Disruptive innovation is a term that describes a new technology or business model that fundamentally changes how a company operates. Disruptive innovations often begin by targeting niche markets where existing products or services do not exist and gradually progress to disrupt the mainstream market of disruptive innovation.
How Disruptive Innovation Expands
The first personal computer was a small and simple machine that hobbyists and researchers often used. However, as technology improved and the cost of computers fell, personal computers began to take over the market for business and personal use.
Eventually, personal computers became so powerful and cheap that they replaced mainframe computers as the primary tool for data processing. Another example of disruptive innovation is the smartphone. The first cell phones were expensive and limited in their capabilities, but as technology improved and the price dropped, they began to take over the mobile market.
Cell phones eventually became so powerful and versatile that they replaced traditional cell phones and became the primary device for many other activities, such as browsing the Internet and social media and even replacing cameras, music, and many other applications.
Effects on Economy Sharing Companies
Disruptive innovations can also be seen in the sharing economy, such as companies like Uber and Airbnb. These companies use technology to connect people who want a ride or accommodation with people who have a car or storage. This company’s economy sharing has disrupted the traditional taxi industry and guesthouses. This disruption is making it easier for people to get around and find accommodation.
Moreover, disruptive innovation often comes from unexpected places, such as startups or small businesses. Large, established companies continually invest in their existing business models and technologies to take the necessary risks to create disruptive innovations.
Disruptive innovation describes a new technology or business process that fundamentally changes how a company operates. Disruptive innovations often begin by targeting niche markets where existing products or services do not exist and gradually progress to disrupt the mainstream market. Examples of disruptive innovations include personal computers, smartphones, and sharing economy platforms such as Uber and Airbnb. Entrepreneurs must be aware of new technologies and business developments to identify and adapt to disruptive innovations and remain competitive.
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