The term “disruptive innovation” sounds recent, but it’s actually been around since 1995.
That’s when Joseph L. Bower and Clayton Christensen coined the term in the pages of the Harvard Business Review.
The term refers to an innovation that makes a huge change in the industry. It connects ideas that haven’t been connected before to tap into a completely new market.
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Even more specifically, the Harvard Business Review defines disruption as “a process whereby a smaller company with fewer resources is able to successfully challenge established incumbent businesses.”
It’s the David versus Goliath story applied to entrepreneurs. When a small startup beats out industry giants, that’s disruption.
Disruptive innovation is like coloring outside the lines. It doesn’t follow any set of rules, but it still creates something amazing.
Airbnb is a perfect example.
It was a tiny startup that took on the entire hotel industry and it worked.
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Airbnb is probably the best example of true disruption.
Think about it: A startup founded in 2008 is making more than global hotel chains that have been around for decades.
That’s the power of disruptive innovation.
More startups are getting comfortable with the idea of being disruptive. It’s riskier, but the rewards are also bigger.
At its core, a major aspect of disruption is connecting customers to more resources. Think of it like taking out the middleman. Often, this cuts costs and makes users happier.
Think of this as disruptive technology.
In the last couple of years, we’ve seen lots of businesses use disruptive technology to create something new.
Businesses like Netflix, 23andMe, and Spotify have used disruptive technology to rise to the top. In fact, most of the companies you support today are likely disruptive in one way or another.
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And that trend of disruptive technology is only going to get bigger.
Airbnb connects you directly to lodging and you don’t have to go through a hotel. Amazon gives you access to almost any product you want and you don’t have to leave your home.
Many of the biggest startups of 2017 are doing just that. While they’re not necessarily disrupting entire industries, they are using disruptive technology to create new and exciting businesses.
Take a look at Virta Health, which connects diabetes patients directly with doctors via video chat.
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That’s disruptive technology in action.
Another example: Roadrunner Recycling helps people recycle more with scheduled pickups and various waste management solutions.
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There are all kinds of disruptive technologies out there.
Even the classic freemium business model can be turned into disruptive technology that allows you to become more popular than your competitors.