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I Don't View It As Mystic. I Believe That God Is Our Father. He Created Us. He Is Powerful Because He Knows Everything. Therefore Everything I Learn That Is True Makes Me More Like My Father In Heaven. When Science Seems To Contradict Religion, Then One, The Other, Or Both Are Wrong, Or Incomplete. Truth Is Not Incompatible With Itself. When I Benefit From Science It's Actually Not Correct For Me To Say It Resulted From Science And Not From God. They Work In Concert.

-Clayton Christensen

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Clayton Christensen

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I Don't View It As Mystic. I Believe That God Is Our Father. He Created Us. He Is Powerful Because He Knows Everything. Therefore Everything I Learn That Is True Makes Me More Like My Father In Heaven. When Science Seems To Contradict Religion, Then One, The Other, Or Both Are Wrong, Or Incomplete. Truth Is Not Incompatible With Itself. When I Benefit From Science It's Actually Not Correct For Me To Say It Resulted From Science And Not From God. They Work In Concert.

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I Was Lucky Enough To Build On The Work Of A Number Of People Who Had Already Run Laps Around This Theory-building Track. The Original Classification Scheme, Years Ago, Distinguished Radical From Incremental Change. The Theory Said That Established Firms Managed Incremental Change Well, But Would Be Expected To Founder When Their Industry Encountered A Radical Change.

In A Large Successful Company Where Your Power Base As Ceo Isn't All That Secure, It's Hard For A Ceo To Pursue A Truly Disruptive Strategy.

We Have Found That Companies Need To Speak A Common Language, Because Some Of The Suggested Ways To Harness Disruptive Innovation Are Seemingly Counter-intuitive. If Companies Don't Have That Common Language, It Is Hard For Them To Come To Consensus On A Counter-intuitive Course Of Action.

In The Study Of Management, Unfortunately, Many Writers Have Been So Anxious To Articulate A Theory In The Form Of, "if You Do This, This Will Result," That They Never Go Through This Careful Effort.

Every Disruptive Innovation Is Powered By A Simplifying Technology, And Then The Technology Has To Get Embedded In A Different Kind Of A Business Model. The First Two Decades Of Digital Computing Were Characterized By The Huge Mainframe Computers That Filled A Whole Room, And They Had To Be Operated By Phd Computer Scientists. It Took The Engineers At Ibm About Four Years To Design These Mainframe Computers Because There Were No Rules. It Was An Intuitive Art And Just By Trial And Error And Experimentation They Would Evolve To A Computer That Worked.

People Still Cling To This Belief That Innovation Is Just Random And Unpredictable. But If You Look Closely, There Are Some Real Patterns. The Companies That Recognize And Take Advantage Of Those Patterns Have The Real Opportunity To Create Competitive Advantage.

By The Time It Becomes Obvious That A Technology Will Have Truly Disruptive Impact, It Is Often Too Late To Take Action. This Is One Reason Why We Are Such Advocates Of Using Theory To Try To Analyze Industry Change. Conclusive Evidence That Proves That A Company Needs To Take Action Almost Never Exists. In Fact, The Data Can Fool Management, Lulling Them Into A False Sense Of Security.

Management Has To Provide The Coordinating Mechanism Between What The Supplier Provides And What The User Needs In Not-good-enough Situations Where Product Architecture Is Consequently Interdependent. Management Always Beats Markets When There Is Not Sufficient Information.

Not Good Enough

One Quarter Of Medicare Beneficiaries Have Five Or More Chronic Conditions, Sees An Average Of 13 Physicians Each Year, And Fills 50 Prescriptions Per Year.

The Answer Is The Disruptive Innovator, An Outsider, Who Creates A Product Or Service For The Non-existing Consumer In A Non-existing Market For Almost No Profit.

In 15 Years From Now Half Of Us Universities May Be In Bankruptcy ... In The End I'm Excited To See That Happen. So Pray For Harvard Business School If You Wouldn't Mind.

