Clay Christensen’s Lasting Impact On How We Think About Innovation

Clayton M. Christensen, Professor of Business Administration at the Harvard Business School

The Innovator’s Dilemma was published in 1997 by Harvard Business School professor Clayton M. Christensen. The Economist named it one of the six most important books about business ever written. George Gilder, author, and supply-side economics pioneer, called it “a masterpiece…the most profound and useful business book ever written about innovation.”

The book was a revolutionary work that helped explain how well-run companies can fail when innovation creates new competition. This may seem like a subject reserved for tech entrepreneurs or business school faculty, but ultimately innovation affects everyone’s life in some capacity. Clay’s theory of “disruptive innovation” has become a must-read for anybody interested in innovation and has shaped the thinking of business leaders around the world.  

A firsthand encounter with the innovator’s dilemma

Cree Research (now Cree) was an early pioneer in the development of blue LEDs. This is the technology that would power the LED lighting revolution and the eventual obsolescence of the Edison light bulb. But in the 1990s, it could be intimidating for small companies like Cree working on these disruptive new products. Cree believed in the incredible potential of the technology, but the big lighting companies weren’t interested. What did they know that Cree didn’t? These companies had been in the lighting business for over 100 years and controlled over 70% of the world’s market for light bulbs. They had orders of magnitude more resources, hundreds of years more experience in both business and technology development, and far more financial resources. Why couldn’t they see the potential of this new technology? 

The light bulb goes off

When The Innovator’s Dilemma came out in 1997, what was happening at the big lighting companies started to make sense. These companies were well aware of the new technology; they just couldn’t change their thinking to take advantage of it. They had become too good at making light bulbs.

One of the core principles of Clay’s theory is: the things that make well-managed companies successful are the same things that eventually lead to their downfall.

While technology is often the means to enable disruptive innovation, the opportunity comes from understanding human behavior.  These organizations are able to maximize achievement over a long period of time, but their success inherently becomes focused on shorter-term metrics. These metrics make it nearly impossible to take big risks, invest in longer-term ideas, and react to potentially disruptive new technology or business models. These businesses become a victim of their own success as they fall into the trap of you get what you measure. 

While this book was a revelation for the team at Cree, it doesn’t contain any examples of LEDs or lighting. The book talks about disruption in the steel industry, mechanical excavators, and disk drives, but what it really describes is behaviors; why these companies and the people running them act the way they do. And that is why it is still relevant today. Innovation is ultimately about people. The book doesn’t teach you what to think about problems; it teaches you how to think about problems.

Thinking beyond business

In 2010, Clayton Christensen published an article titled How Will You Measure Your Life, which talks about the three questions he asks his business school students to think about on the last day of class. They are: 

While these questions might seem unrelated to his previous work on innovation, they are some of the same concepts applied to a different context—our personal lives. Most people wait until too late in their careers to ask themselves these questions. Ultimately, in both business and life, it’s not just about doing things right, it’s about doing the right things and their impact on those around you.

Clayton M. Christen passed away on Friday, January 24, 2020. I never met him in person, only through his books, papers, and talks that are available on YouTube, but his work shaped much of my thinking about innovation. As Clay said, “I had thought the destination was what was important, but it turned out it was the journey.” His journey inspired me and continues to inspire the next generation of innovators and leaders.