ZAG: The Number-One Strategy of High-Performance Brands

The Focus of Scissors

In the book THE INNOVATOR’S SOLUTION, Clayton Christensen and Michael Raynor divide innovation into two types—“sustaining” innovation, which calls for incremental improvements to existing offerings, and “disruptive” innovation, which attempts to find new market space, often with products or services that are less expensive and initially perceived as “not good enough.” It’s their focus on a disruptive innovation that allows scissors companies to outmaneuver paper companies.

So why don’t paper companies counter-attack with disruptive offerings of their own? Because of “asymmetric motivation.” When a company moves upmarket, much of the incremental revenue falls to the bottom line. When a company moves down-market, little of ...