*Rereleased in 2024 by Harvard Business Review, with new foreword*

One of the most influential business books of all time, innovation expert and Innosight cofounder Clayton Christensen shows how even the most outstanding companies can do everything right yet still lose market leadership.

Now with a foreword by Marc Benioff, the cofounder and CEO of Salesforce.

“​The Innovator’s Dilemma” explores how successful companies can do everything “right” and still lose their market leadership or even fail as new, unexpected competitors rise and take over the market. Key insights include:

Buy the book at Harvard Business Review.

Disruptive Technologies: Christensen introduces the concept of disruptive technologies which are innovations that significantly alter the way businesses or entire industries operate. These innovations often start off worse in terms of performance compared to existing technologies, but they gradually improve and eventually surpass the old technology.

Market Leaders’ Predicament: The dilemma lies in the fact that market-leading companies often ignore the disruptive technologies because initially they do not meet the needs of their mainstream customers or the performance standards of existing markets. Instead, these companies focus on sustaining innovations, which are improvements to their existing products that are valued by their current customers.

Customer Dependence: Established companies are dependent on their customers and investors, which can limit their ability to invest in disruptive technologies. These companies prioritize technologies that promise better returns from their existing customer base, overlooking the potential of emerging markets.

Value Network: Every company operates within a value network, which includes customers, suppliers, and employees, all of whom have an influence on what a company can and cannot do. Disruptive technologies often find a foothold in new or emerging value networks.

Strategic Choices: Successful companies can fend off the threat of disruption by creating separate divisions tasked with adopting and developing the disruptive technology. These divisions should operate independently, allowing them the freedom to develop the technology in a market segment away from the main business’s core customers.

Christensen draws on case studies from the still and computer industries. His analysis shows why some companies make great leaps and why others fail to adapt, providing valuable insights into the forces that shape competitive business landscapes.