Disruptiv and Value Innovation

Topics: Innovation, Disruptive technology, Good Pages: 6 (1943 words) Published: July 31, 2013

Many companies allow their competitors to set guidelines of their strategic thinking. They compare their strengths and weaknesses with strengths and weaknesses of their competitors. After, they begin to focus on building products that are better than the original products. This type of thinking opens the door for disruptive innovation. Disruptive innovation has proven time after time to have an advantage in developing creatively through the theories of innovation. Disruptive innovation created an advantage over the competition when a plan was developed correctly. Companies are developed with the goal of success in mind. In order to do so, these same companies must be willing to adhere to its main focus and not focus on its competitors. “One of the most striking findings of our research is that despite the profound impact of a company’s strategic logic, that logic is often not articulated. And because it goes unstated and unexamined, a company does not necessarily apply a consistent strategic logic across its businesses” (Kim & Mauborgne, 2004). Companies often lose focus of their overall goal causing failure. In today’s times, companies need to develop a strategy that keeps focus on themselves and not the competitor. Due to shared innovation, disruptive innovation has opened many doors of many different areas of strategic thinking.

Another area of strategic thinking is value innovation. Value innovation dwells on the importance of worth. Value innovation has been demonstrated in “Blue Ocean Strategy: From Theory to Practice” (W. and Mauborgne, 2005). Value innovation focuses strictly on finding the wants and needs of its customers and improving the market they have instead of the competitors and what they are presently doing, what will be done in the future, or what they have done. In order to complete this method of innovation, a company must be knowledgeable of their customers. A customer only buys what is needed and the company will need to ensure that what the customer needs is what that company produces. A company that demonstrates this theory is Proctor and Gamble.

Disruptive Innovation

Disruptive innovation is one of the most important innovation theories. The main purpose of disruptive innovation is to take a service or product and progress into different way that the market it not expecting. Through disruptive innovation, the created new product that is within its market will eventually replace the original product. Disruptive innovations aim to capture large shares the well-known market. This theory was originally introduced by Clayton Christensen in his book titled “The Innovator’s Dilemma” (Christensen, 1997). In this book, Christensen described disruptive innovation as an innovation that is created to help the current market but eventually proceeds to disrupting the existing market of what was previously developed (Christensen, 1997).

Value Innovation

Another form of this type of strategic innovation is value innovation. Value innovation targets a large amount of shareholders with the understanding that they may lose some of their customers. They then turn to the focus of key commodities and solutions that goes beyond their traditional offerings. (Kim and Mauborgne, 2004). Value innovation is simply defined as the immediate search of greater value for its customers while obtaining a lower costs for the company. Value innovation allows companies to search for ways of making their competitor a non-factor. (Kim and Mauborgne, 2004).

To do this, the companies will need to create a jump in the worthiness for the customer and the companies by opening a totally new market and also by creating the same jump in value for the buyers and also for the companies through opening up a new and unbiased market. For this same reason, the customer’s worth derives from the contributions subtracted by its price, the definite assessment of the...

References: Christensen, C. M., & Overdorf, M. (1997). Meeting the Challenge of Disruptive Change.
Harris, D. (2008). Creating value through innovation. Community Banker, 10-10. Retrieved July
16, 2013 from: http://search.proquest.com.library.capella.edu/docview/195163429?accountid=27965
Kim, W., & Mauborgne, R. (2004). Value Innovation: The Strategic Logic of High Growth.
Proctor and Gamble Company. (2012). Proctor and Gamble Annual Report. Retrieved from
W. Chan, K., & Mauborgne, R. (2005). Blue Ocean Strategy. Retrieved from:
Witchalls, C. (2007). Case Study: Proctor and Gamble. Computers & Applied Science Complete.
Retrieved July 17, 2013 from Ebscohost
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