How should management typically respond to disruptive innovations?

How should management typically respond to disruptive innovations?

• A. Decide resource allocation to balance sustaining improvements with exploring new markets.
• B. Ignore disruptive ideas and double down on existing products.
• C. Abandon existing customers to chase new ones.
• D. Fund only incremental improvements in a single product line.

Answer: (A)

Disruptive innovations require balancing what you already do well with the need to explore new opportunities. The best approach is to allocate resources so you can continue improving current products for existing customers while also funding experiments, new markets, and potentially separate ventures that can develop new business models. This ambidextrous stance helps you defend the core business against disruption while not missing opportunities that could redefine the market. Ignoring disruptive ideas or doubling down on existing products risks being displaced as the new approach proves superior. Abandoning core customers isn't sensible because they still fund your current business, and focusing only on incremental improvements in one product line limits the ability to adapt. By spreading attention and investment across both exploitation and exploration, you stay competitive over time.

Disruptive innovations require balancing what you already do well with the need to explore new opportunities. The best approach is to allocate resources so you can continue improving current products for existing customers while also funding experiments, new markets, and potentially separate ventures that can develop new business models. This ambidextrous stance helps you defend the core business against disruption while not missing opportunities that could redefine the market.

Ignoring disruptive ideas or doubling down on existing products risks being displaced as the new approach proves superior. Abandoning core customers isn't sensible because they still fund your current business, and focusing only on incremental improvements in one product line limits the ability to adapt. By spreading attention and investment across both exploitation and exploration, you stay competitive over time.