Practice question · Multiple choice
A market leader listens carefully to its best customers and is destroyed by a cheaper, initially worse technology. Christensen called this the innovator's dilemma. Why is it a dilemma rather than a mistake?
Hints
- Ask what the leader's best customers said they wanted, and whether listening was wrong.
- A dilemma means both horns hurt. What was the cost of pursuing the disruptive product?
Show the answer
C. Because the correct decisions are what blocked the disruption
Why
Serving your most profitable customers and rejecting a low-margin, worse product is textbook good management, and it is exactly the trap, which is why the incumbent's competence is the mechanism rather than its complacency. Christensen's remedy is structural: a separate unit whose customers are the new market's.
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