Innovation Simply Isn't As Unpredictable As Many People Think. There Isn't A Cookbook Yet, But We're Getting There.

Steve Jobs And Apple Taught Us That Profit Is Not The Ultimate Goal, But Rather A Consequence Of Something Greater.

When Product Performance Outstrips The Ability Of Customers To Use That Performance In An Industry, The Competitive Game Changes. Under Those Circumstances You Have To Decouple Components Businesses From Assembly Businesses.

Because Of The Disruption Phenomenon - Technological Progress Outstripping The Ability Of Customers To Utilize It - The General Tendency Is For The Money To Migrate Toward The Subsystems.

Its Actually Really Important That You Succeed At What Youre Succeeding At, But That Isnt Going To Be The Measure Of Your Life.

In The First Stage Of Insight-building, All That Researchers Can Do Is Observe Phenomena. Second, They Classify The Phenomena In A Way That Helps Them Simplify The Apparent Complexities Of The World So They Can Ignore The Meaningless Differences And Draw Connections Between The Things That Really Seem To Matter. Third, Based On The Classification System, They Propose A Theory. The Theory Is A Statement Of What Causes What And Why, And Under What Circumstances.

There Needs To Be Conviction And Action Behind Rules.

There Are Other Dimensions Of Biotechnology. If You Think Of Biotechnology Like The Internet, It's Not A Category - It's An Infrastructure That Can Be Deployed To Sustain Or Disrupt. In Health Care, The Most Complex Problems At The High End Have To Be Dealt With In A Problem-solving Mode By The Best, Most Experienced Physicians You Can Find.

I've Concluded That The Metric By Which God Will Assess My Life Isn't Dollars, But The Individual People Whose Lives I've Touched. I Think That's The Way It Will Work For Us All. Don't Worry About The Level Of Individual Prominence You Have Achieved; Worry About The Individuals You Have Helped Become Better People.

Investing In Our People Is Going To Be Costly And Scarce - We Need To Start Doing That!

One Reason There Are So Many Short-lived Management Fads Is That Their Prescriptions Were Derived And Advocated In Precisely This Way. So Managers Read About A Fad And Try It, Find That It Doesn't Work, Abandon The Effort, And Move On To The Next Thing. In Reality, It Is Usually The Case That The Faddish Prescription Was Indeed Sound Advice In Certain Circumstances, But Actually Was Poor Advice In Other Circumstances.

I've Concluded That The Metric By Which God Will Assess My Life Isn't Dollars But The Individual People Whose Lives I've Touched.

What You Need Is A Fundamental Humility - The Belief That You Can Learn From Anyone.

Core Competence, As It Is Used By Many Managers, Is A Dangerously Inward-looking Notion. Competitiveness Is Far More About Doing What Customers Value Than Doing What You Think You're Good At.

It Is When The Product Is Not Good Enough That Proprietary Integration Gives You A Competitive Edge. You Cannot Outsource And Be Competitively Successful In This Situation. But At The Other End, Where Standard Components Assembled In Standard Ways Can Yield Acceptable Performance, You Must Outsource.

When A Technology, Regardless Of How Different And Difficult It Is, Sustains The Trajectory Of Performance Improvement, My Research Asserts That The Leaders In The Prior Generation Of Technology Are Likely To End Up On Top Of Their Industry At The End Of The Transition.

If You Study The Root Causes Of Business Disasters, Over And Over You'll Find This Predisposition Toward Endeavors That Offer Immediate Gratification.

We Decided That Humility Was Defined Not By Self-deprecating Behavior Or Attitudes But By The Esteem With Which You Regard Others... Generally, You Can Be Humble Only If You Feel Really Good About Yourself - And You Want To Help Those Around You Feel Really Good About Themselves, Too.

