Clayton M. Christensen

(Clayton Magleby Christensen)

Clayton M. Christensen
Clayton M. Christensen
  • Born: April 6, 1952
  • Nationality: American
  • Profession: Teacher & Consultant

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A disruptive innovation is a technologically simple innovation in the form of a product, service, or business model that takes root in a tier of the market that is unattractive to the established leaders in an industry. Business, Commerce & Finance
A great book seeks to explain causality, not correlation. It works to point out the circumstances in which it works, and where it doesn't. And in so doing, it is broadly applicable.
A major driver of the cost of healthcare in the United States is a compromise that was reached with the American Medical Association in the 1960s when Medicare was first established. Health, Healthcare & Medicine
A sustaining innovation makes better products that you can sell for better profits to your best customers.
Almost always, great new ideas don't emerge from within a single person or function, but at the intersection of functions or people that have never met before.
American capitalists, enthralled by the doctrines of finance, have put their income statements in service of the balance sheet. Business, Commerce & Finance
An innovation will get traction only if it helps people get something that they're already doing in their lives done better.
As a general rule, if you have a product that doesn't get the job done that a customer is needing to get done, then often you have to offer it for zero. Because if you ask for money for it - because if it doesn't do the job well, they won't pay for it. Money, Coins & Minting
As a general rule, when a new industry takes root, and the first products emerge in a wave, almost always the architecture of the product will be proprietary and interdependent in character.
As I have studied the Bible and the Book of Mormon, I have come to know through the power of the Spirit of God, that these books contain the fullness of the gospel of Jesus Christ. Power ;Religion & God
Because we employ no professional preachers, it means that every sermon or lesson in church is given by a regular member - women and men, children and grandparents. Women
Businesses that distribute information and news are in the business of training and teaching people. Business, Commerce & Finance
By doing what they must do to keep their margins strong and their stock price healthy, every company paves the way for its own disruption.
Capitalists seem uninterested in capitalism, even as eager entrepreneurs can't get financing. Businesses and investors sound like the Ancient Mariner, who complained, 'Water, water everywhere - nor any drop to drink.'
Children are ready to learn when they are ready to learn, not necessarily when their parents are ready to teach them.
Christine and I haven't raised our children. A whole community of selfless Christians has contributed to helping them become faithful, competent adults.
Colleges would compete by adding professors, enhancing programs, or building nicer facilities. So they competed by making institutions better.
Companies, in fact, are specifically organized to under-invest in disruptive innovations! This is one reason why we often suggest that companies set up separate teams or groups to commercialize disruptive innovations. When disruptive innovations have to fight with other innovations for resources, they tend to lose out.
Diabetes is a great example whereby, giving the patient the tools, you can manage yourself very well.
Disruption is continuously afoot in every industry, but especially in autos. It is how Toyota, Nissan and Honda bloodied Detroit: They did not start their attack with Lexus, Infiniti and Acura, but with low-end subcompact models branded Corona, Datsun and CVCC.
'Disruption' is, at its core, a really powerful idea. Everyone hijacks the idea to do whatever they want now. It's the same way people hijacked the word 'paradigm' to justify lame things they're trying to sell to mankind.
Do not be deceived by impostors.
During the early stages of an industry, when the functionality and reliability of a product isn't yet adequate to meet customer's needs, a proprietary solution is almost always the right solution - because it allows you to knit all the pieces together in an optimized way.
Each of our children during their high school years went to 'early morning seminary' - scripture study classes that met in the home of a church member every school day morning from 6:30 until 7:15. Morning
Efficiency innovations are a natural part of the economic cycle, but these are the innovations that streamline process and actually reduce the number of available jobs.
Efficiency innovations arise in industries that already exist. They provide existing goods and services at much lower costs. They are not empowering. Efficiency innovators become the low cost providers within an existing framework.
Efficiency innovations provide return on investment in 12-18 months. Empowering innovations take 5-10 years to yield a return. We have ample capital - oceans of capital - that is being reinvested into efficiency innovation.
Eighty percent of the cases used in the typical MBA program are about successful companies. Students graduate with this notion that 'If I do everything that the people in those cases did, then my organization will grow and be successful, too.'
Empowering innovations require long-term investments, which tie up capital for years and years. So companies are using capital to create more capital, and consequently, the world is awash in capital, but the innovations we need to advance aren't there.
Empowering innovations transform something that is complicated and expensive into something that is so much more simple and affordable that a much larger population can enjoy it.
