Clay Christensen - Innovator's Dilemma

**Mike Parsons** (0:10)
Hello, and welcome to the Moonshots Podcast. It's episode 39
I'm your co-host, Mike Parsons. And as always, I'm joined by Mr. Chad Owen.
Good morning, Brooklyn.

**Chad Owen** (0:22)
Good evening, Sidney. How are you, Mike?

**Mike Parsons** (0:25)
I'm very good. I'm full of beans, but you officially should be full of beans because you've had your morning coffee and you're ready to go.

**Chad Owen** (0:31)
Well, no coffee just yet, but no, it's been a good morning so far.

**Mike Parsons** (0:36)
Oh my gosh, how do you do that? I mean, it's literally my first thought. I just kind of stumbled to the coffee machine, but-

**Chad Owen** (0:44)
Cold showers, cold showers.

**Mike Parsons** (0:47)
You stoic lot.
I can't give up, but I tell you what else will wake you up is some good innovation thinking and a brand new Moonshots series, Chad. What do we got going on?

**Chad Owen** (0:59)
Yeah, so we're not only reaching into the world of innovation, entrepreneurship authors, but we're actually taking a jaunt to New England, to Harvard Yard, as they say. Yeah, straight into academia and learning from none other than Clayton Christiansen.

**Mike Parsons** (1:22)
And it should be said this guy is right up there as far as innovation authors. In fact, just in general, like as a business guy, this guy is rocking the house.
He's written a number of landmark books when it comes to business and innovation. He's often regarded as like the father of disruptive innovation. He was polled as the number one most influential business thinker in the world in 2011 He's written a number of bestselling books across a really broad spectrum.
He's one of the most robust thinkers I think we've ever had on the show. What do you think, Chad?

**Chad Owen** (2:07)
Yeah. I definitely felt like I was going back to school, listening to a lot of his explanations of the theory of disruption and innovation. I think it's a fantastic friend. I'm really disappointed we didn't do him earlier because he gives all of us a really fascinating framework in a shared language around how to talk about different kinds of innovation, what they look like, and really trying to decide, is this company truly disruptive or not, or is this technology truly disruptive or not?
I'm glad we're getting to him now.

**Mike Parsons** (2:49)
I think what's in this for all of our audience is this, he is one of the most essential thinkers that you should understand because you can apply it to your startup, to your large organization.
What he has essentially done is decoded what it takes, what it looks like to be 10 times better than what's on offer today. He's really established, regardless of which side of the equation you're on, what disruption looks like, whether you're the incumbent, large organization, or whether you're the new entrant, the challenger brand, who's coming in to disrupt an existing market. So it really doesn't matter which side of the equation you're on, we have ideas and thoughts. I have plenty for you in this show and a quick reminder, where should everybody go if they want to dig up show notes and extra ideas and inspiration, Chad?

**Chad Owen** (3:42)
All of that can be found at moonshots.io. You'll see all of our future episodes, future authors that we're going to be speaking about, Simon Sinek, your super favorite, Mike, but also Peter Drucker, a predecessor of Clay's.

**Mike Parsons** (4:00)
Most definitely.

**Chad Owen** (4:02)
And Eric Ries. And Eric Ries and even many more.
But you can find all that information in previous episodes at moonshots.io. And one other thing that we're bringing back this time, we've got a book review.
Of Clay's first book that he wrote, The Innovator's Dilemma. And it's a great book that I think everyone should pick up and read. You could finish it in a weekend. But yeah, we'll be diving into that book a little bit later in the show.

**Mike Parsons** (4:37)
Nice.
So where should we start all of this talk of disruption? Where does one begin, Chad?

**Chad Owen** (4:44)
Well, you were able to find a really interesting kind of summary of the core idea inside of the innovators dilemma and kind of an explainer, if you will, of Clay's kind of general theory of disruptive innovation. So I think we'll just start right there.

**SPEAKER_1** (5:02)
How does a small young company beat an industry giant on its own turf? Through what Harvard Business School professor Clayton Christiansen calls disruptive innovation. It works like this. Big players focus on sustaining innovation, upgrading existing products and services to attract higher-paying customers. But soon, they start to ignore all the regular customers who just want simple, low-cost alternatives. That's where the entrepreneurial company jumps in with that basic offering. The big guys stay focused on more profitable customers and begin to over-serve, adding bells and whistles no one wants to pay for. Meanwhile, the disruptor improves its product to appeal to more people. By the time the incumbent notices, the disruptor has already started to take over the market. The classic example is the steel mini-mills, which first produced low-quality rebar, then moved to sheet steel, stealing business from the large mills that had been dominant.