Disruptive innovation

Disruptive innovation, sometimes called disruptive technology is the name for a technology or innovation that changes the market: It creates a new market. These new markets are small at first, which makes them uninteresting for established market players. If disruptive innovation is used, the market will grow at a high speed. Eventually, they will replace existing technology, though. An example of this is Flash memory.  When it was introduced it was expensive, and capacities were small, compared to hard disks. On the other hand, flash memory is small, and uses little energy. It began to be used in mp3 players and usb flash drives. Eventually, it was used for Solid state disks, which started to replace hard drives.

Clayton M. Christensen first used the term in 1995: Christensen defines a disruptive innovation as a product or service designed for a new set of customers.
"Generally, disruptive innovations were technologically straightforward, consisting of off-the-shelf components put together in a product architecture that was often simpler than [previous] approaches. They offered less of what customers in established markets wanted and so could rarely be initially employed there. They offered a different package of attributes valued only in emerging markets remote from, and unimportant to, the mainstream."

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Category:Economics