What is Disruptive Technology and How Do You Know It When You See It?



10 Feb 2016


11 minute read

That’s a really good question.


But apart from sounding like some sort of Netflix original series, Disruptive Technology isn’t anything new.  The term may only have been coined in 1997, but disruptive technology has been around since before humanity started banging rocks together to make fire, and that’s quite a long time.

The concept of just what constitutes a disruptive technology is actually very easy to understand.

Disruptive technology is simply a new or emergent technology that displaces an established technology, and changes the way we do things.

The 20th Century

For instance, sharing a photograph with someone 20 years ago meant taking a picture on a camera, taking the film to a shop to get it processed, waiting 2 days for the shop to develop it, picking the photos up from the shop, and then sending them via an envelope via the postal service.  This was also a relatively expensive process as you had to hand over money at every stage of the process.

Only a decade ago, all we had to do to share a picture was to download our photos to our beige PCs and attach them to an email. Today all we do is press the share button on our phones; and that’s it.

This is a prime example of how digital technology disrupted an established technology, displaced an entire industry, and at the same time helped create a completely new industry.

Clayton M. Christensen, The Professor Who Named It

Clayton M Christensen put the name to Disruptive Technology in his bestselling book back in 1997, called “The Innovator’s Dilemma.” Christensen argued that there were primarily two main categories of new technologies that matter: Sustaining, and Disruptive.

Christensen argued that Sustaining Technologies are technologies that improve upon existing products already in existence. Most large companies in the world are masters at turning sustainable technology to make money, carve out a large market share, and if they prove to be successful over a long period of time, dominate their respective industry.

Ironically however it tends to be the larger giants of industry that struggle to adapt when some new disruptive innovation comes along.  Historically, this has caused the failure of some high profile and highly successful companies that were not prepared to have their way of doing things altered.

It’s Only Disruptive in Hindsight

One of the major issues with disruptive technology is that when a new disruptive technology comes along, it’s not always all that obvious that its arrived. Disruptive technology can, by its very definition, be a risky business.

The dilemma is the fact in the beginning all disruptive innovations are an unknown quantity. They are unproven, and no one knows if they will work. Netflix for instance initially built their business model on sending rental DVDs by post. This in itself was a disruptive innovation.  Netflix didn’t go after Blockbuster customers. Instead it chose to go after smaller core groups, such as the early adopters of DVD players. Then Netflix moved upmarket, capitalising on the advantages it already had, and by outsmarting its competitors who initially didn’t see the threat, by offering movies on demand over the internet.

It’s hard to think now, only a few years later, that the idea of streaming movies through the internet on demand is pretty standard weeknight viewing, and has passed into the everyday vernacular.  Even less unlikely would be the appearance of the phrase, “you want to Netflix and chill?” 

The Slow Rise of the Deceptive Disruptive Influence

Netflix didn’t become disruptive overnight.  Disruptive technology doesn’t just happen. It evolves.

This is also one of the major problems with truly disruptive technology; it doesn’t hit the market with an explosion. Instead it can often be the case that it arrives prematurely, and not ready for the market. A perfect example of this is Google and NASA’s joint effort to build the world’s first fully functional and viable quantum computer.

Well, they built it, it works, but while still smaller than a traditional super computer, it’s still the size of a large shed, and there’s currently no market or practical use for such a machine.  Hartmut Nevin, the boffin in charge of Google’s effort has readily admitted that he doesn’t even know what a commercially viable quantum computer could actually be used for. But then, it’s also alleged that Thomas Watson, CEO of IBM said in 1943,"I think there is a world market for maybe five computers."

And that’s the thing about disruptive technology: When it first arrives on the scene, it’s often rough round the edges, unfinished, doesn’t work properly, and a lot of people don’t see the potential, until it’s too late.  The rise of online travel booking on the web, for example, almost destroyed the brick-and-mortar shop based travel agency industry.

Failure to Capitalise

There is literally no way to reliably predict what new technologies will or won’t break the mould. Technology on its own is not enough to upset the apple cart. For disruptive technology to perform a paradigm shift in the world, other economic and social drivers have to be taken into account.

There are many grave markers you can look at when you consider the influence of disruptive innovation.  Some industries fail to see the technological leap when it happens, and others fail to capitalise on it.  Kodak for instance invented the digital camera back in 1975, but let others steamroller them into the ground with it because they didn’t want to hurt their core film processing business.  Kodak filed for bankruptcy in 2012.  The Xerox company invented the humble computer mouse, but it was Apple  that turned it into a technology that changed the way we use computers, because Steve Jobs saw what Xerox could not; a device that proved to be turning point in PC history.

Not All Technology is Disruptive

This is true. The term “disruptive” is one of those big buzz words out there at the moment. But there needs to be a distinction drawn between what is truly disruptive, and that which is just new.  Steam Engines, Nuclear fission, the internet; these are all things that truly changed the world.

So is the example of Netflix, that was used above really a disruptive innovation? Disruption is supposed to be ground-breaking in its remit, something that knocks tradition for six, and changes the way people think and do things.  So is Netflix disruptive, or merely innovative. Is it possible for example that the real disruption in this case came from the mass adoption of high speed internet, which itself is fuelled by the rise of the World Wide Web?

So, in closing, Disruptive Technology, or Disruptive Innovation as it also known, has been around for a long time. It can arrive and not be noticed until it has already disrupted the current sustaining technology, and the revolution is well under way.  But for every successful disruptive achievement there are hundreds more that don’t make it.

Take a look at Chrysler’s 1962 turbine (Jet) powered production car from 1962 if you don’t believe me. Then there’s also the fact that not everyone will capitalise on disruptive technology when it does appear, even when, like Kodak and Xerox, they invent something that went on to change the way the entire world does things.  But most importantly, the thing to remember is that that disruptive technology is almost never the finished article when it does arrive on the scene. The first wheelbarrow had a square wheel. The first steam engine hardly enough power to pull itself, let alone freight. The first boats with sails could not be steered, and the world’s first web page looked terrible.  But all these things in their own way changed the world, it’s just that no one probably realised that at the time.

If you came across some new disruptive technology today, would you know?

By Euan Viveash (Writer, Geek, Nerd, Lover, Scottish. Only 4 of those things are true. But, those 4 do pretty much describe this handsome geek writer from Scotland completely. With a background in IT, technical writing, and video games, Euan has been writing about software and the latest technology in general for the best part of 10 years. In any case, he’s fairly certain it beats actually having to work for a living. He also wrote this himself. Can you tell?)

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