Every city and town in America would be bankrupt if they kept their books the way private-sector companies keep their books - because of the obligation cities and towns have taken upon themselves to provide health care for their retirees. Health, Healthcare & Medicine
Finding a 'sacrificial lamb' on whom to tag blame for complicated problems is an important instrument in the toolkit of politicians, because it deflects blame for the nation's economic woes away from their own regulatory lapses, economic mismanagement and coddling to labor unions.
For 300 years, higher education was not disruptable because there was no technological core. Education, Learning, Knowledge & Training
For online universities, like Liverpool and the University of Phoenix, if prices drop by 60%, they still make money. But for the vast majority of traditional universities, if the prices fall by 10%, they are bankrupt; they have no wriggle room. Money, Coins & Minting
From my first year on the faculty, there was always so much more I wanted to impart to the students. I decided that, rather than waste the last day of class summarizing the semester, I'd spend my time talking about what I'd learned in life that was useful. Life ;Time
Funding that is focused on the ability to diagnose diseases precisely will just have inestimable value because that's the gate through which precision medicine has to go. Unless you can diagnose the disease precisely, care has to remain in the hands of expensive institutions and expensive caregivers.
Growth makes management easier. In particular, it makes making labor concessions seem easy. It's when growth stops because you're being disrupted that managing becomes really, really hard, and as a result, most disrupted companies simply disappear.
Having a loving relationship with our spouse or with our children is what leads to the long-term happiness we all seek. Happiness & Unhappiness
Holiday Inn comes in at the bottom of the market, but they can't go upmarket except if they emulate the Four Seasons. So they can go up, but they have to emulate the people they're trying to compete against. They can't disrupt them, because there isn't anything about their model that is extendable upmarket.
I believe that we can, in a deliberate way, articulate the kind of people we want to become. We can articulate the culture that we would want to exist in our family, and you can then, as the rest of life happens to you, you can utilize those things to help you become the kind of person you want to be.
I brought one big question with me to Harvard. Why do smart companies fail?
I don't feel that this concept of disruptive technology is the solution for everybody. But I think it's very important for innovators to understand what we've learned about established companies' motivation to target obvious profitable markets - and about their inability to find emerging ones. The evidence is just overwhelming. Science, Mathematics, Engineering & Technology
I don't have my finger on the pulse of corruption in China, but I think most people on the ground would say that as China was emerging from communism, it was a very regulated society, and therefore, it was very corrupt. But as they have deregulated the economy, there just aren't as many opportunities for people to be corrupt. Society
I got Type 1 diabetes at 30. It hit me in 1982 when I was a White House Fellow in Washington. I had viral pneumonia. I lost 35 pounds in six weeks. And I couldn't see anything. Everything was blurry. I was always thirsty.
I had a horrible heart attack and still have symptoms of that sometimes. Then cancer, which is in remission. But the stroke is the hardest thing because I just lost my ability to speak and to write.
I have been blessed to see visions of eternity; and events in my future that have been important for me to foresee, have been revealed to me. Future
I have continued systematically to study the Book of Mormon and Bible to understand even more deeply what God expects of me and my family while on this earth. Religion & God ;Families, Children & Parenting
I have healed the sick by the power of the God. I have spoken with the gift of tongues. Power ;Religion & God
I haven't met too many people that don't intend to have a fulfilling life. High-achievers, however, end up allocating their resources in a way that seriously undermines their intended strategy. Life
I love my life as a missionary, keeping myself on the front lines. The image in my mind is that God, my general, stands at the door when I go out every morning; and, knowing what the war is like, day after day he gives me his most powerful weapon: his Spirit. For this I am grateful. Life ;Love, Romance, Marriage & Sex ;Morning
I promise my students that if they take the time to figure out their life purpose, they'll look back on it as the most important thing they discovered while at school. If they don't figure it out, they will just sail off without a rudder and get buffeted in the very rough seas of life. Life ;Time
I talk to our kids now that they are grown up, and I ask them about the experiences that had growing up that really had a powerful influence on the way they view the purpose of life. The experiences that really shaped their values - my wife and I have no memory of those experiences! Life
I think this is one reason why the Lord invented the Internet - so members can teach one another how to succeed in assignments the Lord has given us, and to give us opportunities to inspire and bear testimony in a horizontal way.
I wouldn't say there isn't a direct path to a successful career. There are people who knew exactly what they wanted to do from a very young age, weren't going to be diverted, and then they just went out and achieved it.
