Innovation Killers

How Financial Tools Destroy Your Capacity to Do New Things. by Clayton M. Christensen, Stephen P. Kaufman, and Willy C. Shih

FOR YEARS WE’VE BEEN puzzling about why so many smart, hardworking managers in well-run companies find it impossible to innovate successfully. Our investigations have uncovered a number of culprits, which we’ve discussed in earlier books and articles. These include paying too much attention to the company’s most profitable customers (thereby leaving less-demanding customers at risk) and creating new products that don’t help customers do the jobs they want to do. Now we’d like to name the misguided application of three financial-analysis tools as an accomplice in the conspiracy against successful innovation. ...

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