Clayton Christensen (1952–2020) was a Harvard Business School professor whose theory of disruptive innovation explained why competent, well-managed companies lose to inferior products.

The innovator's dilemma

The Innovator's Dilemma (1997) began with a puzzle drawn from the disk drive industry. The firms that failed were not badly run; they were run according to the practices that are normally correct. They listened to their best customers, invested in higher margins, and improved products along the dimensions those customers valued.

A disruptive product enters at the bottom. It is worse on the established measures, cheaper, and appeals to customers the incumbent does not want. The rational response is to ignore it, since serving that segment would dilute margins. The entrant then improves until it is good enough for the mainstream, at a cost structure the incumbent cannot match.

The dilemma is that the failure follows from good management rather than bad. Doing the correct thing at each decision produces the wrong outcome overall, which is why the pattern repeats across industries.

Jobs to be done

Christensen later argued that customers do not buy products so much as hire them to make progress in a circumstance — the job to be done. Demographic categories describe who buys and explain little about why, whereas the circumstance does. The framing shifts market definition from product categories to the situations customers are in, and connects to positioning.

Limits

The theory has been contested, most prominently by Jill Lepore in 2014, who argued the case studies were selected to fit and that the predictive record is weaker than claimed. Christensen also acknowledged that disruption describes a specific mechanism and had come to be used loosely for any significant change. Used precisely, it remains the best available account of why incumbents with every advantage lose.