Book Review: The Innovator's Dilemma

Before I know it, a year has passed. Another New Year's Eve is here. Having been named as Steve Job's "deeply influencing" book, I hope to learn a thing or two about the technology trends. To my surprise (and a bit of disappointment), the book doesn't discuss much perspectives from creators or innovators but is mostly tailored to managers in practice, especially those at well-established, outstanding companies. Don't be afraid to skim sections once you get the points. Read the last two chapters of the book for a sketch of ideas. Below are my takeaways:

Summary

Industries leaders failed in establishing themselves when disruptive technologies emerged and dominated the market. The downfalls come from what most managers are trained to "listen to their customers" and their unwillingness to invest in the less profitable markets. By nature, disruptive technologies begin with lower performance, but lower margin relative to sustaining technologies. As more time and effort is spent, disruptive technologies soon are able to meet the market demand and supplant existing technologies. The author offers several strategies, including acquiring or designating  an independent entity suited for smaller markets, to embrace disruptions and possibly survive the next waves of emerging technologies.   

Two takeaways from the book:

• If you are a manager at a large successful firm: Do not listen to your customers when it comes to innovation. Your organization's processes and values will dictate if they (you) will rise or fall. Because large companies position themselves in the upmarket, they divest away from the low-margin disruptive technology, which (possibly) eventually supplants sustaining technology  --- an innovator's dilemma. One way to solve this is to acquire emerging firms suited for smaller markets..
• If you work for a startup: Find a niche market for your product. Sell your product first, then engineer it later. Be ready to get acquired if you do well, or lose your job if the opposite.

Who should read the book:

Anyone with a business bent of mind and managers in the mid- or late-career at larger and successful firms.