“Signals of Change” Christensen Munir Mandviwalla Fox School of Business Temple University

Industry Undershot Up-market sustaining innovation. Nonconsumers New-market disruptive innovation Overshot Low end-disruptive innovation Modular displacement Market context Low end, new market, new context Source: Christensen, C., Anthony, S., and Roth, E. “Seeing What’s Next: Using the Theories of Innovation to Predict Industry Change.” Harvard Business School Press, 2006, p.2. Industry

New market Existing market Source: Christensen, C., Anthony, S., and Roth, E. “Seeing What’s Next: Using the Theories of Innovation to Predict Industry Change.” Harvard Business School Press, 2006, p.3.

New market Change Simple Increase access Increase ability Reduce financial barrier Reduce skill barrier Easily Effectively How Convenience Customization Lower price Signals Growth rate Specific segments (college students!) Link out of the chain RELATIVE low price Sustaining Make good products better Incremental More radical Performance Reliability Functionality Consumer frustration Negative reviews Willingness to pay higher prices Prosperity of niche integrators Specialists struggle Integration Need it for radical Compatibility Interoperability Legacy Overshot Decreasing prices over time (refusal to pay for more) Features not used Complaints about things – ‘complicated’ Not all are overshot Ease of use Flexible and convenience Customizability Price Industry change Low-end disruptions (convenience/price) Specialists displace integrated players (at point of modularity) Modularity interface Specify Measure Understood Predict Standards Accepted Hiring does not emphasize deep knowledge Continuum of low-end to new market Value chain Low prices