I'd been raised Mormon, but there comes a time where you are not following what you've been taught, but discovering for yourself if it's true. Time
If we are to develop profound theory to solve the intractable problems in our societally-critical domains... we must learn to crawl into the life of what makes people tick. Life
If you develop a product that gets what the customer is trying to get done, you don't have to advertise; people will just pull it into their lives.
If you make that decision, that you'll always follow that rule, then your commitment to do it sinks into your heart, and when you realize the benefits of having integrity time after time, it really changes your heart, not just your head. Time
If you understand cause and effect, it brings about a set of insights that leads you to a very different place. The knowledge will persuade you that the market isn't organized by customer category or by product category. If you understand the job that consumers need to complete, you can articulate all of the experiences in that job. Education, Learning, Knowledge & Training
If you're successful and growing, you can manage any way you want to. Growth makes so many dimensions of management easier. It's when growth stops that things get tough.
I'm an optimistic person.
In a healthy economy, empowering, sustaining and efficiency innovations operate in balance. A healthy economy creates and sustains more jobs before squeezing out inefficiencies.
In an environment where you've got to push innovations out the door fast and keep the cost of innovation low, the probability that you'll be successful is actually much higher.
In organizations, once you articulate how success will be measured, everybody tries to game the system so that they are measured in the best possible way. Success
In our personal lives, we have a lot of businesses going on. I have a profession, I'm a father, a spouse, a good member of my community. How much of my time and energy can I allocate to each of those things? What I allocate becomes the strategy I have for my family, and everything else. Time ;Families, Children & Parenting
In the Mormon Church, we believe we can be married for all eternity, not till death do you part. As Mom was getting older, she was excited, truly excited, that within a few years she'd be with Dad again. Death ;Families, Children & Parenting
In the scriptures, we are told you can't really understand happiness unless you understand sadness. You don't know pleasure if you don't know pain. It's part of life. So can you learn something from somebody who has gone from success to success to success? I don't think so. Life ;Happiness & Unhappiness ;Success
India's prosperity is sectioned by geography, such as in Bangalore, where the information technology industry is prominent. Because they have a conduit out of India, competing in the world by the Internet, it's not regulated in corrupt ways, and it is very prosperous. Science, Mathematics, Engineering & Technology
Innovation almost always is not successful the first time out. You try something, and it doesn't work, and it takes confidence to say we haven't failed yet... Ultimately, you become commercially successful. Time ;Work, Workers & The Labor Force
Inviting others to help us with our work in the Church helps them feel needed and helps them feel the Spirit. When these feelings come, many people often then realize that something has been missing from their lives. Work, Workers & The Labor Force
Life is an unending stream of extenuating circumstances. Life
Management is getting people together to figure out how to transform inputs into outputs. In the process of figuring out the process of how people work together, you've got to figure out who's got what responsibilities, and how do they work together. Work, Workers & The Labor Force
Management is the opportunity to help people become better people. Practiced that way, it's a magnificent profession.
Management teams aren't good at asking questions. In business school, we train them to be good at giving answers. Business, Commerce & Finance
Managers are already voracious consumers of theory. Every time they make a decision or take action, it's based on some theory that leads them to believe that action will lead to the right result. The problem is, most managers aren't aware of the theories they're using, and they often use the wrong theories for the situation. Time
Many of the factors that we think will cause motivation, such as fair pay and a good manager, won't make you love your job. Even if you eliminate what makes you dissatisfied, that doesn't make you motivated. It doesn't make your work rewarding. You just are less bothered by things. Love, Romance, Marriage & Sex ;Work, Workers & The Labor Force
Many think of management as cutting deals and laying people off and hiring people and buying and selling companies. That's not management, that's deal making. Management is the opportunity to help people become better people. Practiced that way, it's a magnificent profession.
Most marketers think there's a concept called a product life cycle. Once you realize that the world is organized by jobs that need to be done, you understand that product life cycles don't exist. Life
Most people have never thought through how they're going to allocate their time. You need to make a decision in advance. Time
No idea for a new growth business ever comes fully shaped. When it emerges, it's half-baked, and it then goes through a process of becoming fully shaped. Business, Commerce & Finance
One of the banes of successful innovation is that companies may be so committed to innovation that they will give the innovators a lot of money to spend. Money, Coins & Minting
Optimizing return on capital will generate less growth than optimizing return on education. Education, Learning, Knowledge & Training
People don't actually want to think about their own health and don't take action until they are sick. Yet employers are very motivated to get their employees healthy, since they bear most of the burden of their health care costs. Health, Healthcare & Medicine
People have an idol they want to be like and try to follow what the idols did. But when you do, you find out you're not very successful and you're not very happy. You try to copy these models, and it doesn't yield successful results.
