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<a href="http://www.claytonchristensen.com/books/the-innovators-dilemma/">The Innovators Dilemma</a> written by Clayton Christensen describe a business phenomenon that has always been around but never captured or well-studied before Christensen. In the book, Christensen argues that many companies that have suffered a dramatic decline have fallen not due to bad decisions or mismanagement, but because they have simply continued to make money and keep customers happy (<strong><u>or in the case of traditional mattress retailers keep shoppers un-happy</u></strong>). Hence the dilemma in the title: doing the right thing or the same thing as has been, could be the exactly the wrong thing to do.

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Disruptive companies are not necessarily the developers of amazing new technologies like Apple, as they can also be innovators that make products and services more accessible and affordable, thus putting them in reach of a much larger customer base. Christensen describes it as “<em>… a process by which a product or service takes root initially in simple applications at the bottom of a market and then relentlessly moves upmarket, eventually displacing established competitors</em>”

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<ol>
 	<li><strong> Disruptive innovation must start with a smaller company</strong></li>
</ol>
Notice we said “smaller” company, not small. The original definition of the disruption theory describes a process whereby a smaller company with fewer resources is able to successfully challenge established incumbent businesses.

Here’s how it works: larger, more established companies begin to focus on improving their products and services for their most demanding customers. This leads them to overlook customers who may not be able to afford their high-quality services. In this situation, a smaller, disruptive innovator swoops in and offers a product to those overlooked corporations, which brings us to our next point.

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<ol start="2">
 	<li><strong> What Disruptive Companies are <u>NOT</u>, PREDICTABLE:</strong></li>
</ol>
Many of these disruptors have commonalities in their business models and transformations. But instead of looking just at what great innovators do, you need to examine what they don’t do. And one trait that is missing from nearly all recent disruptive innovators is predictability. To innovate, you need to let go of traditional organizational practices and the kind of control it engenders. Planning becomes a fluid process and the organization must be structured in a loose enough way that innovation can be captured and allowed to grow uninhibited without being constricted by the established barriers. Incremental innovation and improvement in products or programs is enabled by truly agile businesses where the product or program doesn’t have to be perfect when launched. A solution is identified, implemented and developed within the company through collaborative testing, launched, and then refined through feedback on the user experience. By definition, an innovative disruptor doesn’t create a breakthrough, but starts small and moves up by refining the product and capturing a greater share of the market as it does—a trait that is exploited by an agile, highly socialized, platform-oriented business with fluid communication

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<ol start="3">
 	<li><strong> Disruptive innovation may originate in a low-end foothold</strong></li>
</ol>
According to a recent Harvard Business Review article, there are two types of markets that incumbent players tend to overlook; the first is the low-end foothold. These exist because companies are so focused on providing the most high-end products to their top-paying clients that they tend to neglect those clients who don’t require as much. This opens the door for disruptive innovators to offer “good enough” products to those clients.

The established companies often disregard the disruptive innovators at first because they are so focused on their higher paying clients. This gives the disruptive innovators time to grow and expand and eventually capture a greater client base. By the time the established company discovers what is happening, it is too late to counter. Thus, the disruption theory takes place.

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<ol start="4">
 	<li><strong> Disruptive innovation may originate in a new-market foothold</strong></li>
</ol>
The other group often overlooked by incumbents is the new-market foothold; this foothold exists when disrupters create a market where there was not one before. According the Harvard Business Review, they turn non-consumers into consumers. New markets typically do not attract well-established businesses because of the strategic work required to get their attention. Disruptive innovators are willing to put in the time and effort to creatively reach out to these new markets and capture the fresh audience.

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<ol start="5">
 	<li><strong> Disruptive Companies understand communication both internally within its leaders and externally to customers</strong></li>
</ol>
Open and connected communication within an organization: The sharing culture is also a common theme among innovators, with greater success being realized in corporations. This is a practicality that revolves around the age-old adage that two heads are better than one, and that hard work is rewarded. Giving people access to the ideas of others and letting them develop those ideas as a team—then rewarding proportionally—promotes collaborative problem-solving. Direct Customer Communication: A major asset developed and utilized by disruptive innovators is a direct channel of communication with the user (often the creator of value also), which facilitates the rapid identification of problems, development of ideas, and feedback on development or can create an enhanced selling scenario wherein value is conveyed.

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