Lepore challenges 'The Innovator's Dilemma,' Christensen responds

Is “The Innovator's Dilemma” not a dilemma after all? The theory, described in Clayton M. Christensen's 1997 book of the same name, contends that when large and previously successful companies fail, it's not because managers began doing the wrong things, but that they continued to do the right things—those things that had led to the companies' success in the first place. Unfortunately, according to the theory, doing the right thing can be the wrong thing when you are faced with “disruptive innovation”—competitors offering inferior products but at lower prices.

In the current print edition of The New Yorker, Harvard history professor Jill Lepore attacks the theory—perhaps motivated by the proliferation of “disruption” consultants, conferences, seminars, and even college degrees. She may also have been prompted to discuss the topic now by potential disruption she may face as a staff writer at The New Yorker and highly publicized consternation at The New York Times surrounding the firing of executive editor Jill Abramson and the leak of an internal report on how the Times views disruption.

You can read Lepore's lengthy article here now, although it may end up behind a pay wall. Or, as Slate's Will Oremus puts it, “You could pay $6.99 in the United States or $7.99 abroad to buy the magazine and then devote half an hour to reading her story.”

Oremus offers yet a third option—read his snarky summary, which purports to disrupt The New Yorker's own business model: “No doubt my online opinion column about Lepore’s story will be inferior to the original work in many ways. After all, I’m writing this in the space of a few hours, whereas she presumably devoted weeks or months to researching and developing her thesis. The New Yorker paid teams of fact-checkers and high-ranking editors to peruse her prose, layout editors to arrange it on the page, cartoonists to illustrate it, a printing press to print it, and the postal service to distribute it far and wide. We just loaded this into an online content management system, grabbed a stock image of Christensen, and hit 'publish,' at virtually no marginal cost to Slate.”

Lepore's main contention is that Christensen in his book hand-picked case studies that don't actually support his point. One of his focuses is the disk drive market. Without belaboring the many iterations of Alan Shugart's businesses, his Seagate Technologies had, by the mid-eighties, become an established firm (having previously been a disrupting firm that, with its 5.25-in. hard-disk drive, disrupted the incumbent 14-in. drive business). Seagate, contended Christensen, was too slow to move to 3.5-in. disks, and the company failed to achieve Christensen's sales metrics for success by 1989.

However, writes Lepore, “In fact, Seagate Technology was not felled by disruption. Between 1989 and 1990, its sales doubled, reaching $2.4 billion, 'more than all of its U.S. competitors combined,' according to an industry report. In 1997, the year Christensen published The Innovator’s Dilemma, Seagate was the largest company in the disk-drive industry, reporting revenues of nine billion dollars. Last year, Seagate shipped its two-billionth disk drive. Most of the entrant firms celebrated by Christensen as triumphant disrupters, on the other hand, no longer exist, their success having been in some cases brief and in others illusory.”

Perhaps one of Christensen's most notorious predictions (although obviously not included in his 1997 book) was his 2007 contention that the iPhone would fail. Writes Lepore, “In its first five years, the iPhone generated a hundred and fifty billion dollars of revenue.”

Christensen has responded to Lepore's criticism in a phone conversation with Drake Bennett of Bloomberg Businessweek. Unfortunately, Christensen didn't discuss the disk-drive example, but he did offer an interesting perspective on the iPhone. He originally viewed it as a sustaining innovation that would have a tough time competing with phones from Nokia, for example. In fact, it was a disruptive product competing with the laptop.

Christensen did applaud Lepore for attempting to rein in proliferating and random use of the word disruption. “The word is used to justify whatever anybody—an entrepreneur or a college student—wants to do,” he said. “…I was delighted that somebody with her standing would join me in trying to bring discipline and understanding around a very useful theory. I’ve been trying to do it for 20 years.”

Christensen concluded his conversation with Bennett by suggesting Lepore cross the Charles to talk with him (he is at Harvard Business School). “And so,” he told Bennett, “if she’s interested and wants to help me—she’s just an extraordinary writer—and if she’s interested in the theory or its impact, I mean, come over! I would love to have you openly invite her to come do this, if she’s interested.”