People in private equity complain that they have so much capital and so few places to invest. But you have lots of entrepreneurs trying to raise money at the low end and find that they can't get funding because of this mismatch. I think that there is an opportunity there. Money, Coins & Minting
People under-invest in family because it doesn't pay off until the long term. Families, Children & Parenting
People who have the drive to achieve spend most of their time on what brings them the most tangible, immediate sense of success. Investments in our family only pay off in the very long term. Time ;Success ;Families, Children & Parenting
Smart companies fail because they do everything right. They cater to high-profit-margin customers and ignore the low end of the market, where disruptive innovations emerge from.
The ability to share the gospel isn't a 'gift' that has been given to only a few Latter-day Saints and denied to the rest.
The basic idea that marketing is wrong at its core is one of the main reasons why innovation seems blocked and unpredictable.
The breakthrough innovations come when the tension is greatest and the resources are most limited. That's when people are actually a lot more open to rethinking the fundamental way they do business. Business, Commerce & Finance
The dumb-manager theory of business problems just didn't hold water for me. There had to be a deeper reason why smart people would make decisions that lead to failure. Failure ;Business, Commerce & Finance
The financial doctrines so zealously followed by American companies might help optimize capital when it is scarce. But capital is abundant. If we are to see our economy really grow, we need to encourage migratory capital to become productive capital - capital invested for the long-term in empowering innovations.
The first two lessons, which we learned early in our efforts to be good member missionaries, have made sharing the Gospel much easier: We simply can't predict who will or won't be interested in the Gospel, and building a friendship is not a prerequisite to inviting people to learn about the Gospel. Friendship
The iPod is a proprietary integrated product, although that is becoming quite modular. You can download your music from Amazon as easily as you can from iTunes. You also see modularity organized around the Android operating system that is growing much faster than the iPhone. So I worry that modularity will do its work on Apple. Music, Chants & Rapps ;Work, Workers & The Labor Force
The key is not to figure out what the best people are doing and try to emulate it - rather, figure out what causes people and companies to be successful.
The marginal cost of doing something 'just this once' always seems to be negligible, but the full cost will typically be much higher. Yet unconsciously, we will naturally employ the marginal-cost doctrine in our personal lives.
The mistake that makes launching a venture expensive is when you try to make a disruptive technology so good that it can compete on a quality basis with an established product. Science, Mathematics, Engineering & Technology
The only way all people can have the opportunity to choose or reject the gospel of Jesus Christ is for us, without judgment, to invite them to follow the Savior.
The paradox explored in my book 'The Innovator's Dilemma' is that successful companies can fail by making the 'right' decisions in the wrong situations.
The parents of teenagers would love to have a car that won't go very far or go very fast. They could just cruise around the neighborhood, drive it to school, see their friends, plug it in overnight. Love, Romance, Marriage & Sex
The path I am trying so hard to follow is in fact the one that God my Father and His Son Jesus Christ want me to pursue. It has brought me deep happiness. Religion & God ;Happiness & Unhappiness
The principles of disruptive innovation are indeed intended to be guidelines to assist managers both in introducing disruptive innovations as well as identifying disruptive developments in their market.
The process of writing 'The Innovator's Dilemma' entailed the developing a new theory. My colleagues, students and I have been improving that theory, and adding others to it, since that time. Time
The reason why it is so difficult for existing firms to capitalize on disruptive innovations is that their processes and their business model that make them good at the existing business actually make them bad at competing for the disruption. Business, Commerce & Finance
The Republicans are wrong in thinking that the rich create jobs. In reality, many of the richest Americans have been investing in efficiency innovations rather than to create jobs. And the Democrats are wrong, because growth won't happen if they distribute the wealth of the wealthy to everyone else.
The single most important factor in our long-term happiness is the relationships we have with our family and close friends. Happiness & Unhappiness ;Families, Children & Parenting
The way I ought to measure my life is in terms of the others I helped to become better and happier people. That's the biggest thing to think about if you're not happy. Life
The whole enterprise of teaching managers is steeped in the ethic of data-driven analytical support. The problem is, the data is only available about the past. So the way we've taught managers to make decisions and consultants to analyze problems condemns them to taking action when it's too late.
