Christensen's Innovator's Solution – 50 Book Challenge

I committed to the 50 book challenge last month. I'm moving along with the reading, now I'm trying to get current with writing about it. Here's the first write up. I'm not quite sure how I'm going to organize this, beyond the posts themselves. We'll see what develops.


The Innovator's Solution: Creating and Sustaining Successful Growth
Christensen, Clayton M.

Christensen's The Innovator's Dilemma was easily one of the best business books I've read in the past 10 years. The Innovator's Solution is in the same category. I suspect we'll look back in a few years and place this work in the same seminal category that Michael Porter's books on competitive strategy acquired in the 80s.

Christensen's work sytematically addresses the problems I wrestled with in working with Porter's conception of strategy. Porter's work is rooted in classical industrial economic analysis, which by and large focuses on questions of equilibrium. I could never see how to connect that work to the dynamic, technology driven environments I worked in. Christensen addresses that in very powerful ways.

One of the aphorisms I took to heart from The Innovator's Dilemma was “markets that don't exist can't be analyzed.” In this book, Christensen begins to lay out how you can take the notions of disruptive innovation and use them to design a reasonable course of action in the absence of the kind of analytical data strategy consultants desire.

He returns to his original distinction between sustaining and disruptive innovation. As he takes pains to repeat, these are not synonyms for “incremental” and “breakthrough.” Christensen is interested in the market impacts of an innovation, not in its technological pedigree. Regardless of its technological difficulty, an innovation is sustaining if it is designed against the performance criteria of existing customers and markets; particularly the criteria of the most advanced and demanding customers.

Disruptive innovations attack either the lower ends of existing markets where there are customers willing to settle for less performance at less cost, or new markets where a new packaging and design of available technologies creates an alternative to non-consumption. The example I found easiest to understand here was Sony's invention of the portable transistor radio. Compared to vacuum tube radios the first transistor radios were crappy, but good enough for teenagers and others on the go whose alternative was no music at all.

A well concieved disruptive innovation attacks a market that existing competitors would happily abandon (customers who complain that your products are too complex and expensive for their basic needs) or do not see. This keeps you off the radar while you build a market and improve the performance of your product.

Christensen's approach also suggests some counterintuitive approaches to launching innovations intended to be disruptive. In particular, he argues convincingly against trying to get big fast in favor of seeking profitability early on. I need to think some more about that and see how you might account for something like Amazon in his framework. Which would start with deciding whether you would consider Amazon to be a sustaining or a disruptive innovation. I think I could argue either side. Regardless, I suspect that this is a book that like Porters', I will read several more times before I figure it all out.