What makes a disruptive technology successful?

According to Hardman et al, disruptive technologies share particular characteristics and these include being disruptive to market leaders, end users and infrastructure.

In their paper, Hardman et al identify seven characteristics of disruptive innovations. They use a three-point criteria derived from these characteristics and based on historical successful disruptive technologies to identify if a technology is or has the potential to be successful.

This creates a foundation from which to identify pathways to greater market penetration.

Seven characteristics of successful disruptive technologies

1. The threat of the new technology is not often recognised by existing market leaders.
2. Disruptive technologies are initially more expensive than the incumbent technologies.
3. Often, the quality of the disruptive technology is initially worse than the quality of the technology it seeks to replace.
4. The technologies have some form of desirable ‘added value’ to the consumer.
5. Disruptive technologies fill niche markets first, before spreading to other niches and eventually reaching the mass market, where they then become most disruptive.
6. The incumbent technology is never wiped out all together. It in turn becomes a technology for niche market applications.
7. Socio-technical systems are ever-evolving. Incumbent technologies will be replaced by disruptive ones, and the disruptive ones will eventually become incumbent, which, in turn, will be made redundant by a new technology in the future.

These seven characteristics are not exclusive and not all successful disruptive technologies have these characteristics.

However, from these seven, the authors derive 3 fundamental characteristics, which, according to them, are always present in disruptive technologies and are exclusive to disruptive technologies. These form the three-point disruptive technology criteria, and barring the odd exception a disruptive technology will meet at least two of these three criteria.

The three-point disruptive technology criteria are:

1. Disruptive to market leaders: the manufacturers of the disruptive technology are different companies to those producing the incumbent technologies.
2. Disruptive to end users: disruptive technologies change the way in which the technologies are used.
3. Disruptive to infrastructure: the disruptive technology requires different infrastructure to the incumbent technology and/or negatively affects existing infrastructure.

The authors explain that these criteria can be used to assess whether a technology that is at the point of market penetration is disruptive to the current market. Importantly, the criteria can also be used to predict whether a new technology has the potential to become a disruptive technology.

The successful use of the three-point criteria requires information regarding both the incumbent and the potential disruptor.

For example, for the incumbent, there is the need to establish:

– who the market leaders are in the disruptor’s target market
– how the technology is used
– what infrastructure the technology has associated with it.

For the disruptor, it is important to understand:

– who is producing the technology
– how the technology will be used
– how it performs better than the incumbent
– the nature of the infrastructure the disruptor will require to support its market entry.

Hardman et al note that if a technology is found to meet only one of the criteria it is likely to be a sustaining technology that will not cause disruption the status quo.

The full version of this paper can be found at http://www.sciencedirect.com/science/article/pii/S0360319913023112  (Disruptive innovations: the case for hydrogen fuel cells and battery electric vehicles, International Journal of Hydrogen Energy 38 (2013) 15438 – 15451, Hardman et al (2013))

Written by Dr Imoh Ilevbare for R&D Today
Product Manager (Innovation and Technology Management Services) at Institute for Manufacturing, University of Cambridge