How to Overcome the Innovator’s Dilemma In his landmark book “The Innovator’s Dilemma” Clayton Christensen showed how the once innovative and by now successful companies can do everything “right” and yet still fail – as new, unexpected competitors rise and take over the market. Thanks to Clayton Christensen the world became aware that relying on the standard set of strategy tools does not suffice. He went far beyond Porter and portfolio management. As the titles of his great book “Competitive Strategy” suggest Michael E. Porter tried to support strategists in dealing with their direct rivals. Furthermore, he gave as the means to analyze the attractiveness of industries. For this Porter’s “Five Forces” became kind of a standard. But it is all about comparing Pepsi with Coke, Mc Donald with Burger King, BMW with Audi and Mercedes and their respective industries. In short it is about benchmarking. How to break rules or how to reinvent the rules of the game is not of interest. And this is also true for all the portfolios that were introduced by Boston Consulting, McKinsey & Co. Clayton Christensen invented the term “Disruptive innovation”. It refers to an innovation that creates a new market and relies on a new business model and eventually disrupts an existing market and existing value networks, displacing established market leading firms and products. However, despite its subtitle “The Revolutionary Book that Will Change the Way you Do Business” the Innovator’s Dilemma is falling short of providing advice how companies can actually come up with ground-breaking innovations. Several authors tried to overcome the shortcoming. First W. Chan Kim, and Renee Mauborgne with “Blue Ocean Strategy: How to Create Uncontested Market Space and Make the Competition Irrelevant” in 2005., Alexander Osterwalder in 2010 with ”Business Model Generation: A Handbook for Visionaries, Game Changers, and Challengers” In 2015 Oliver Gassmann with “The Business Model Navigator: 55 Models That Will Revolutionise Your Business”. No matter how convincing all these approaches appear to be, they have not made established organizations more innovative. The examples in this presentation make this more than obvious. Despite all insights and approaches the established are still trapped in the innovators dilemma. To do the new they need to sacrifice the given. To make the jump they need to be confronted with what could put them out of business, what would shut them down. However, established organizations are able to make the jump when they become aware of their Nightmare Competitors at an early stage. We help them to design their own Nightmare Competitors. This creates the urge to occupy the market first. To learn more, have a look at presentation 2: “Disrupt before being disrupted”. A more extensive description is provided in “Rocking the Ship: Turning Corporate Managers into Business Model Mavericks” published on October 6, 2017 by Uli Grothe and Mat Lock.

1. Rocking Business Innovation | 1© NC-Creators
1. How to overcome the
Innovator’s Dilemma

2. Rocking Business Innovation | 2© NC-Creators
Why was Ryanair not
invented by flag carrying
airlines?
Why was Skype
not invented by the
telephone companies?
Why was Body Shop
not invented by the
cosmetics industry?
Established players struggle immensely to come up with ground-breaking
business innovations
Why was Salesforce not
invented by the B2B
software industry?
Why was Instagram not
invented by camera
manufacturers?
Why was Craigslist not
invented by newspaper
companies?
Why was Starbucks
not invented by traditional
coffee companies?
Why was the iPhone
not invented by mobile
phone companies?

3. Rocking Business Innovation | 3© NC-Creators
Uber is
revolutionizing short
distance rides
Whole Foods shows
that organic nutrition
can be delicious
Double Robotics is
making traveling
obsolete
Whereas start-ups seem to be able to redefine whole industries with great ease
Airbnb is giving the
global accommodation
industry a hard time
PayPal has made
online payments a
pleasure
Spotify is changing
the way we listen to
music
SpaceX is turning
satellite launches into a
commodity
Tesla is leading the world
into the age of electro
mobility

4. Rocking Business Innovation | 4© NC-Creators
Clayton Christensen demonstrates how the once
innovative and by now successful companies can do
everything “right” and yet still lose their market leadership –
or even fail – as new, unexpected competitors rise and
take over the market.
However, despite the claim “The Revolutionary Book that
Will Change the Way you Do Business” the book falls short
of providing methods how companies can innovate.
It is simply explaining the dilemma.
Clayton Christensen describing the phenomenon in his landmark book “The
Innovator’s Dilemma” as early as 1997

5. Rocking Business Innovation | 5© NC-Creators
It becomes apparent that the standards tools of strategic management are not
part of the solution. They are rather part of the problem

6. Rocking Business Innovation | 6© NC-Creators
Tools for Business Innovation were designed to overcome the problem

7. Rocking Business Innovation | 7© NC-Creators
Applying the traditional tools of
strategic management has not
enabled established companies
sufficiently
to come up with ground-breaking
new business models. Most
resemble powerful, huge
spaceships bound to
follow the once
defined direction
In a world where it is more and
more about disrupting or being
disrupted this is no longer
sufficient

8. Rocking Business Innovation | 8© NC-Creators
“We need to identify the things that
would shut us down and then try to do
that because that is what is happening
tomorrow” Attendee Nightmare Competitor Workshop

9. Rocking Business Innovation | 9© NC-Creators
Go to slideshare.net to download core elements of the Nightmare Competitor
Approach

10. Rocking Business Innovation | 10© NC-Creators
www.nc-creators.com