Can Technology be Too Disruptive?

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Steve Jobs said, “Innovation distinguishes between a leader and a follower.” The procession of new technologies continues at a breakneck pace, resulting in a world that is more connected than ever. From the Internet, smartphones, hybrid cars, and autonomous vehicles, to 3D printing, energy storage and so much more, innovation disrupts and advances our world.

“But since the Industrial Revolution of the late 18th and early 19th centuries, technology has had a unique role in powering growth and transforming economies,” reports McKinsey Global Institute in a report titled, Disruptive Technologies: Advances that will Transform Life, Business and the Global Economy. “Technology represents new ways of doing things, and, once mastered, creates lasting change, which businesses and cultures do not unlearn. Adopted technology becomes embodied in capital, whether physical or human, and it allows economies to create more value with less input. At the same time, technology often disrupts, supplanting older ways of doing things and rendering old skills and organizational approaches irrelevant.”

Recent history is full of major companies and sectors that were met and leveled by disruptive technology. Just a few examples include the video rental business usurped by digital streaming, the traditional print publishing world disrupted by online publishing and the conventional power industry challenged by the rapid growth of the solar and energy storage sector. But when is new technology too disruptive? Does new technology ever debut before its time? In the book, “The Innovator’s Dilemma: When New Technologies Cause Great Firms to Fail,” by Clayton M. Christensen, the author writes that “outstanding companies can do everything right and still lose their market leadership— or worse, disappear altogether.” Focusing on “disruptive technology,” Christensen’s book is about the “failure of companies to stay atop their industries when they confront certain types of market and technological change” and why many companies miss out on new waves of innovation. Whether in electronics or retailing, a successful company with established products will get pushed aside unless managers know when to abandon traditional business practices.

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Editor’s Note: This article originally appeared in the November 2015 issue of The PCB Magazine.