> A disruptive innovation occurs when long-standing assumptions in a marketplace are tested and successfully challenged by upstarts.<p>A disruption innovation is a new way of doing things, often based on technology (but can be a different business model), that at first is not good enough for mainstream users. So it is no threat to incumbents, and no competitive response is provoked. But it is good enough for some other users and usages, and it can gradually improve in this safe backwater... until one day, it is good enough for mainstream users - but it also has some other benefits (that appealed to those other users), and so, suddenly, they switch. This is a disruption.<p>The difficulty for incumbents is that (up til then), their customers didn't want it. They might even have tried to force it on their customers, but with no response. Because good management will listen to customers, and try to serve them, it makes it even harder for them to deal with approaching disruptions, even if they see them clearly.<p>Another problem is that while incumbents may keep on improving their product (so it is still clearly, overwhelmingly superior to the disruption), the key to the effect is that their product has become more than good enough. So it doesn't matter that it's better it's like offering ever more water to a man who was thirsty, but is now full.<p>Note that there are many parts to this scenario, and a candidate innovation might fall down at many points - it might not be possible to improve it enough for mainstream users; there might be a way for incumbents to co-opt it; a great company can sometimes disrupt themselves (cannibalizing their own sales); yet another disruption might improve enough before this one did, etc.<p>Two big take-homes for me:<p>- to be aware of what people want, not just making better widgets.<p>- making a product that some people want, but that is not yet perfect and not yet ideal for them, is a <i>good</i> thing.