Revisiting the Theory of Disruptive Innovation with Karen Dillon

Written By Bill Johnston

Reconsidering “Disruption”

Today the term "disruption" is commonly used in business to signal a wide range of disparate concepts - from new business initiatives to an individual or team pursuing seemingly innovative strategies. The concept of disruption comes from Clayton Christensen's theory of disruptive innovation, which he explored in his first book, "The Innovators Dilemma" in 1997.  

On this episode of the Cohere podcast my guest is Karen Dillon, former editor of Harvard Business Review and frequent collaborator with Clayton Christensen. In addition to numerous projects and articles, she coauthored three books with Clayton Christensen, including the New York Times best-seller "How Will You Measure Your Life?" All three books extended the theory of disruptive innovation and explore various contexts in which the theory can be a useful lens for solving problems.

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In our conversation, Karen shares her experiences editing both Inc. and Harvard Business Review, how she met and began collaborating with Clayton Christensen, her feelings about Christensen’s passing in January of this year, and how she continues to carry their work forward today.

Karen on how she met Clayton Christensen

”I knew Clay's name and reputation. Even when I was at Harvard business review, I hadn't worked with him. I just knew who he was this giant of thinking, one of the most influential thought leaders in the world. I was the editor of Harvard business review in the spring of 2010, I was casting around for an extra article to fill a double issue. It occurred to me then the spring of 2010, that the class that was about to graduate from Harvard business school. As soon as they got into business school, weeks into being a business school when the recession, hit things, fell off a cliff. So they spent their two years in business school hermetically sealed from the consequences of the recession or at least outside of it. And I was wondering in those two years, had they recalibrated their definition of success in any way had that caused them to think differently about what they wanted to do or how they would succeed in their life. As I started talking to students, they told me that Clayton Christianson had been asked to and given a talk to the graduating class at their, at the classes request and that they had found it extraordinarily moving. So I called Clay's office and asked if I could come by with a little digital recorder and we could figure out how to recreate whatever that talk was. He said, yes. In hindsight, I know it was crazy because he was the busiest man in the world and he found time for me right away. I went over there and sat down with my little digital recorder. It was the beginning of what was just a wonderful kind of meeting of the minds and collaboration. We worked together on that article, which became the Harvard business Review Article “How Will You Measure Your Life?” and that led to us just choosing to work together for the next decade. We worked on three books together, after that article and it was just a blast being part of his universe for that time.”

Karen on the Theory of Disruptive Innovation

”The word disruption has become, it's come to symbolize by, ambitious people, any ambitious upstart, Anyone that wants to challenge the status quo, I want to disrupt what exists and it's cool. It's a verb, disruptive and aggressive, momentum kind of way. But that is not what the theory of disruptive innovation is.

The theory of disruptive innovation, which Clay continually refined over decades. It was not a one and done. It was something he kept thinking about and working on and making sure he understood it and refined, but it predicts a very specific thing. It predicts what an incumbent, the established successful company will do in the face of competition from an upstart. So what do we know will happen when an existing, successful company starts to see a little tiny, ambitious, but low end, low quality product or service, trying to eat into its territory a little bit. What that theory predicts is that incumbent company, the existing company. almost always flee to the upper right of the craft, meaning they will try to make sure they hold onto their profitable customers. They in fact increase their profitability. They don't want to lose their profit margin. So they will chase. Continue chasing profitability at the expense of recognizing that they are at risk of not only losing some of their own customers, but they're missing an entire market of possible customers who could not afford or have access to whatever that higher end product or services.”

Karen on the Organizations That Are Best Positioned to Disrupt Themselves

“One of the key principles of disruption is to really look at the long horizon to be willing, to invest for the longterm and to be willing to disrupt things that aren't working and / or that may have finite shelf life.

I think entertainment (as a sector), we are going to see disrupting itself in some way. We see it with Netflix and streaming into our own lives. But I think somehow those are going to have to blossom into other, more full experiences for people, since it is clearly going to be a long time until we are going to be able to get back together. Things we are struggling with now - those are all industries that have the possibility for disruption and in struggle is where you see an opportunity to innovate.”

Karen on Disruptive Innovation Theory as a Means of Navigating the COVID-19 Disruption

”It does feel like a very bleak time and in certainly our lifetimes and a lot of history, but there were two things I'll point out for context:

One is, humanity has been through this and worse, over centuries. we know that some of today's most successful affluent prosperous societies were in terrible shape 150 years ago. Perhaps even most notably America. We had immense poverty and young children working in factories and terrible health issues. We forget, but America's come an incredibly long way from a very dark time. We had the civil war. We literally turned against each other and fought a civil war not that long ago in the course of human history.

The second thing I would say is that some of the most important companies and innovations have come from some of those darkest times. It's (the opportunity is) in seeing the world’s struggles as an opportunity to make it better or create something that will help people. So in struggle, you can see opportunity and we are surrounded by struggle and we are surrounded by all those powerful emotions that come with fear and, all of us needing to feel safe and connected and being afraid of what the future holds and, being uncertain. All of those things I would think would start to be come little breadcrumbs and clues for people who are just true innovators. To think about solving those struggles for people, because if you have a struggle in your life, it's probably likely that other people do as well. If you can find a way to solve that, struggle for them, make it easier for them create a product or service that solves that, I think you're at the beginning of something very powerful. Some of the world's greatest companies started in terrible conditions. Toyota was started in a bombed out a factory building after world war II where the roof was.decrepit and they had puddles on the factory floor.”

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Bill Johnston https://www.structure3c.com
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