Disruptive Technologies and Shifts in Business Models

Lately I’ve been studying the difference between new business models that improve on the current model of how an Industry does business Vs a business model that is so different compared to what the industry is currently doing, that the existing players are unable to take them on because doing so would admit that the model and strategy that they currently rely to deliver results is no longer relevant. As such by reaching far out past incremental improvements in strategy and model adjustments, an entrepreneur can create an uncontested field where they can thrive in the fledging years. Ofcourse as their success grows others will replicate their models, however the initial period of an uncontested market means margins that allows them grow at supernormal rates.

The below lecture by professor Clayton Christensen (HBS), of the Innovators Dilema fame, gives great insight to competitive markets and strategy when faced with the 3 year mark after the introduction of disruptive business models.

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