To Prop Up The Stock Price, Managers Have To Turn Down The Screws On Everybody. That Forces Them To Cancel All The Projects That Would Lead To Future Growth In Order To Drop Money To The Bottom Line. This Is Hp's Dilemma Today. Once A Company's Growth Has Stopped, The Game As We Have Known It Is Over. It's A Scary Thing.

How Can You Make Sense Of The Future When You Only Have Data About The Past?

I Have Continued Systematically To Study The Book Of Mormon And Bible To Understand Even More Deeply What God Expects Of Me And My Family While On This Earth.

Questions Are Places In Your Mind Where Answers Fit. If You Haven't Asked The Question, The Answer Has Nowhere To Go. It Hits Your Mind And Bounces Right Off. You Have To Ask The Question - You Have To Want To Know - In Order To Open Up The Space For The Answer To Fit.

Most Companies Think Of Disruption As A Threat. But Disruptive Innovations Have Tremendous Growth Potential. If Incumbent Companies Can Learn How To Harness The Forces Of Disruption, They Too Can Improve Their Ability To Create New-growth Businesses.

You Can't Find Returns In Investments You Haven't Made.

Motivation Is The Catalyzing Ingredient For Every Successful Innovation. The Same Is True For Learning.

The Whole Enterprise Of Teaching Managers Is Steeped In The Ethic Of Data-driven Analytical Support. The Problem Is, The Data Is Only Available About The Past. So The Way Weve Taught Managers To Make Decisions And Consultants To Analyze Problems Condemns Them To Taking Action When Its Too Late.

The Mistake Managers Often Make Is Defining Their Industry Too Narrowly. Digital's Market Share In The Minicomputer Market Stayed Very Robust Even As It Fell Off The Cliff. Disruption Seems To Come Out Of Nowhere, But If You Know What To Look For, You Can Spot Important Developments Well Before The Market Does.

There Are Direct Paths To A Successful Career. But There Are Plenty Of Indirect Paths, Too.

You May Hate Gravity, But Gravity Doesn't Care.

Every Time You Take Someone Figuratively By The Hand And Introduce Him Or Her To Jesus Christ, You Will Feel How Deeply Our Savior Loves You And Loves The Person Whose Hand Is In Yours.

If You Just Look At The Data, You Are Led To Believe That Things Are Getting Better, Rather Than Worse. That's Why The Fall Is Really Precipitous, Once You Hit The Ceiling.

The Personal Computer Was A Disruptive Innovation Relative To The Mainframe Because It Enabled Even A Poor Fool Like Me To Have A Computer And Use It, And It Was Enabled By The Development Of The Micro Processor. The Micro Processor Made It So Simple To Design And Build A Computer That Ib Could Throw In Together In A Garage. And So, You Have That Simplifying Technology As A Part Of Every Disruptive Innovation. It Then Becomes An Innovation When The Technology Is Embedded In A Different Business Model That Can Take The Simplified Solution To The Market In A Cost-effective Way.

Decide What You Stand For. And Then Stand For It All The Time.

Breaking An Old Business Model Is Always Going To Require Leaders To Follow Their Instinct. There Will Always Be Persuasive Reasons Not To Take A Risk. But If You Only Do What Worked In The Past, You Will Wake Up One Day And Find That You’ve Been Passed By.

Generally, The Technology That Enables Disruption Is Developed In The Companies That Are The Practitioners Of The Original Technology. That's Where The Understanding Of The Technology First Comes Together. They Usually Can't Commercialize The Technology Because They Have To Couple It With The Business Model Innovation, And Because They Tend To Try To Take All Of Their Technologies To Market Through Their Original Business Model, Somebody Else Just Picks Up The Technology And Changes The World Through The Business Model Innovation.

The Only Useful Information About The Market Will Be What I Create Through Expeditions Into The Market, Through Testing And Probing, Trial And Error, By Selling Real Products To Real People Who Pay Real Money.

