Disruption Theory is Real, but Wrong

Alex Danco, 2019-10-03


  • Dr Clay Christensen was a genius, but his public predictions about tech were terrible.

  • The “Job to be Done” theory (i.e. customers are interested in a solution to their problems and not your product) is better suited for consultants than product development or disruptive businesses.

  • Disruption theory describes something real but it’s generating bad advice.

  • In theory it can use for new market innovations, but the scope is very narrow.

  • Current competition is not “upstart vs incumbent”, but “ecosystem vs incumbent”.

So what’s going on

  • The Disruption Theory gets the process right, but the resolution level – wrong.

  • Today’s disruption is not individual companies disrupting incumbents, it’s business ecosystems disrupting incumbents. Hence the advice is wrong.

  • Christensen’s ideas:

o   Modularity Theory: products start integrated, then for scalability / improvement become modular (compatibility, etc.)

o   Disruption Theory: incumbents do everything right, but some clients don’t need all bells and whistles (i.e. “overserving”), so they go to upstarts, the segment growth, high margins disappear, incumbents suffer. Attempting to fight low-cost upstarts is part of the incumbent’s competencies. Also try to protect their business model with no low-market offerings.

o   Jobs-to-be-Done (JTBD): understand what the customer is really paying for and why they’re buying what they’re buying. (and for what purpose)


  • Current “disruptors” are competing on performance [i.e. provide the same value as incumbents] and going after the high-end customers.

  • Ecosystems can be assembled of smaller individual businesses (sustaining innovation), but collectively they can uproot large incumbents. None of these individual businesses have “disruption” in their playbooks.

  • Ecosystems don’t even have to belong to the same owner (iPhone and Instagram).

  • Ecosystems are modular (Android [instead of iPhone] + Instagram still works).

  • Incumbents have to go high-end or die.

  • Ecosystems are evolving: their modules swap / improve / go out of business.

  • Every given piece of an ecosystem doesn’t want to be a low-cost leader, it focuses on the best UX and the best users.

  • Adoption: a critical mass of top apps and rich users, then trickle down to the rest of us.

  • Christensen’s advice is one level above the practical use for an individual company: it explains the ecosystem but is mute on how it evolves.

  • And a friendly nudge of the Lean Startup. Same issue: low-cost experiments seeking validation help the startup ecosystem, but not the individual company, as success (and death) lies in the commitment and not in the nibbling multiple pies.