{"id":16734,"date":"2020-10-30T23:23:00","date_gmt":"2020-10-31T03:23:00","guid":{"rendered":"https:\/\/www.shortform.com\/blog\/?p=16734"},"modified":"2020-11-07T14:56:14","modified_gmt":"2020-11-07T18:56:14","slug":"industry-disruptors","status":"publish","type":"post","link":"https:\/\/www.shortform.com\/blog\/industry-disruptors\/","title":{"rendered":"Industry Disruptors: Excavator Case Study"},"content":{"rendered":"\n<p>What are some <a href=\"https:\/\/www.shortform.com\/blog\/market-disruptors-zero-to-one\/\">industry disruptors<\/a>? What forms do disruptive business models take?<\/p>\n\n\n\n<p>Industry disruptors are best understood in the context of case studies. The excavator industry offers examples of disruptive business models.<\/p>\n\n\n\n<p>Read on to understand disruptive business models and industry disruptors through the excavator industry.<\/p>\n\n\n\n<!--more-->\n\n\n\n<h2 class=\"wp-block-heading\">Excavator Industry Disruptors<\/h2>\n\n\n\n<p>In 1950, a dominant cable excavator manufacturer, Bucyrus Erie, saw hydraulic excavators\u2019 rise and bought a small hydraulic backhoe company. But <strong>instead of entering the emerging residential construction market, Bucyrus created a hydraulic-cable hybrid to market to its existing customers.&nbsp;<\/strong> Bucyrus was one of the excavator industry disruptors.<\/p>\n\n\n\n<p>The machine, called the Hydrohoe, used hydraulics to guide the shovel into and through the dirt, but it used cables to lift the bucket. The cables enabled the Hydrohoe to lift bigger loads, which Bucyrus thought would make the machine robust enough for its customers. However, <strong>the Hydrohoe still didn\u2019t have enough capacity or reach for Bucyrus\u2019s customers, so the product languished<\/strong> on the market for 10 years and the company eventually resumed selling cable excavators.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Disruptive Business Model: Invading Existing Market<\/strong><\/h3>\n\n\n\n<p>Over time, backhoes improved and significantly increased bucket capacity\u2014from \u215c cubic yard in 1955 to 10 cubic yards in 1974. <strong>With improved capacity, hydraulic backhoes ascended into the traditional cable excavator market<\/strong> as industry disruptors.<\/p>\n\n\n\n<p>Once hydraulic excavators improved enough to satisfy cable excavators\u2019 customers, the performance attributes that customers valued began to shift. Put another way, now that both models were good enough to get the job done, increased capacity was no longer a <a href=\"https:\/\/www.shortform.com\/blog\/business-competitive-advantage\/\">competitive advantage<\/a>.&nbsp;<\/p>\n\n\n\n<p><strong>With their capacity needs satisfied, customers started making <a href=\"https:\/\/www.shortform.com\/blog\/buying-decision\/\">buying decisions<\/a> based on reliability instead of capacity.<\/strong> (We\u2019ll talk more about this concept in Chapter 9.) Hydraulic excavators didn\u2019t carry the risk of having a cable snap while carrying a heavy load, so they began to pull ahead of cable excavators.<\/p>\n\n\n\n<p>At this point, established firms\u2019 businesses started to take a hit. Some firms adapted by looking to industry disruptors and developing hybrids like the Hydrohoe, but all of them treated hydraulic technology as a <em>sustaining<\/em> innovation that could improve their products to market to their existing customers. All but four of the companies ultimately failed.&nbsp;<\/p>\n\n\n\n<p>By contrast, the entrant companies had framed hydraulics as <em>industry disruptors <\/em>and targeted an emerging market. In other words, the <strong>entrants found a market to match the technology, while the established firms tried to adapt the technology to meet their market.<\/strong> Even though the industry disruptors eventually entered the traditional market, the entrants had certain advantages because they started in the emerging market and expanded upmarket.&nbsp;<\/p>\n\n\n\n<p>During the two decades that the startups were serving the emerging market, the companies developed expertise in designing, improving, and selling the products. By the time they entered the traditional excavator market, that experience gave them an advantage over the established firms. That was the long game of their disruptive business models.&nbsp;<\/p>\n\n\n\n<h4 class=\"wp-block-heading\"><strong>Excavator Companies Listened to Their Customers\u2014And It Cost Them<\/strong><\/h4>\n\n\n\n<p>Cable excavator manufacturers didn\u2019t fail because hydraulic technology exceeded their capabilities or because they were oblivious about their customers\u2019 needs. Rather, the companies failed because they were tuned into their customers\u2019 needs, and hydraulic excavators didn\u2019t make sense for their customers\u2014and, thus, for their profits. <strong>The established companies had to focus their resources on staying competitive in their market.