Incumbent organizations tend to value sustaining innovations
When leadership of an incumbent organization observes that Disruptive innovations underperform at the outset, they tend to prioritize sustaining innovations.
In established firms, expected rewards, in their turn, drive the allocation of resources toward sustaining innovations and away from disruptive ones. This pattern of resource allocation accounts for established firms’ consistent leadership in the former and their dismal performance in the latter.[1]
This is especially true for larger organizations, as Emerging markets are decreasingly attractive as organizations get larger.
See also:
- Efficiency is purchased by a loss in flexibility
- Disruptive innovations fail because they do not provide immediate financial value
The Innovator’s Dilemma – Christensen (1997), ch. 2, 33. ↩︎