies.

E-SPIN Group in the business of enterprise ICT solutions supply, consulting, project management, training and maintenance for multinational corporation and government agencies across the region E-SPIN did business since 2005. Feel free to contact E-SPIN for your project requirements and inquiry.