Summary of Clayton M. Christensen, Jerome H. Grossman & Jason Hwang's The Innovator's Prescription

Insights on Clayton M. Christensen and Jerome H. Grossman & Jason Hwang's The Innovator's Prescription

Contents

Insights from Chapter 1

Insights from Chapter 2

Insights from Chapter 3

Insights from Chapter 4

Insights from Chapter 5

Insights from Chapter 6

Insights from Chapter 7

Insights from Chapter 8

Insights from Chapter 9

Insights from Chapter 10

Insights from Chapter 11

Insights from Chapter 1

#1

The term disruptive technology was first introduced into the lexicon of business management in the 15 years since it was coined. It refers to an innovation that makes things simpler and more affordable, and it is used to describe companies like Intel and Wal-Mart.

#2

In the subsequent five chapters, we will build upon the foundation we laid out in this chapter. Chapter 2 explores the technological enablers of disruption in health care. Chapters 3 and 4 show how the business models of hospitals and physicians' practices must change in order to harness the power of disruption.

#3

The disruptive innovation theory explains the process by which complicated, expensive products and services are transformed into simple, affordable ones. It also explains why it is so difficult for the leading companies or institutions in an industry to succeed at disruption.

#4

A disruptive innovation is not a breakthrough improvement. It is not as good as the products and services sold in the original plane of competition, but it is simpler and more affordable, which allows it to draw customers from that plane of competition.

#5

The only company that was able to successfully sell personal computers was IBM, which for a time became a leader in personal computers by setting up a completely independent business unit in Florida and giving it the freedom to create a unique business model.

#6

Industries that are still extremely complex and expensive to use have not yet been disrupted. This is the case with legal services, higher education, and health care.

#7

A business model is an interdependent system of four components: a value proposition, resources, processes, and a profit formula. The value proposition is the starting point in the creation of any successful business model.

#8

The way in which companies choose to define market segments is a crucial strategic decision, because it influences which products they develop, how they are marketed, and how they are taken to market.

#9

A restaurant chain found that 40 percent of its milkshake sales were made by customers who bought them to do the job of keeping them busy while they drove to work. The milkshake did a better job than any of the competitors.

#10

understanding the jobs that customers are trying to accomplish can help you improve your product. This will help your product stand out from the competition, and grow the market.

#11

The essence of competitive advantage is the ability to integrate your resources, processes, and profit formula in order to do a job that the customer is trying to do. This is why McDonald's can sell a dizzying array of sandwiches, side dishes, salads, drinks, and desserts.

#12

When you help customers do more affordably, conveniently, and effectively, they will pay a premium price and change lots of habits in order to get the job done better and faster. But when your product helps them do a job that they've not been trying to do, selling your product is like an uphill death march through knee-deep mud.

#13

The three levels in the architecture of a job are the job itself, the functional, social, and emotional experiences in purchasing and using the product that are needed to get the job done. Convenience and cost are not jobs, but rather experiences that must be provided to get some, but not all, jobs done well.

#14

The history of innovation is littered with companies that had a disruptive technology within their grasp, but failed to commercialize it successfully because they did not couple it with a disruptive business model.

#15

The only way Nypro could have attacked the growing market for high-variety, low-volume parts was to embed the Novaplast machine within an autonomous business model whose profit formula, processes, and resources were optimized for the disruptive value proposition.

#16

There are three general types of job-focused business models: solution shops, value-adding process businesses, and facilitated networks. These are fundamentally different institutions, in terms of their purpose, where their capabilities reside, and the formulas by which they make money.

#17

Solution shops are institutions that diagnose and recommend solutions to unstructured problems. They are typically fee-for-service institutions, and their clients are willing to pay high prices for their services.

#18