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Disruptive Innovation (per the Christensen model) generally takes place in an industry dominated by an oligopoly and having an unserved segment ( towards the lower end in terms of profit margins and product capability) which attains visibility as a result of technological expansion in what is most of the time, a non-related field.
A similar proposal to Split Finance would likely have been rejected out of hand by organization leaders (and Harvard Business Review editors), because its obvious that the Finance function must fit the organization strategy and leader capabilities. Yet this evidence is apparently not well-known.
As Clayton Christensen likes to note , the primary job of leadership today is to “source, assemble, and ship numbers.” Thought leaders like Christensen, Roger Martin , Michael Porter , and Steve Denning have all argued that shareholder value has been exposed as a flawed paradigm. No, it’s to maximize shareholder value.
In fact, Amazon was only operating at such a high burn rate because it could. Well, he's a hedge fund veteran who has always taken a skeptical view of Wall Street, treating it more as a loopy rich uncle than the efficient information processor of standard finance theory. Most turn out not to. With Amazon, though, nobody emphasizes EPS.
Anyone who has operated inside a big corporate will tell you that for any project, you might have an executive mandate. No longer is the organization relying on gut instinct and a shared sense of purpose around delivering product value; instead, most large organizations rely on process controls to standardize operations.
Moore and Christensen tell us what to do, but their prescription is rarely followed. David Locke Innovation fails because of management, not the innovation. Unfortunately the approach you are taking is standard management, which in the case of discontinuous/radical/disruptive innovations fails. I look forward to hearing more from you.
Transformational CEOs Tend to be “Insider Outsiders” The list is topped by companies headed by visionary founders with no prior experience in their industries; Jeff Bezos came from the world of finance, and Reed Hastings from software. Clay Christensen , Professor at Harvard Business School and Innosight co-founder.
This is the essence of Groupon's declaration last week that it will remove the controversial accounting metric called Adjusted Consolidated Segment Operating Income (ACSOI) from its financial statements. Finally, reaching profitability quickly ensures that when outside financing dries up, the venture can succeed on its own.
Disruption is a systemic problem: Clayton Christensen outlined in 1997 why it was so difficult for any individual business to defuse disruptive threats and embrace disruptive trends. They’ve read Christensen’s book The Innovator’s Dilemma. Asset-light businesses are not financed with debt.
But because we failed to hammer out exactly how we would operate (including our respective roles and responsibilities), infighting distracted from operating, cash became a concern, and the business slowly, then quickly, imploded. My husband and I lost a painful lot of money. It was devastating. It was devastating.
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