If You Defer Investing Your Time And Energy Until You See That You Need To, Chances Are It Will Already Be Too Late.

Investing Your Time

In Our Lives And In Our Careers, Whether We Are Aware Of It Or Not, We Are Constantly Navigating A Path By Deciding Between Our Deliberate Strategies And The Unanticipated Alternatives That Emerge.

We Don't Hire Ministers Or Priests To Teach And Care For Us. This Forces Us To Teach And Care For Each Other - And In My View, This Is The Core Of Christian Living As Christ Taught It.

If The Technology Is Disruptive, On The Other Hand, The Odds Are That At The End Of The Transition, The Leaders Will Have Been Toppled And New Companies Will Be On Top.

An Innovation Will Get Traction Only If It Helps People Get Something That They're Already Doing In Their Lives Done Better.

As I Have Studied The Bible And The Book Of Mormon, I Have Come To Know Through The Power Of The Spirit Of God, That These Books Contain The Fullness Of The Gospel Of Jesus Christ.

A Lot Has Been Written About The Internet Bust. From My Point Of View, It's Quite Clear The Internet Isn't A Category; The Internet Is A Technological Infrastructure That Can Be Deployed To Facilitate A Disruptive Business Model Or A Sustaining Business Model.

Each Of Our Children During Their High School Years Went To 'early Morning Seminary' - Scripture Study Classes That Met In The Home Of A Church Member Every School Day Morning From 6:30 Until 7:15.

I Have Healed The Sick By The Power Of The God. I Have Spoken With The Gift Of Tongues.

My Conclusion: Management Is The Most Noble Of Professions If It's Practiced Well. No Other Occupation Offers As Many Ways To Help Others Learn And Grow, Take Responsibility And Be Recognized For Achievement, And Contribute To The Success Of A Team.

Government Mandates, Incidentally, Are Likely To Distort Rather Than Solve The Problem Of Finding A Market. I Would, Therefore, Force My Organization To Live By Its Wits Rather Than To Rely On Capricious Subsidies Or Non-economic-based Regulation To Fuel My Business.

One Of The Factors That Make Great Companies So Great Is That They Have Processes That Allow Them To Solve Difficult Problems Again And Again. These Processes Have Developed Over Time As Teams Have Successfully Wrestled With A Certain Type Of Challenge. Eventually, People Begin To Say, "this Is Just How We Do Something Around Here." The Problem Develops When That Team Then Has To Solve A Very Different Set Of Challenges. The Processes That Are Such Strengths Can Be Crushing Liabilities.

Christine And I Haven't Raised Our Children. A Whole Community Of Selfless Christians Has Contributed To Helping Them Become Faithful, Competent Adults.

We Are All Trained To Be Data Driven People, But No Hard Data Exist About The Future. Therefore, The Only Way To Look Into The Future With Any Degree Of Accuracy Is To Use Theory, Statements Of What Causes What And Why. If Executives Have The Right Theories In Their Heads, They Can Very Quickly Interpret Market Developments. They Can Identify What Matters And Why, And Act Accordingly. So We Suggest Decision-makers Should Start By Gaining A Deep Understanding Of The Relevant Collection Of Theories, And Then Be Alert For Signals That Indicate Certain Types Of Developments.

It's Like In Biological Evolution: The Population Will Evolve, Even Though Individuals Can't. The Same Thing Happens In The Corporate World: The Population Of Business Units Within Corporations Evolves, Even Though Individual Business Units Can't. That's Because The Capabilities Of Business Units Reside In Their Processes And Their Values, And By Their Very Nature, Processes And Values Are Inflexible And Meant Not To Change.

If A Company Truly Wants To Resolve The Innovator's Dilemma, It Does Need To Be Able To Create Wave After Wave Of Disruptive Innovation. And Those Disruptive Innovations Will Typically Grow To The Point Where They Do Cause Some Pain For Leading Companies. But Most Disruptive Innovations Create Substantial New Growth Before They Cause That Pain.

