{"id":16756,"date":"2020-11-05T15:50:00","date_gmt":"2020-11-05T19:50:00","guid":{"rendered":"https:\/\/www.shortform.com\/blog\/?p=16756"},"modified":"2020-11-07T15:11:27","modified_gmt":"2020-11-07T19:11:27","slug":"technology-disruptors","status":"publish","type":"post","link":"https:\/\/www.shortform.com\/blog\/technology-disruptors\/","title":{"rendered":"Technology Disruptors: When Do They Work Best?"},"content":{"rendered":"\n

What are technology disruptors? What scenarios create the best environment for tech disruptors?<\/p>\n\n\n\n

A technology disruptor is a new product that changes up the market. Instead of building on something existing by moving to the next phase of the product life cycle, technology disruptors create a new market<\/a> that competes on all phases of the product life cycle<\/a>.<\/p>\n\n\n\n

Read more about technology disruptors and how they work in the context of product life cycles.<\/p>\n\n\n\n\n\n\n\n

Technology Disruptors Are Just Good Enough<\/h2>\n\n\n\n

As we\u2019ve mentioned, technology often advances more rapidly than customers\u2019 demand for bigger, better, faster products. When companies aren\u2019t in tune with their customers\u2019 needs, they continually update their products with new features and performance improvements\u2014and the prices reflect the upgrades. This gap between technology performance and customer demand is called performance oversupply<\/a>. Customers don\u2019t always want the very best; they just want good enough to get the job done.<\/strong><\/p>\n\n\n\n

The problem for established companies is that performance oversupply creates an opening for disruptive technology to forge a place in the market. Tech disruptors that meet customers\u2019 needs and offer lower prices, convenience, and more simplicity can edge existing products\u2014and established firms\u2014out of the market.<\/strong> <\/p>\n\n\n\n

Product Life Cycles<\/strong> for Existing Products<\/h3>\n\n\n\n

Technology oversupply triggers products to enter the next phase in their life cycles. Each phase is characterized by the primary reason customers choose one product over another. The phases include: <\/p>\n\n\n\n

  1. Functionality<\/strong>: Which product does the job best? <\/li>
  2. Reliability<\/strong>: Which product does the job most consistently? <\/li>
  3. Convenience<\/strong>: Which product is easiest to buy and use? <\/li>
  4. Price<\/strong>: Which product is the most affordable? <\/li><\/ol>\n\n\n\n

    Once products satisfy the needs of the current life cycle phase, the product evolves to the next phase. <\/p>\n\n\n\n

    For example, the 3.5-inch disk drive followed close to this model. By the time the drive\u2019s capacity had increased enough to meet the needs of the desktop computer market, the 5.25-inch drives offered almost three times the capacity customers needed. When 3.5-inch drives became good enough<\/em>, desktop makers suddenly had a choice between the two drives. <\/p>\n\n\n\n

    Until that point, capacity\u2014in other words, functionality\u2014had been the main priority. But once both drives met desktop makers\u2019 capacity needs, the 3.5-inch drives\u2019 smaller size attracted the computer makers<\/strong>, because it allowed them to make smaller computers. Within four years of hitting the market, the technology disruptors (3.5-inch drives) captured 60 percent of drive sales. <\/p>\n\n\n\n

    After 3.5-inch drives had gotten as small as desktop makers needed them to be, the focus shifted to the drives\u2019 reliability, and finally to price. At this point, the 3.5-inch drives became a commodity, meaning the product had gone through all four phases of its life cycle. <\/p>\n\n\n\n

    Product Life Cycle Phases for Technology Disruptors<\/strong><\/h3>\n\n\n\n

    Although uncertainties are inherent in developing technology disruptors, companies can make more informed decisions by understanding product life cycles and how they\u2019re impacted by disruptive innovations.<\/p>\n\n\n\n

    In addition to performance oversupply, there are two aspects of tech disruptors that impact product life cycles: <\/p>\n\n\n\n

    1) The features that make the disruptive innovation <\/strong>unattractive<\/em><\/strong> in the existing market are precisely what make it <\/strong>attractive<\/em><\/strong> in the emerging market.<\/strong> For example, the Hydrohoe excavator\u2019s small bucket capacity was unappealing to traditional excavation contractors, but it was perfect for a new market of homebuilders who needed to dig narrow trenches. <\/p>\n\n\n\n

    Established companies often fail because they frame disruptive innovations as technological <\/em>challenges, because they get stuck on the product\u2019s functionality. Established companies tend to think that they must improve the new technology until it meets the existing market\u2019s needs. <\/p>\n\n\n\n

    By contrast, entrant companies succeed because they look beyond functionality alone, understanding that other attributes in the product life cycle attract customers<\/a>, as well. Startups frame disruptive technologies as a marketing<\/em> challenge\u2014they simply have to find the right market<\/a> to fit the product. <\/p>\n\n\n\n

    2) Technology disruptors are typically more reliable, convenient, simple, and affordable than existing products<\/strong>\u2014falling into later stages of the product life cycle\u2014because established companies often fall into the trap of continually improving products to target higher-tier markets. For example, HP\u2019s disruptive effort failed with the 1.3-inch Kittyhawk drive because the company tricked it out with features and functionality to fit PDAs, but it wasn\u2019t simple or affordable enough to meet the needs of the video-game market that emerged.<\/p>\n","protected":false},"excerpt":{"rendered":"

    What are technology disruptors? What scenarios create the best environment for tech disruptors? A technology disruptor is a new product that changes up the market. Instead of building on something existing by moving to the next phase of the product life cycle, technology disruptors create a new market that competes on all phases of the product life cycle. Read more about technology disruptors and how they work in the context of product life cycles.<\/p>\n","protected":false},"author":6,"featured_media":509,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[81,14,104],"tags":[141],"class_list":["post-16756","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-economics","category-management","category-marketing","tag-the-innovators-dilemma","","tg-column-two"],"yoast_head":"\nTechnology Disruptors: When Do They Work Best? - Shortform Books<\/title>\n<meta name=\"description\" content=\"Product improvements are sometimes unncessary. Technology disruptors bring innovation with features that are just good enough. 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