On Jan 3, 2010, at 9:26 AM, mark schraad wrote:
Analysis of history (such as Norman's essay) tells what approach has
been used most frequently, but it fails to answer the implied
question of 'what is the best approach?' Everett Rogers (diffusion
of innovation) provides significantly more insight into what makes
products successful. In an earlier writing Don got it right... it is
form, function and fit. Technology... a business initiative... user
needs, they all led to potentially successful products. MBA's and
Engineers have been running businesses for the last 100 years. It is
no real surprise that their domains have lead these product efforts.
The interesting thing about analysis is what is left out as much as
what is included.
There have been many instances of technologies that haven't
revolutionized the world or even been interesting to the customers it
was intended for. Some technologies (like the Apple Newton) were
important from an evolutionary standpoint while being a practical
marketplace failure.
Great experiences come after we've mastered the technology. You can't
even begin to talk about experience until you've done that. If you
look at the DVR as a game changing radical experience, you couldn't
talk about it without talking about the VCR first. But the VCR was an
experience disaster, albeit popular in the marketplace, because the
market was satisfied by the technology alone.
The demand of great experiences only comes from the frustration left
behind by a better understanding of the experience because of the
rough edges of the technology.
As for disruption... I might suggest looking at Christensen's
definition. It has more to do with taking advantage of established
companies tendencies towards arrogance and complacency (my
interpretation). Rooted in efforts to "maximize" profit in the short
term... that arrogance typically leads to overestimating the profit
a company can extract from the next transaction.
It's interesting you bring that up. I was just listening to Prof.
Christensen talking about just that:
Reinventing Your Business Model | HBR IdeaCast
http://blogs.bnet.com/intercom/?p=1937
For big, established firms, introducing a new business model is no
easy task, especially when there’s some start-up poised to steal
business the minute the competitive landscape changes. But according
to disruptive innovation expert Clay Christensen, if companies truly
understand how their new business model relates to the old one, a
profitable transition is possible. Christensen points to IBM, which
switched profitably from the mainframe market to the PC market, for
proof that it can be done right.
See this article too: http://bit.ly/5B6dyn
Basically, his thesis is that it isn't arrogance that prevents moving
to the newer disruptive business model. It's an investment in marginal
profits.
In the podcast, he blames business school professors, including
himself, for focusing MBAs on ignoring sunk costs and focusing on
marginal profits. He says that when you compare pure financial ROIs,
the existing business model will always look better than new
disruptive business models, since the new model has higher up front
costs. That's why, he claims, it's really hard to switch.
If you find this subject interesting, I highly recommend you read the
article and listen to the podcast.
Jared
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