Purpose Must Be Deliberately Conceived And Chosen, And Then Pursued.

Focus Is Scary—until You Realize That It Only Means Turning Your Back On Markets You Could Never Have Anyway. Sharp Focus On Jobs That Customers Are Trying To Get Done Holds The Promise Of Greatly Improving The Odds Of Success In New-product Development.

Many Think Of Management As Cutting Deals And Laying People Off And Hiring People And Buying And Selling Companies. That's Not Management, That's Deal Making. Management Is The Opportunity To Help People Become Better People. Practiced That Way, It's A Magnificent Profession.

You Can Invest To Create The New Growth Business While The Core Business Is Still Growing, Because New Business Units Don't Need To Get Big Fast. But When The Core Business Stops Growing, Investing To Create New Growth Businesses Becomes Impossible.

Because If The Decisions You Make About Where You Invest Your Blood, Sweat, And Tears Are Not Consistent With The Person You Aspire To Be, You’ll Never Become That Person.

Decisions You Make

At The Beginning Of Almost Every Industry, The Available Products And Services Are So Expensive To Own And Complicated To Use That Only People With A Lot Of Money And A Lot Of Skill Have Access To Them. A Disruptive Technology Is An Innovation That Simplifies The Product And Makes It So Affordable That A Whole New Population Of People Can Now Have One And Use It At The Beginning For Simple Applications, And Then It Improves To The Point That It Makes The Old Technology Obsolete.

Capitalism Has Taught Us That Markets Are Always More Efficient Than Hierarchical Managerial Coordination. But In A Situation Where Those Three Conditions Aren't Met, I Can't Outsource Or Partner With You Because Markets Don't Function In The Absence Of Sufficient Information.

Only The General Manager Can Mold The Resources, Processes, And Values That Affect Innovation , Into A Coherent Capability To Develop And Launch Superior New Products And Services Repeatedly.

If You Ask The Average Guy On The Street To Name Five Companies That Have Truly Transformed Themselves Over The Few Decades, Hewlett-packard Would Be On Everybody's List. You'd Also Put On This List Ge And Johnson & Johnson.

In General, The Questions That Are On Our Mind Are The Same Questions That Have Been Driving Our Work Over The Past Decade. How Do We Bring Order To This Messy, Unpredictable World Of Innovation? How Can We Dramatically Improve The Chances Of Creating A Successful New-growth Business? How Can We Do This Again And Again? More Specifically, It Has Become Very Clear That The Fundamental Paradigms Of Market Segmentation And Branding Are Badly Broken - And We're Working On Developing More Useful Theories For These Dimensions Of Innovation.

Justification For Infidelity And Dishonesty In All Their Manifestations Lies In The Marginal Cost Economics Of “just This Once.

The Biggest Mistake Is An Over-reliance On Data. Managers Will Say If There Are No Data They Can Take No Action. However, Data Only Exist About The Past. By The Time Data Become Conclusive, It Is Too Late To Take Actions Based On Those Conclusions.

When I Have My Interview With My God, Our Conversation Will Focus On The Individuals Whose Self-esteem I Was Able To Strengthen, Whose Faith I Was Able To Reinforce, And Whose Discomfort I Was Able To Assuage—a Doer Of Good, Regardless Of What Assignment I Had. These Are The Metrics Of That Matter In Measuring My Life. This Realization, Which Occurred Nearly Fifteen Years Ago, Guided Me Every Day To Seek Opportunities To Help People In Ways Tailored To Their Individual Circumstances. My Happiness And My Sense Of Worth Has Been Immeasurably Improved As A Result.

I Have Been Blessed To See Visions Of Eternity; And Events In My Future That Have Been Important For Me To Foresee, Have Been Revealed To Me.

Intimate, Loving, And Enduring Relationships With Our Family And Close Friends Will Be Among The Sources Of The Deepest Joy In Our Lives.