<\/strong>&nbsp;<\/p>\n\n\n\n<p>Ironically, these decisions based on the companies\u2019 survival cost many firms their entire businesses. In the next chapter, we\u2019ll talk about how an organization\u2019s past success creates barriers to adopting disruptive innovations.&nbsp;<\/p>\n","protected":false},"excerpt":{"rendered":"<p>What are some industry disruptors? What forms do disruptive business models take? Industry disruptors are best understood in the context of case studies. The excavator industry offers examples of disruptive business models. Read on to understand disruptive business models and industry disruptors through the excavator industry.<\/p>\n","protected":false},"author":6,"featured_media":17147,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[81,104],"tags":[141],"class_list":["post-16734","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-economics","category-marketing","tag-the-innovators-dilemma","","tg-column-two"],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v24.3 (Yoast SEO v24.3) - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Industry Disruptors: Excavator Case Study - Shortform Books<\/title>\n<meta name=\"description\" content=\"Did you know that you can find industry disruptors in any sector? This case study shows disruptive business models for excavator companies.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.shortform.com\/blog\/industry-disruptors\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Industry Disruptors: Excavator Case Study\" \/>\n<meta property=\"og:description\" content=\"Did you know that you can find industry disruptors in any sector? This case study shows disruptive business models for excavator companies.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.shortform.com\/blog\/industry-disruptors\/\" \/>\n<meta property=\"og:site_name\" content=\"Shortform Books\" \/>\n<meta property=\"article:published_time\" content=\"2020-10-31T03:23:00+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2020-11-07T18:56:14+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/s3.amazonaws.com\/wordpress.shortform.com\/blog\/wp-content\/uploads\/2020\/10\/innovators-dilemma-industry-disruptors.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"826\" \/>\n\t<meta property=\"og:image:height\" content=\"535\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"Rina Shah\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Rina Shah\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"3 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\/\/www.shortform.com\/blog\/industry-disruptors\/#article\",\"isPartOf\":{\"@id\":\"https:\/\/www.shortform.com\/blog\/industry-disruptors\/\"},\"author\":{\"name\":\"Rina Shah\",\"@id\":\"https:\/\/www.shortform.com\/blog\/#\/schema\/person\/d07435826f13a8f422d5d333dceac287\"},\"headline\":\"Industry Disruptors: Excavator Case Study\",\"datePublished\":\"2020-10-31T03:23:00+00:00\",\"dateModified\":\"2020-11-07T18:56:14+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\/\/www.shortform.com\/blog\/industry-disruptors\/\"},\"wordCount\":595,\"commentCount\":0,\"publisher\":{\"@id\":\"https:\/\/www.shortform.com\/blog\/#organization\"},\"image\":{\"@id\":\"https:\/\/www.shortform.com\/blog\/industry-disruptors\/#primaryimage\"},\"thumbnailUrl\":\"https:\/\/www.shortform.com\/blog\/wp-content\/uploads\/2020\/10\/innovators-dilemma-industry-disruptors.jpg\",\"keywords\":[\"The Innovator's Dilemma\"],\"articleSection\":[\"Economics\",\"Marketing\"],\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"CommentAction\",\"name\":\"Comment\",\"target\":[\"https:\/\/www.shortform.com\/blog\/industry-disruptors\/#respond\"]}]},{\"@type\":\"WebPage\",\"@id\":\"https:\/\/www.shortform.com\/blog\/industry-disruptors\/\",\"url\":\"https:\/\/www.shortform.com\/blog\/industry-disruptors\/\",\"name\":\"Industry Disruptors: Excavator Case Study - Shortform Books\",\"isPartOf\":{\"@id\":\"https:\/\/www.shortform.com\/blog\/#website\"},\"primaryImageOfPage\":{\"@id\":\"https:\/\/www.shortform.com\/blog\/industry-disruptors\/#primaryimage\"},\"image\":{\"@id\":\"https:\/\/www.shortform.com\/blog\/industry-disruptors\/#primaryimage\"},\"thumbnailUrl\":\"https:\/\/www.shortform.com\/blog\/wp-content\/uploads\/2020\/10\/innovators-dilemma-industry-disruptors.jpg\",\"datePublished\":\"2020-10-31T03:23:00+00:00\",\"dateModified\":\"2020-11-07T18:56:14+00:00\",\"description\":\"Did you know that you can find industry disruptors in any sector? 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