Digital Business Strategy: Internal and external analysis and disruptive innovation
Select one technology company (Apple, Microsoft, Samsung, AT&T, Facebook, Alibaba or Cisco Systems) and identify its internal and external analysis, addressing the factors described by McKeown and Durkin in The Seven Principles of Digital Business Strategy (pp. 19–26).
Assignment (no more than 350 words): disruptive innovations make products and services accessible and affordable. What are three products or services you use (other than computers or cell phones) that are disruptive innovations, and why?
Netflix versus video rental stores
Walk-in care versus physician offices
Low-cost learning versus traditional classes
Model response
Original example for study purposes (about 250 words, within the 350-word limit). Replace the examples with services you actually use, and add your company analysis using McKeown and Durkin if your instructor requires it.
Disruptive innovations begin by serving customers who are overlooked or overserved by established firms, offering simpler and more affordable products that later improve enough to attract mainstream customers (Christensen et al., 2015). Three services I use fit this pattern.
1. Streaming video (Netflix). Netflix began with DVD-by-mail, a service that appealed to customers who disliked late fees and trips to rental stores but that Blockbuster considered a small niche. As internet speeds improved, Netflix shifted to streaming, offering unlimited content for a low monthly fee on many devices. It eventually displaced video rental stores and changed how television is produced and watched.
2. Retail health clinics. Walk-in clinics in pharmacies, such as CVS MinuteClinic, provide basic care like vaccinations, strep tests and minor illness treatment at lower cost and with no appointment. They started with simple, routine needs that physician offices served expensively and inconveniently, making care more accessible for busy or uninsured people. As they add services and telehealth, they compete more directly with traditional primary care.
3. Online learning platforms. Platforms such as Khan Academy and Coursera offer free or low-cost courses that anyone with internet access can take at their own pace. At first, traditional universities viewed them as lower quality, but they reached learners who could not afford or access college. Today, many offer certificates and degrees, challenging the traditional higher education model.
All three made a valuable service cheaper and more accessible, improved over time and pressured established providers to change.
References
Christensen, C. M., Raynor, M. E., & McDonald, R. (2015). What is disruptive innovation? Harvard Business Review, 93(12), 44–53.
McKeown, N., & Durkin, M. (2017). The seven principles of digital business strategy. Business Expert Press.
Company analysis tip: if your instructor also wants the internal and external analysis of a company, use McKeown and Durkin’s factors to organize strengths and resources (internal) and market, competitive and technological forces (external) for the company you choose.
Frequently asked questions
Is Uber a disruptive innovation?
Christensen and colleagues argued that Uber is not a classic disruptive innovation because it did not start in a low-end or new market; it launched as a better, convenient alternative for existing taxi customers.
What is the difference between disruptive and sustaining innovation?
Sustaining innovations improve products for existing customers; disruptive innovations start with simpler, cheaper offerings for overlooked customers and later move upmarket.
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