Because We Employ No Professional Preachers, It Means That Every Sermon Or Lesson In Church Is Given By A Regular Member - Women And Men, Children And Grandparents.

Almost Always Great New Ideas Don't Emerge From Within A Single Person Or Function, But At The Intersection Of Functions Or People That Have Never Met Before.

If You Want To Make Better Theory, You've Got To Use The Best That's Available And Look Through The Lens Of Another Discipline To See If You Can Uncover More Anomalies. By Looking At The Phenomena Of Failure From The Perspective Of Sales, Marketing, Finance, General Management, And The Equity Markets, I Was Able To See Things That Rebecca [henderson] Hadn't.

History Is Littered With Great Firms That Got Killed By Disruption. Of Course, The Personal Computer, A Technology That First Took Root As A Toy, Got Digital Equipment Corporation. Kodak Missed The Boat For A Long Time On Digital Imaging. Sony Was Slow To Get Mp3 Technology. Microsoft Doesn't Know What To Do With Open Source Software. And So On.

And If Your Attitude Is That Only Smarter People Have Something To Teach You, Your Learning Opportunities Will Be Very Limited. ... When We See People Acting In An Abusive, Arrogant, Or Demeaning Manner Toward Others, Their Behavior Almost Always Is A Symptom Of Their Lack Of Self-esteem. They Need To Put Someone Else Down To Feel Good About Themselves.

The Innovations Are Far More Important Because The Technology Itself Has Now Way To Impact The World For Good Until It's Embedded In The Business Model. Innovation It's The Combination Of The Simplifying Technology And The Business Model.

Disruptive Innovations Create Jobs, Efficiency Innovations Destroy Them.

Businesses Want To Think In Terms Of Categories. Consumers Want Us To Think In Terms Of Their Needs.

Often They [writers On The Study Of Management] Have A Point Of View Based Upon Intuition And Experience. They Then Offer A Cadence Of Two-paragraph Examples Carefully Selected To "prove" Their Theory, And Then They Write "one Size Fits All" Books. The Message Is, "if You'd Do What These Companies Did, You'd Be Successful Too."

If I Know What To Spec, And I Can Measure It, And There Are No Unpredictable Interdependencies Between What You Do And What I Must Do In Response, Then An Economist Would Say That Is Sufficient Information For A Market To Emerge Between You And Me.

Between You And Me

The Path I Am Trying So Hard To Follow Is In Fact The One That God My Father And His Son Jesus Christ Want Me To Pursue. It Has Brought Me Deep Happiness.

Efficiency Innovations Provide Return On Investment In 12-18 Months. Empowering Innovations Take 5-10 Years To Yield A Return. We Have Ample Capital - Oceans Of Capital - That Is Being Reinvested Into Efficiency Innovation.

But Actually Theory Is Very Practical. Gravity Is A Theory, For Example. It Allows You To Predict That If You Step Off A Cliff You Will Fall; You Don't Have To Collect Data On That.

Think About The Metric By Which Your Life Will Be Judged, And Make A Resolution To Live Every Day So That In The End, Your Life Will Be Judged A Success.

In Most Instances, Biotechnology, Though A Radically Different Approach, Is A Sustaining Technology: It's A Dramatically Improved Way Of Targeting Problems That We Hadn't Been Able To Solve With The Conventional Approach Of Mainstream Pharmaceutical Companies.

Whenever We Have Thanked These Men And Women For What They Have Done For Us, Without Exception They Have Expressed Gratitude For Having The Chance To Help - Because They Grew As They Served.

...it's Easier To Hold To Your Principles 100% Of The Time Than It Is To Hold To Them 98% Of The Time.

You Can Talk All You Want About Having A Clear Purpose And Strategy For Your Life, But Ultimately This Means Nothing If You Are Not Investing The Resources You Have In A Way That Is Consistent With Your Strategy. In The End, A Strategy Is Nothing But Good Intentions Unless It's Effectively Implemented.

