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Recommended Readings: Business Strategy

 

Disruptive Technologies: Catching the Wave by Joseph L. Bower and Clayton M. Christensen

 

Many leading companies lose their market leadership when technologies or markets change. Why is it that established companies invest aggressively- and successfully- in the technologies necessary to retain their current customers but then fail to make the technological investments that customers of the future will demand?

 

Most established companies are consistently ahead of their industries in developing and commercializing new technologies as long as those technologies address the next-generation-performance needs of their customers. However, an industry's leaders are rarely in the forefront of commercializing new technologies that do not initially meet the functional demands of mainstream customers and appeal only to small or emerging markets.

 

To remain at the top of their industries, managers must first be able to spot the technologies that fall into this category. Managers must protect them from the processes and incentives that are geared to serving mainstream customers. And the only way to do that is to create organizations that are completely independent of the mainstream business.