Dealing with Discontinuity: How to sharpen up your innovation act

Abstract

Every now and then a disruptive event happens, such as the invention of the internet, that changes markets, industries, even societies. Successful well-managed companies thrive in mature markets by focusing on doing what they do, just a little bit better. Consequently, when a disruptive event, such as new technology or a regulatory change comes along, the successful company is often blindsided. It is just not very good at the ‘doing it different’ type of innovation. The very attributes that make it successful in stable conditions hinder its ability to detect or exploit the change. The consequences of failing to take advantage of such disruptive change are all too frequently severe. Companies lose out to new entrants. Eastman Kodak, for example, struggled to cope with a shift to digital photography. Xerox failed to capitalise on digital photocopying. Many companies missed out on the internet. Our research suggests that companies should adopt parallel routines for managing innovation related to discontinuous events, alongside their routines for managing innovation in stable conditions.