Catalytic Innovation

Disruptive Innovation for Social Change.
By: Christensen, Clayton M., Baumann, Heiner, Ruggles, Rudy, Sadtler, Thomas M., Harvard Business Review,
Dec 2006, Vol. 84, Issue 12

To understand the argument in this article, it's useful to review the disruptive-innovation model first put forward in Christensen and Joseph L. Bower's HBR article "Disruptive Technologies: Catching the Wave" (January–February 1995).

The authors divide innovations into two categories: sustaining and disruptive.

Most product and service innovations are sustaining. They provide better quality or additional functionality for an organization's most demanding customers. Some sustaining innovations are incremental improvements; others are breakthrough or leapfrog products or services.

By contrast, disruptive innovations may lack certain features or capabilities of the established goods. However, they are typically simpler, more convenient, and less expensive, so they appeal to new or less-demanding customers.

Disruptive innovations have had a major impact on industry structures, from travel to computer retailing to communications, and have often given rise to social change in the process. But the social changes caused by disruptive innovations are largely unintended; they are simply the by-products of pursuing a business opportunity. With catalytic innovations, however, social change is the primary
objective.


Catalytic innovations are disruptive innovations with social change as the primary
objective.

It will bring new benefits to a large section of people.

It's fairly easy to grasp the disruptive-innovation model when it's applied to commercial products and services. But how, exactly, does the model work in the social sector? Catalytic innovators share five qualities:

1. They create systemic social change through scaling and replication.
2. They meet a need that is either overserved (because the existing solution is more complex than many people require) or not served at all.
3. They offer products and services that are simpler and less costly than existing alternatives and may be perceived as having a lower level of performance, but users consider them to be good enough.
4. They generate resources, such as donations, grants, volunteer manpower, or intellectual capital, in ways that are initially unattractive to incumbent competitors.
5. They are often ignored, disparaged, or even encouraged by existing players for whom the business model is unprofitable or otherwise unattractive and who therefore avoid or retreat from the market segment.


Authors

Clayton M. Christensen (cchristensen@hbs.edu) is the Robert and Jane Cizik Professor of Business Administration at Harvard Business School in Boston.

Heiner Baumann (heiner_baumann@newprofit.com) is the chief knowledge officer and a partner at New Profit, a Cambridge, Massachusetts–based venture philanthropy fund that provides financial and strategic support for social entrepreneurs.

Rudy Ruggles (rudy.ruggles@comcast.net) is the president of Weston, Massachusetts–based Collaborative Innovation Services, a consulting firm that works with organizations to create solutions to social and environmental challenges.

Thomas M. Sadtler (tom.sadtler@post.harvard.edu) is the vice president of professional services marketing at CA, a management software company based in Islandia, New York, and a New Profit thought partner.