A Harvard Professor who co-created disruption theory in 1995 has used it to determine that Uber – the company most cited as a model disruptor – doesn’t actually fit the definition of disruptive.
In an article in the December 2015 edition of the Harvard Business Review, business school professor Clayton Christensen rails against the popular perception of disruption theory.
“Many researchers, writers, and consultants use ‘disruptive innovation’ to describe any situation in which an industry is shaken up and previously successful incumbents stumble - but that’s much too broad a usage,” Christensen wrote, with co-authors Michael Raynor and Rory McDonald.
“Despite broad dissemination, the theory’s core concepts have been widely misunderstood and its basic tenets frequently misapplied.”
Nowhere is that misunderstanding more obvious than when talk inevitably turns to Uber.
It’s fairly impossible these days to hear a presentation on disruption where Uber is not provided as the most obvious and best example of the trend.
What might surprise disruption observers, however, is that Uber does not actually meet the criteria of disruption theory to be classified as a disruptor.
“Uber is clearly transforming the taxi business in the United States. But is it disrupting the taxi business? According to the theory, the answer is no,” the authors wrote.
“Uber’s financial and strategic achievements do not qualify the company as genuinely disruptive—although the company is almost always described that way.”
Without going into too much detail – you can read the full Harvard Business Review story here – Christensen and co note that disruption theory contains two tests for disruptors, and Uber fails both.
Christensen isn’t actually the first to write about why Uber might fail his theory.
A June 2014 article published by TriplePundit attempted to assess Uber against Christensen’s theory, also concluding it “doesn’t really pass”.
“While obviously Uber seems to meet the definition of disruptive innovation as most people understand this concept, it would be interesting to see if Uber actually meets the criteria for disruptive innovation defined by the person who actually coined and popularised the term – Prof. Clayton M. Christensen,” the report noted.
On the flipside, Bloomberg View columnist and former Harvard Business Review editorial director Justin Fox challenged Christensen’s right to a “monopoly” in defining what is and isn’t disruptive.
“OK, fine, Uber doesn't fit the very specific model of innovation that Christensen outlined first in his 1995 HBR article with Joseph L. Bower,” Fox opined.
“But the word [disruption] was around long before Clay Christensen. It’s a pretty good word, too, even though it surely gets overused these days.
“In any case, it isn't up to one business school professor to decide how it is used. Innovation just doesn’t work that way.”