Question

Disruptive technologies offer a new way of doing things that initially does not meet the needs of existing customers. Disruptive technologies redefine the competitive playing fields of their respective markets, open new markets and destroy old ones. this week is to talk about a disruptive technology that offered a new way of doing something and the market that it destroyed.

Answer 1

Background Information

One of the master keys to any successful business is introducing and implementing new ideas to keep products, services and operations fresh and alive. The entire mechanism of bringing those ideas to reality is called innovation/new technology.

However disruptive innovation/technology is one step ahead of innovation. It replaces the present technology and destroys the well-established market based on present technology.The concept of disruptive innovation/technology was coined by professor and entrepreneur "Clay Christensen" in the year 1995.

Technology is never constant. Just like living organisms, technology starts, develops, persists, mutates, stagnates, declines and is finally replaced by new technology.

What is disruptive technology?
Disruptive innovation/technology occurs when new products, services or operations are invented at the bottom of the marketplace but end up by virtually displacing their competitors. According to Christensen, it is an innovation that transforms and revolutionizes an existing market or sector by introducing and implementing simplicity, convenience, affordability and finally accessibility,

In the beginning, a disruptive innovation/technology finds a place in a niche market that may be apparently unattractive or inconsequential to industry incumbents, but eventually disrupts an existing market, displacing established market leading firms' products, services and operations.the new mechanism or idea completely redefines the industry.
Recall how great innovations/technological changes were disruptive. Computer disrupted typewriter, Email disrupted the postal service, car disrupted horse breeders and hundreds of similar instances can be revealed.

Here are latest examples of disruptive innovation/technology that destroyed the well-established marked (based on old technology) and revolutionized the entire mechanism of doing business.

1. One of the best examples of how the Internet can devalue business models is Craigslist (American classified advertisements website ) and its effect on the classified ads business.

In the year 200 classified advertisement was nearly $19.5 billion business. In 2008 it had fallen to $9.9 billion because of online classified ads posted by Craigslist.

2. The slow death of the era of printed book has revolutionised the way people read and learn. In the first instance, big chain stores like Barnes & Noble wiped out the independent corner bookshop. Thereafter, megastores face the crisis with the arrival of e-books. There is a tectonic shift in sale of e-books that is expected to hit $2 billion next year. Amazon has launched e-readers like the Kindle. Consequently, Borders was recently declared bankrupt. Moreover, Barnes & Noble, despite market leadership in the past is losing money too.

Other Examples of Disruptive technology

1. In the past, Farmers used to hold 50% of the U.S. workforce. Till date, less than 2.5% are employed in this sector. However, volume of food that is being produced has increased due to the automation in the industry of agriculture and food production.

2. Tax software such as TurboTax has made tens of thousands of tax accountants jobless.

3. Online Travel websites such as Kayak, and Travelocity have eliminated human travel agents.

4. Newspapers Circulation has been declined to a great extent and replaced by online media and blogs. Few specific computer software are actually writing news stories.

5. Receptionist and phone operators have been replaced automated telephone systems, and mobile apps.