Fundamentals of Level Three Leadership

56. The Innovator’s Dilemma

Concept

Clayton Christensen at the Harvard Business School (a former colleague and basketball junkie friend) identified a new idea, something every academic hopes to do. Clayton in his book, The Innovator’s Dilemma: When New Technologies Cause Great Firms to Fail, focused on the percent utilization of product features.²¹ Clayton’s idea in sum was this: In order to add revenues, firms will naturally add features to their products and therefore gradually raise the prices of their products. Ultimately, they are vulnerable to attack by cheaper, less sophisticated new entrants. Thus, the percent utilization of this annual wave of new features defines opportunities for competitors—where there are lower percent utilizations. ...