Watching How Customers Actually Use A Product Provides Much More Reliable Information Than Can Be Gleaned From A Verbal Interview Or A Focus Group.

Lets Take The Best Of Our Ideas From Global Drucker Forum, And The Best Of Our Language, And Then Focus And Clarify.

The Important Thing Is That Over Time, Scientific Progress Transforms Things That Used To Have To Be Dealt With In A Problem-solving Mode Down To The Pattern-recognition Space; And From Pattern Recognition Into The Rules-based Mode. This Is The Mechanism By Which Less-trained People Are Enabled To Do More Sophisticated Things. This Is Always The Way Disruption Happens. It Enables A Larger Population Of Less-experienced People To Do More Sophisticated Things.

Don't Worry About The Level Of Individual Prominence You Have Achieved; Worry About The Individuals You Have Helped Become Better People.

The Best Strategy Is A Balance Between Having A Deliberate One, And A Flexible, Or Emergent Strategy.

Year After Year After Year, People Write Books About Managing Innovation Or About Leadership, For Example, Without Ever Going Through The Pain Of Saying, "this Kind Of Leadership Will Cause This Result In These Circumstances And A Very Different Result In Those Circumstances." This Is Academic Malpractice Of The Worst Kind.

I Don't View It As Mystic. I Believe That God Is Our Father. He Created Us. He Is Powerful Because He Knows Everything. Therefore Everything I Learn That Is True Makes Me More Like My Father In Heaven. When Science Seems To Contradict Religion, Then One, The Other, Or Both Are Wrong, Or Incomplete. Truth Is Not Incompatible With Itself. When I Benefit From Science It's Actually Not Correct For Me To Say It Resulted From Science And Not From God. They Work In Concert.

Regulatory Fiat Cannot Create A Market At A Technologically Interdependent Interface. And By The Same Token, Regulation And So-called Monopoly Power Rarely Prevail At Modular Interfaces Between Stages Of Value-added Technology.

Another Thing I've Observed Is How Critical The Role Of The Ceo Is When A Technology Truly Is Disruptive. In Looking Back On Companies That Have Successfully Launched Independent Disruptive Business Units, The Ceo Always Had A Foot In Both Camps. Never Have They Succeeded When They Spin Something Off In Order To Get It Off The Ceo's Agenda. The Ceos That Did This Had Extraordinary Personal Self-confidence, And Almost Always They Were The Founders Of The Companies.

Self Confidence

There Are More Than 9,000 Billing Codes For Individual Procedures And Units Of Care. But There Is Not A Single Billing Code For Patient Adherence Or Improvement, Or For Helping Patients Stay Well.

In My First Career I Had Founded My Own Company, With A Group Of Mit Professors, Before Coming To Harvard To Finish My Doctorate, And So I Had A Deep Respect For The Brains, Talent, And Dedication Of Managers. That Made It Hard For Me To Believe The Attributions In The Business Press That Stupid Management Was To Blame. So I Looked Elsewhere For An Explanation.

If You Take Away Religion, You Can't Hire Enough Police.

Because These Firms Listened To Their Customers, Invested Aggressively In New Technologies That Would Provide Their Customers More And Better Products Of The Sort They Wanted, And Because They Carefully Studied Market Trends And Systematically Allocated Investment Capital To Innovations That Promised The Best Returns, They Lost Their Positions Of Leadership.

Children Build Self-esteem By Doing Things That Are Hard And Learning What Works.

Things That Are Hard

Ultimately, When You Come Up With A Classification Scheme That Is Collectively Exhaustive And Mutually Exclusive, Then The Theory Can Become What Kuhn Called A Paradigm.

