Disruptive Innovation Management

Adisruptive innovationis aninnovationthat helps create a newmarketandvalue network, and eventually goes on to disrupt an existing market and value network (over a few years or decades), displacing an earlier technology. The term is used in business and technology literature to describe innovations that improve a product or service in ways that the market does not expect, typically first by designing for a different set of consumers in the new market and later by lowering prices in the existing market.

In contrast todisruptiveinnovation, asustaining innovationdoes not create new markets or value networks but rather only evolves existing ones with bettervalue, allowing the firms within tocompeteagainst each other's sustaining improvements. Sustaining innovations may be either "discontinuous"[1](i.e. "transformational" or "revolutionary") or "continuous" (i.e. "evolutionary").

The term "disruptive technology" has been widely used as a synonym of "disruptive innovation", but the latter is now preferred, because market disruption has been found to be a function usually not of technology itself but rather of its changing application. Sustaining innovations are typically innovations intechnology, whereas disruptive innovations change entiremarkets. For example, the automobile was a revolutionary technological innovation, but it was not a disruptive innovation, because early automobiles were expensive luxury items that did not disrupt the market forhorse-drawn vehicles. The market for transportation essentially remained intact until the debut of the lower pricedFord Model Tin 1908.[2]Themass-producedautomobile was a disruptive innovation, because it changed the transportation market. The automobile, by itself, was not.idea glow