Disruptive Technologies - Part 1: How music editors are related
to steam engines
I am not into technologies, those that change so ever fast, and
always. But I do observe technological trends, along which the
development of scientific applications revolves.
And of all trends, perhaps disruptive technologies are
the defining path of industrial implications, a linear passage
that technological progress almost invariably follows. Though
the concept of "disruptive technologies" is only
popularized in 1997 by Harvard Business School Professor Clayton
Christensen in his best-seller "The Innovator's Dilemma", the
phenomenon was already evidenced back in 1663, when Edward
Somerset published designs for, and might have installed, a
steam engine.
As put forth by Clayton Christensen, disruptive
technologies are initially low performers of poor profit
margins, targeting only a minute sector of the market. However,
they often develop faster than industry incumbents and
eventually outpace the giants to capture significant market
shares as their technologies, cheaper and more efficient, could
better meet prevailing consumers' demands.
In this case, the steam engines effectively displaced horse
power. The demand for steam engines was not initially high, due
to the then unfamiliarity to the invention, and the ease of
usage and availability of horses. However, as soon as economic
activities intensified, and societies prospered, a niche market
for steam engines quickly developed as people wanted modernity
and faster transportation.
One epitome of modern disruptive technologies is Napster,
a free and easy music sharing program that allows users to
distribute any piece of recording online. The disruptee
here is conventional music producers. Napster relevantly
identified the "non-market", the few who wanted to share their
own music recordings for little commercial purpose, and thus
provided them with what they most wanted. Napster soon blossomed
and even transformed the way the internet was utilized.
Nevertheless, there are more concerns in the attempt to define
disruptive technologies than simply the definition itself.
One most commonly mistaken feature for disruptive
technologies is sustaining technologies. While the former
brings new technological innovation, the latter refers to
"successive incremental improvements to performance"
incorporated into existing products of market incumbents.
Sustaining technologies could be radical, too; the new
improvements could herald the demise of current states of
production, like how music editor softwares convenience Napster
users in music customization and sharing, thereby trumping over
traditional whole-file transfers. The music editors are part of
a sustaining technological to Napster, not a new disruptor.
Thus, disruptive and sustaining technologies could
thrive together, until the next wave of disruption comes.
See how music editors are linked to steam engines? Not too
close, but each represents one aspect of the twin engines that
drive progressive technologies; disruptors breed sustainers, and
sustainers feed disruptors.
This character of sustaining technologies brings us to another
perspective of disruptive technologies: they not only
change the way people do business, but also initiate a fresh
wave of follow-up technologies that propel the disruptive
technology to success. Sometimes, sustaining technologies
manage to carve out a niche market for its own even when the
disruptive initiator has already shut down. Music editor
and maker softwares continue to healthily thrive, despite
Napster's breakdown (though many other file sharing services are
functioning by that time), with products like the AV Music
Morpher Gold and Sound Forge 8.
A disruptive technology is also different from a paradigm
shift, which Thomas Kuhn used to describe "the process and
result of a change in basic assumptions within the ruling theory
of science". In disruptive technologies, there are no
assumptions, but only the rules of game of which the change is
brought about by the behaviors of market incumbents and new
entrants. They augment different markets that eventually merge.
In Clayton Christensen's words, newcomers to the industry almost
invariably "crush the incumbents".
While researching on disruptive technologies, I came
across this one simple line that could adequately capture what
these technologies are about, "A technology that no one in
business wants but that goes on to be a trillion-dollar
industry." Interesting how a brand new technology that seemingly
bears little value could shake up an entire industry, isn't it?
You are probably asking, why then that no one wants it? Or how
true is the money claim to these disruptive technologies?
And if it is true, what are the implications to the business
practice? How do market incumbents and new entrants behave?
The scope of this article could only let me take the first
question. Well, it is not that dominating companies are not
visionary to see a disruption is coming. They can't. A
disruptive technology is inherently not attractive
initially; no one could see how Napster could boom and lead to
the thriving market of audio softwares like the music editors
and mixers, except the disruptors themselves. Even if one
manages to foresee it, the "Innovator's Dilemma" is there to
keep them from acting.
And as the books show, technology has always evolved in waves of
disruption.