Chapter 7 pt 2 - Test 2 Flashcards
Technology Enthusiasts
- Enter the market during the introductory stage
- Have an engineering mind
- Proactively pursue new technology
- Smallest market segment (2.5%)
Early Adopters
- Enter the market during the growth stage
- Demand is driven by imagination and creativity
- Directly communicate the product’s potential
Early Majority
- Enter the market during the shakeout stage
- This group is key to catching the growth wave
Late Majority
- Enter the market during the maturity stage
- Represent the majority of the market
- Typically buy from well-established firms with a strong brand
Laggards
- Enter the market during the decline stage
- Demand is small
New Market, New Technologies
Radical Innovation
New Market, Existing Technologies
Architectural Innovation
Existing Market, New Technologies
Disruptive Innovation
Existing Market, Existing Technologies
Incremental Innovation
Incremental Innovation
- Builds on established knowledge
- Results from steady improvement
Radical Innovation
An entirely new knowledge base or recombination of
existing knowledge that targets new markets and
technology
Why Incumbent Firms Tend to Focus on Incremental Innovation
- Economic Incentives
- Organizational Inertia
- Innovation Ecosystem
Innovation Ecosystem
They rely on certain suppliers, buyers, complementors
Organizational Inertia
They have formalized processes and structures
Economic Incentives
They must defend their position
Architectural Innovation
Existing technology leveraged into a new
market with known components, and existing technology used in a novel way
Disruptive Innovation
Leverages new technologies in existing markets using new products/processes to meet existing customer needs
How to Respond to Disruptive Innovation
- Continue to innovate to stay ahead of the
competition - Guard against disruptive innovation by protecting
the low end of the market - Disrupt yourself rather than wait for others to disrupt you
Platform Business
Enables interaction between producers and
consumers
