Innovation and

Innovators
Dilemma
JUSTIN S. NAINABASTI

Innovation
Application of new knowledge to new
products, processes and services.

Variations In the Theory

Eric von Hippel (MIT) The Sources of Innovation (1988)

Lead user innovation: Describes a world in which new

generations of products seem to be emerging, not from
engineers and scientists who create them but from their most
demanding customers.

Eric von Hippel (MIT) Democratizing Innovation (2005)

User-centered innovation: Users and no longer simply a source of

ideas but are actively engaged in designing and creating
products that they need.

Innovators Dilemma
Traps that exist in following two long standing
business orthodoxies: working to your
established strengths and listening to your
customers.

Christensens Findings

Christensen developed his theory by looking at hard drive

industry

Noticed in several stages in the evolution of hard-drive

technology, leading manufacturer was displaces.

Dominant player often focused on the needs of existing

customers while new entrants were focused on emerging
customers with different needs.

Dilemma for existing firms: Do we deliver what our existing

customers want or do we shift gears and try to provide products
for new customers?