DISRUPTIVE CHANGE

Disruptive Change

Abstract

This paper addresses the understanding of disruptive change by highlighting the problems that arise when incumbent companies face disruptive innovations within their markets. In order to generate a new comprehending of the competition that arises through disruptive change, disruptive innovations are connected to the notion of "hyper competition". This concept implies the possibility to disrupt the market by implementing a new strategic orientation called the new "7-S Framework". However this implies the necessity of reorganizing the incumbent firm. A possible approach is introduced. With this paper, we tries to identify a possible method to become disruptive for incumbent firms. The theme is "disruptive change and corporate response to it".

Disruptive Change

Introduction

In today's business world one can often glimpse the phenomenon that giant companies and market leaders got scared to their centers and worst been driven out of their market. Faster information flows, the convergence of markets and therefore a constantly changing environment of the firm have evoked the worry of disruptive change. Many examples have shown the significance of identifying disruptive change: Kodak in the photo industry did not realize the danger of digital cameras and got forced out of their market leadership position, numerous major players in the hard computer disk drive industry are not existent anymore and leaders in the phone industry glimpse their customers fade because of Apple's iPhone . Once the disruptive change has evoked, the loss of successful business activities is usually already in progress. Hence this paper tries to address the topic with an angle of how companies can prevent themselves from disruptive change by evolving the disruptive force themselves (Christensen, 2003).

Discussion

Disruptive change can be characterized as the process over time in which the environment of the firm certainly changes. Disruptive innovation is the factor provoking disruptive change. Disruptive innovation is workout by new competitors inside a market. Disruptive innovation, furthermore called "disruptive technology" or "disruptive strategy", is a process performed that successfully establishes new processes, new technologies and new business models inside an industry or market which leads to the creation of new products or new services. Disruptive innovations fundamentally change the vintage competitive rules, the demands and needs of the existing customers and hence the market structure and segments of existing industries (Invernizzi, 2007).

In terms of innovation and business, this notion sparks the argument that, more than price reductions, it is new ideas that drive entrepreneurial logic and competitive companies. In a society based on knowledge it is vital in research agendas to understand the dynamics and connections between technological innovation and the strong changes in the manufacturing and service industries. In a given innovation context, disruptive technologies press for changes in the way objects are made and sold. They can provide the same services of a prior technology with lower costs and greater applicability, or surpass, in terms of functionality, effectiveness, and economic impact, an entire segment of the market.

Another common hurdle in the face of disruption arrives to light once a company has decided ...