This book is about the failure of companies to stay atop their industries when the confront certain tyupes of market and technological change. It's not about the failure of simply any company, but of good companies -- the kinds that many managers have admired and tried to emulate, the companies known for their abilities to innovate and execute....It is about well-manged companies that have their competitive antennae up, listen astutely to their customers, invest aggressively in new technologies, and yet still lose market dominance. (p. xi)
Clayton M. Christensen's The Innovator's Dilemma isn't even a book about libraries, science or even social media. It's not directly about the future of libraries, the future of science or the future of media. In fact, it's not about any of the things I usually write book reviews on. So why did I read it and why am I reviewing it here?
Simple -- it's a book about dealing with change on an organizational level. Adapting, evolving, anticipating, reacting; good strategies, bad strategies. It's about staying ahead of the technological curve, it's about doing what your customers really need, rather than what they think they need.
In other words, it's about the future. Oh yeah, I guess it is a topic I'm interested in.
First the short version: Read this book. I don't care what industry you work in or what your job is, in 2010 and beyond, how you and your organization react to technological change and channel that change into innovative products and services is vital to your survival. Libraries, newspapers, universities, everybody.
What I liked most about Christensen's book is that it made me think. Every chapter has at least a few good ideas or even a case study. While some of the book may be too business/industry-oriented to be completely relevant to an academic library context, most of it worked quite well, sometimes with a bit of a stretch. Also, I found the book to be largely free of the hype and pointless repetition that so often plagues business books. It comes in at a fairly densely packed 270 pages of text so it's neither too long to absorb nor too short to meaningfully grapple with important issues.
Enough preliminaries, let's get to what the book is actually about.
First of all, the core idea is that there are actually two kinds of technological innovations that affect organizations -- sustaining and disruptive.
Sustaining technological innovation is related to improving a particular product or service. Disruptive technological change causes a more fundamental change in the product or service, often opening up completely new markets for a product line or creating whole new applications. Disruptive technologies can temporarily leap ahead of what customers actually want, so initial investments in them will be problematic. Find a way to identify and stick with these disruptive technologies will pay dividends in the longer term. (p. xviii)
I think it's safe to say that libraries are facing disruptive change on many fronts and this book provides food for thought and strategies for coming to grips and exploiting those changes.
It's a fairly dense book, so I'll hit the high points of some of the things that really struck me:
- One interesting concept is that organizations can be held captive by their best customers. By focusing on exploiting and serving those customers, organizations can miss opportunities to jump into the next big thing. The customer is not always right -- the trick is to know when to stick close to their needs and when to jump ahead of them. (p. 3-4, 19)
- Successful organizations operate within "value networks" -- the larger market context within which they operate and use their internal resources to provide value to their customers. It's often new entrants to a market that are best able to transform those value networks with disruptive technologies. (p. 36, 61-63.)
- Managers have the most incentive to back projects within the existing value network. Sound, tactical managerial decisions can be at the root of failure. (p. 94-5, 108)
- "Good management" often leads to the rejections of disruptive technology. (p. 112)
- Established organizations can take advantage of disruptive technologies, but initially the cost structures and revenue streams mean it'll be best to spin off those units into independent organizations. (p. 127, 132)
- You have to match the size of the organization to the size of the market. Leadership in disruptive technologies is what creates value & opportunities. (p. 138, 142, 158)
- "Markets that do not exist cannot be analysed." In other words, the potential for disruptive technologies cannot be evaluated and assessed in the same way as for sustaining technologies in already established markets. (p. 165)
- Exploiting potentially disruptive technologies is more likely to lead to failure and miscalculation than sustaining technologies. It is usually necessary to act before careful plans are made to be able to seize the opportunity. There is a huge first-mover advantage. (p. 180, 182)
- The "killer app" of a disruptive technologies is not always immediately obvious -- either to the organization developing or to the early adopter customers who start using it. (p. 182)
- Disruptive technologies don't come along often enough for organizations to have defined ways of dealing with them. (p. 191)
- Internal processes that favour sustaining technologies are hard to change, both because the organization is structured to favour the existing and because there will be resistance to changing what is perceived as not being broken. (p. 201)
- Taking advantage of a disruptive technology isn't so much about the technology itself as how the market for it is developed, built and exploited. It's about where the customers' needs intersect what the technology can do. (p. 220-21, 230)
- The big question is, of course, how do you tell if a technology is disruptive rather than just interesting but not very useful? First, it can be useful to watch how customers actually use a product rather than how they say they might use it or rely on how you think they should use it. You also need to judge whether or not the product will one day move from a niche market to a mass market. This often means finding the market where the product really belongs, learning from how the customers use the product. (p. 236-42)
Christensen also provides a handy seven point summary of the book in Chapter 11 (p. 258-261):
- The pace of progress that markets demand or can absorb may be different from the progress offered by technology...
- Managing innovation mirrors the resource allocation process: Innovation proposals that get the funding and manpower they require may succeed; those given lower priority...will starve for lack of resources and have little chance of success...
- Just as there is a resource allocation side to every innovation problem, matching the market to the technology is another...
- The capabilities of most are far more specialized and context specific than most managers are inclined to believe...
- In many instances, the information required to make large and decisive investments in the face of disruptive technology simply does not exist...
- It is not wise to adopt a blanket technology strategy to be always a leader or always a follower....
- There are powerful barriers to entry and mobility that differ significantly from the types defined and historically focused on by economists...because disruptive technologies rarely make sense during the years when investing in them is most important, conventional managerial wisdom...constitutes and entry and mobility barrier...
Sorry for going on so long, but I found this book to be pretty good at encapsulating the kind of thinking that I need to do for the My Job in 10 Years book project and it's helped me to get a lot of Christensen's main points down here.
I would recommend this book without hesitation to all librarians and information professionals. Collection-wise, this would fit in any business, technology or information profession collection -- anywhere where the patron community is dealing with rapid technological change.
Christensen, Clayton M. The innovator's dilemma: The revolutionary book that will change the way you do business. New York: Collins Business Essentials, 2006. 286pp.