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It was in your home, had no shelf space limiting its inventory, and could beat Tower on price because of its lower fixedcosts. With a basic grasp of technology innovation trends, Tower should have known as much and immediately begun running around with its hair on fire. It's business model innovation.
These businesses have powerful disruptive potential because they can provide consulting at a fraction of the cost of traditional models, largely because they do not need to carry expensive fixedcosts like recruiting, training, consultant “beach” time, and expensive real estate. Consulting Disruptiveinnovation'
The need to decentralize organizations around employees — viewing them as assets capable of expanding growth rather than as fixedcosts to be eliminated — and to move away from standardized and tightly-specified process flows. Business education Disruptiveinnovation Managing uncertainty'
Disruption is an explanation of how small nimble companies unseat industry giants – but it is simultaneously a story of market expansion and the provision of ever cheaper and more accessible goods and services. Disruptiveinnovation Technology'
That gave it a steadier cash flow to cover the costs of its large fixedcost investments, but did not eliminate the unused capacity of plants dedicated to one kind of product. Before, a big conglomerate like GE diversified its risks by mixing pro-cyclical and counter-cyclical businesses.
The costly and complex operations of transporting energy have made utilities natural monopolies, while regulatory barriers and the high fixedcosts of building and maintaining regional electrical grid infrastructure have also kept much competition at bay.
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