An Incompetent Attack on the Innovator's Dilemma

Jill Lepore distorts and misunderstands one of the best business books ever written.
This man is not a cult leader.

Let's allow that many if not most books on management are garbage, that many if not most management gurus are hucksters, that worship of mere novelty is a debased philosophy of life, and that "creative destruction," as Joseph Schumpeter called it, is a mixed blessing. On all these points, I'd be inclined to take sides with the historian Jill Lepore against the cult of "disruptive innovation."

Yet I find her attack in the New Yorker on Clayton Christensen, author of "The Innovator's Dilemma," first published in 1997 and still widely read, both mean-spirited and (for a scholar of her distinction) surprisingly incompetent.

The main target of Lepore's essay isn't really Christensen or his famous book at all, but the ideas they supposedly stand for. In particular, what she calls "faith in disruption":

The idea of innovation is the idea of progress stripped of the aspirations of the Enlightenment, scrubbed clean of the horrors of the twentieth century, and relieved of its critics. Disruptive innovation goes further, holding out the hope of salvation against the very damnation it describes: disrupt, and you will be saved.

That's an overwrought caricature of even the most incautious champions of "innovate or die" -- never mind of Christensen and his book. He doesn't come close to expressing that worldview. By manner and temperament, he's ridiculously miscast as the cult leader Lepore wants him to be. A modest, open-minded, plain-spoken man, he's receptive to criticism and sees his research as work in progress. "The Innovator's Dilemma" reflects those virtues. Christensen's a smart, thoughtful guy, and "The Innovator's Dilemma" is an unusually smart, thoughtful book.

Its basic argument was that there are two main kinds of innovation -- "sustaining" and "disruptive." The first is concerned with improving products in ways that a firm's current customers find valuable. Disruptive innovations, in contrast, usually perform poorly in that respect -- while creating, nonetheless, the possibility of new products and new customers. Such innovations arrive quietly and start from behind, yet have the power to transform. The dilemma of the book's title arises because to be good at the first kind of innovation, firms develop a "stay close to customers" culture that discourages the other kind.

The idea was instantly compelling. One thinks now of the Eastman Kodak Co. and digital photography, say, or of print and digital journalism. "The Innovator's Dilemma" illustrates it with other case studies -- mainly of the disk-drive industry, the mechanical-excavator industry and discount retailing. Lepore disapproves of the very method: Case studies are no way to prove a theory, she says. (Historians, please note.) Also, Christensen chose bad examples and then got the histories wrong.

This part of Lepore's essay isn't just weak; it often seems deliberately misleading. For example, she slaps Christensen down for regarding the disk-drive industry as representative, even as he says it's unique.

"Nowhere in the history of business has there been an industry like disk drives," Christensen writes, which makes it a very odd choice for an investigation designed to create a model for understanding other industries.

In fact, Christensen explains why the disk-drive case was especially worth studying. Geneticists, he says, study fruit flies because the insects' life-cycles are so short -- and disk-drive manufacturing was the closest thing in business to fruit flies. As he writes:

Indeed, nowhere in the history of business has there been an industry like disk drives, where changes in technology, market structure, global scope, and vertical integration have been so pervasive, rapid, and unrelenting. While this pace and complexity might be a nightmare for managers, [it is] fertile ground for research. Few industries offer researchers the same opportunities for developing theories about how different types of change cause certain types of firms to succeed or fail or for testing those theories as the industry repeats its cycles of change.

Continuing to ignore or distort what Christensen said, Lepore rebukes him for treating particular firms as incumbents one minute and new entrants the next, as though that is self-contradictory. Again, Christensen is aware of the issue and emphasizes it. Which firms are "established" and which are "entrants" is defined for each particular technology and a certain stage in its history, he notes. So, yes, over time and across the full range of products, any given firm can be both entrant and incumbent.

The idea of disruptive innovation is not predictive, Lepore says: The future is unreadable. Christensen agrees, at least, that prediction is very hard. "In many instances the information required to make large and decisive investments in the face of disruptive technology simply does not exist." His theory, she says, is transfixed by change and blind to continuity. Really? "The evidence is quite strong," he says, "that companies whose strategy is to extend the performance of conventional technologies through consistent incremental improvements do about as well as companies whose strategy is to take big, industry-leading technological leaps." In other words, it's unwise to resolve to always be a leader.

These points, though, are secondary to Lepore's real concern, which is the post-Christensen cult of disruption. Well, perhaps it does need saying that disruption can be a bad thing; that there's more to human progress than coming up with new stuff; that schools, hospitals, churches and museums aren't factories; and that, as Lepore reminds us, "People aren't disk drives." Perhaps readers of the New Yorker are especially susceptible to such misconceptions. What perplexes me is the suggestion that Christensen would disagree with her about any of this.

As well as making Christensen the standard-bearer for a worldview he doesn't endorse, and misrepresenting arguments he advances in his book, Lepore completely misses what was most arresting in "The Innovator's Dilemma" -- and, I'd suggest, the reason for its great success. The book wasn't a hit because it preached a gospel of innovation or of salvation through disruption. It succeeded because it did justice to the title's key word: "dilemma."

The insight that firms may fail by listening to their customers and doing what they are best at was true, instantly plausible and shocking. The further idea that there's no simple remedy -- not because firms are stupid or lazy but because the trade-offs are so hard to strike -- resonates powerfully with managers. In industry after industry, they face exactly the dilemma that Christensen described. And almost 20 years later, his book is probably still the best guide to thinking more intelligently about it.

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