Chapter: 2- Literature Review

Innovation is theintegral part of a company’s success in the market and its sustainability in the long term(Ministers, 2010). According to (Hamel G. , 2000), innovation is referred asthe development of the new ideas, processes, operationalcompetencies and value chain to distinguish the business from the otherplayers in the market, and to managethe cost of the retention and sustainability ofthe competitive edgeand position in themarket.The innovation is defined under the two categories I-e Sustaining and disruptive, which in other words are incrementalchanges or radical changes respectively. Manyorganizations undermining their business strategies and business models in a way to focustowards the sustaining technology(incrementalinnovation) in order to achieve the comparative edge in the market. However some organizations through pursuing the sustaining innovation strategy tends to jump to disruptive models in order to acquire the large marketopportunity and market gaps. Such can be seen from the development of smartphones, renewabletechnologies and other disruptive modelsthat have replaced the old sustaining technologies permanently.

Since sustaining technology or innovation is incremental in nature, the business models merely focuses on developing the new processes, operation or products that matches the customer demand.However, on the other hand, disruption or disruptive innovation or products are new in the market, that are usually unacceptable by the customers at the initial level and creates a slow market demand, however when the innovation becomes a part of the market and the product development processcompletes, it merely displaces the old technologyanddisturbs the business position of otherplayers in the market.

Disruptors and Challenges in the age of Uncertainty Harvard Case Solution & Analysis

According to (Christensen, 2007), the disruptors keeps the market at competition and evolving. They tend to offer the existing customer a new solutiontotheexisting problem through new technology or methods that offers more value to the customers and hence makes the business successful.He also argued it is due to these disruptive innovation in the market, that the businesseskeep the leadingposition in home regions andaswell as in the global markets.He further suggested that itis due to disruptive innovation models and distorts in the market thatleads to the global integration sinceit opens up the new market opportunities, the region lacking the expertise tends to connect with the disruptivebusinesses’ regions andhence initiates the global integration.

According to (Trott, 2012), Disruptiveinnovation have transformed many businesses like thedownloadable music has disrupted CD industryand the digital camera has disrupted the roll camera industry substantially. He suggested that it is due to the disruption, that the new models and technologies came into market.Although Trott has favored the disruptors and disruptive models, he argued that disruption acts in twoway direction. In one direction it opens up new markets and opportunities while on the other part it destroys the existingmarkets. (Christensen C. M., 2007)also favored the research by suggestingthat though many disruptive modelsperform highly betterthan the projected financial outcome, howevermany businesses find it unattractivedue to high cost associatedwith it, alongwith no market data, knowledge of consumer acceptability and the market trends that may support the disruption.