The world is a nested space, and so we have our brain as a person, and people are members of teams, and teams are part of business units, and business units are parts of corporations, and corporations are part of industries, which are part of economies. Business, Commerce & Finance
There are a lot of companies - not just Sony and Kodak - that have spent a lot of money trying to make the quality of the digital images comparable with film. But when you're sending these things over the Internet, they don't have to be high quality. Money, Coins & Minting
There are companies trying to build business within Saudi Arabia, and what they find is that if they try to bring on locals and teach them how to become senior executives, they just don't show up to work. They are not predictable as to when they'll come in and how much of their hearts are into that opportunity. Business, Commerce & Finance ;Work, Workers & The Labor Force
There are direct paths to a successful career. But there are plenty of indirect paths, too. So many young people I speak to nowadays think that the only way to get to such a career is by the direct path; but that really only makes sense in certain circumstances.
There are three types of innovations that affect jobs and capital: empowering innovations, sustaining innovations and efficiency innovations.
There is no evidence that success in business will make us happy people or allow us to have happy families. Success ;Business, Commerce & Finance
There is no single right answer or path forward, but there is one right way to frame the problem.
There just isn't anything more invigorating than to read an article or hear about an entrepreneur using the term 'disruptive technology' that makes no reference to me as the source. When it's clear they really got the idea and they use it as if it were in everyday parlance, that's the ultimate triumph. Science, Mathematics, Engineering & Technology
Things happen to us in unpredictable ways, but the effect that that has on the kind of people who we become actually is not only open to chance - we can influence it in pretty profound ways.
This is why I belong, and why I believe. I commend to all this same search for happiness and for the truth. Truth ;Happiness & Unhappiness
To become the kind of person you want to become, you've got to have discipline. It's easier to keep to your standards 100 percent of the time versus 98 percent of the time. Time
To focus capital and entrepreneurship into empowering innovation, we should change is the capital gains tax rate. We would be better served by a regressive tax rate, that would become progressively smaller the longer the investment is held.
Understanding motivation is one of the most important things we can do in our lives, because it has such a bearing on why we do the things we do and whether we enjoy them or not.
Universities think people come up with great ideas by closing the door. The academic tenure process, where you have to publish to journals which are very narrow, stands in the way of great research.
Venture capital is always wanting to go up market.
We all have jobs in our lives that we must get done. We reach out and bring products into our lives to get these jobs done. Marketing is all about asking, 'What job is the customer trying to accomplish?'
We are awash in content that needs to be taught, yet the vast majority of colleges give a large portion of their faculties' salaries to fund research.
We don't hire ministers or priests to teach and care for us. This forces us to teach and care for each other - and in my view, this is the core of Christian living as Christ taught it.
We have found that companies need to speak a common language because some of the suggested ways to harness disruptive innovation are seemingly counterintuitive. If companies don't have that common language, it is hard for them to come to consensus on a counterintuitive course of action.
We need to have a better balance between a deliberate strategy and staying open. Because in the end, most of us end up being successful in a career that we never imagined we would be in at the beginning.
We need to have an understanding of what causes what to happen in the world, and why.
What the purpose of my life is about is I want to become the kind of person that God wants me to become, and through my study of the scriptures, I can articulate the kind of person that God would be happy if I become. Life ;Religion & God
When a company identifies how to integrate the processes needed to give the consumer a sense of job completion, it can blow away the competition. A product is easy to copy, but experiences are very hard to replicate.
When an entrant competitor attacks the low end of any market, the rational reaction of the incumbent firms is to abandon rather than defend it - because the low end is the least profitable of their possible investments.
When considering a career move, consider the most important assumptions that have to prove true and how you can swiftly and inexpensively test if they are valid. Also, remain realistic about the path ahead of you.
When you improve your product so it does the customer's job better, then you gain market share.
When you're thinking about your next product or current product and wondering how to make it different so you don't have competition, understand the job the customer needs to get done.
Whenever we have thanked these men and women for what they have done for us, without exception they have expressed gratitude for having the chance to help - because they grew as they served. Women
While I wouldn't say that most entrepreneurs find it easy to get funding, there are certainly more people out there funding technology and healthcare companies than in other areas. Science, Mathematics, Engineering & Technology
You may hate gravity, but gravity doesn't care.