INNOBLOG

Occasionally we come across an innovation that looks like a disruptive innovation on first glance, but upon further consideration turns out to be a sustaining innovation. In situations like these, asking the right questions is critical. Take for example the new Firefly mobile phone. A pretty neat concept, the phone is designed for young children (the target is ages 8 to 12). Without a keypad, children don't have to remember phone numbers and parents don't have to worry about children making outside calls. And none of that time wasting, distracting text messaging which is so bothersome in the class room.

On the surface, this might appear to be a disruptive innovation. A simple (almost toy-like) product that enables usage by a new market. And yet, if we ask the right questions, we discover that the Firefly is more of a sustaining innovation and if it gains any traction in the market, incumbents are likely to take over the market.

The first question to ask should be "is the innovation low-end or sustaining?" In the case of the Firefly, it is a new market disruption. It wouldn't be considered a low-end disruption, because at $99.99, it's much more expensive than your average mobile phone and it's functionality is not even good-enough for the regular mobile phone market.

Now, when evaluating a new market disruption, two sets of questions must be answered. First, "is there a large population of people who historically have not had the money, equipment or skill to do this thing for themselves and as a result have gone without?" Certainly a lot of young children have gone without, either because a regular cell phone was too complicated or because parents felt it inappropriate to give a young child a cell phone. Is the market large? That is up for debate in this case. For Firefly the answer is clearly yes, but it is less clear for a phone manufacturer like Nokia.

Second, "is the innovation disruptive to all the major incumbents? In this case the answer is no. There is nothing unique about the Firefly from the perspective of Nokia. It is simply a stripped down cell phone with limited capabilities. Such a product would be fairly easy for them to develop (setting aside the issue of product design for the moment). Additionally, with a new market disruption, as the product improves it pulls customers from the original value network into a new value network. In the case of the Firefly, the concept was to take a cell phone and strip it down. As the product improves, it ends up competing at the low-end of the existing value network, not creating a new one.

When it comes to innovations, asking the right questions is critical.