The Reason Why It Is So Difficult For Existing Firms To Capitalize On Disruptive Innovations Is That Their Processes And Their Business Model That Make Them Good At The Existing Business Actually Make Them Bad At Competing For The Disruption. Companies In Fact Are Specifically Organized To Under-invest In Disruptive Innovations! This Is One Reason Why We Often Suggest That Companies Set Up Separate Teams Or Groups To Commercialize Disruptive Innovations. When Disruptive Innovations Have To Fight With Other Innovations For Resources, They Tend To Lose Out.

The Outsourcing Gurus Have Been Driving The Theory, And They Are Saying Everybody Ought Always To Do This. But It Is Really Contingent On Where You Are On The Spectrum From "not Good Enough" To "more Than Good Enough," Relative To Each Tier Of The Market.

Not Good Enough

Doing Deals Doesn't Yield The Deep Rewards That Come From Building Up People.

Disruptive Technology Is A Theory. It Says This Will Happen And This Is Why; It's A Statement Of Cause And Effect. In Our Teaching We Have So Exalted The Virtues Of Data-driven Decision Making That In Many Ways We Condemn Managers Only To Be Able To Take Action After The Data Is Clear And The Game Is Over. In Many Ways A Good Theory Is More Accurate Than Data. It Allows You To See Into The Future More Clearly.

It Is A Company's Customers Who Effectively Control What It Can And Cannot Do.

If The Theory Accurately Predicts What They [scientists] See, It Confirms That It's A Good Theory. If They See Something That The Theory Didn't Lead Them To Believe, That's What Thomas Kuhn Calls An Anomaly. The Anomaly Requires A Revised Theory - And You Just Keep Going Through The Cycle, Making A Better Theory.

How Could Digital's Collapse Be So Precipitous? It's Because, In Many Ways, Financial Performance Data Is Misleading. As You Move Up To The Top Of The Market, You're Getting Rid Of The Less Profitable Products At The Low End And Adding Business With More Attractive Margins At The High End. The Rate Of Unit Volume Growth Might Be Tapering Off As You Pursue These Smaller Markets, But Your Margins Actually Look Better. So Wall Street Rewards Your Stock Price Until You Hit The Ceiling.

I've Concluded That Getting The Categories Right Is An Absolutely Crucial Step To Building Useful Management Theory, And Unfortunately Too Few Writers Do This. You've Got To Engage In Serious Scholarship, And Then Figure Out How To Write It In A Way That Lots Of People Can Understand.

Disruption Is, At Its Core, A Really Powerful Idea, But Everyone Hijacks The Idea To Do Whatever They Want Now.

The Transformation At The Corporate Level Was Achieved By Selling Off Business Units In Old Markets And By Creating New Business Units To Pursue The New Opportunities. But The Individual Business Units Themselves Within Those Transformed Corporations Were Almost Inert To Change.

When The Functionality Of A Product Or Service Overshoots What Customers Can Use, It Changes The Way Companies Have To Compete. When The Product Isn't Yet Good Enough, The Way You Compete Is By Making Better Products. In Order To Make Better Products, The Architecture Of The Product Has To Be Interdependent And Proprietary In Character.

Management Is The Most Noble Of Professions If It's Practiced Well.

Quite Often Startups Were First Out Of The Gate With A Sustaining Technology. But Somehow The Leaders Got The Technology And Stayed Atop Their Industries. Sometimes They Acquired The Startup; Sometimes They Just Developed The Technology As A Follower And Used Their Muscle And Mass To Win. But They Always Won.

There's Usually Some Process By Which A Potentially Great Idea Gets Prostituted Into Something Lacklustre, Or By Which The Wrong Idea Gets Put Forward.

Innovation Almost Always Is Not Successful The First Time Out. You Try Something And It Doesn't Work And It Takes Confidence To Say We Haven't Failed Yet. Ultimately You Become Commercially Successful.

This Is One Of The Innovator’s Dilemmas: Blindly Following The Maxim That Good Managers Should Keep Close To Their Customers Can Sometimes Be A Fatal Mistake.

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