6.7 Disruptive Innovation by William Abernathy

Marcos Antonio de Lima Filho, PhD.

The concept of disruptive innovation has gained significant attention and prominence since the publication of Clayton Christensen’s influential work, The Innovator’s Dilemma, in 1997. However, Christensen’s binary categorisation of innovations into either sustaining or disruptive has been met with criticism and several inconsistencies. Abernathy’s framework, developed long before Christensen’s theory, presents a multidimensional perspective on innovation and avoids the limitations of a binary classification. This allows for a more explanatory assessment of innovations such as the iPhone and the Jet Age, which Christensen’s model struggles to explain. In light of these difficulties, it might be beneficial for scholars and practitioners to revisit Abernathy’s concept of disruption, as it could serve as a springboard for a new paradigm of disruptive innovation theory.

Before Christensen, the concept of disruption was not characterised in terms of intersecting performance trajectories. His forerunners did not make assumptions about incumbents improving along an innovation trajectory, the pace of innovation exceeding customer needs, or disruptive technologies initially underperforming established technologies in mainstream markets. These assumptions formed the basis of Christensen’s theory, which led him to divide innovations into two distinct categories: sustaining and disruptive. However, it is essential to consider that innovation may be a far more complex phenomenon than what can be captured by a binary dichotomy of sustaining versus disruptive innovation.

Innovation scholars have raised concerns about Christensen’s definition of disruption for quite some time, with critiques emerging as early as 2001: “I believe this definition is too narrow, thereby limiting our understanding of technology change” (Acee, 2001, p. 51). Christensen also confined his theory to lower-cost, lower-performing innovations that appeal to a new subset of users (Weeks, 2015), which is another problematic assumption. The premise of low-end disruptions is implicated in a series of failed predictions, such as Christensen’s prediction that the iPhone would not succeed (Section 6.3), and the disruption of Boeing and Airbus by regional jet manufacturers (Sections 6.8 and 6.9).

By emphasising only “attack from below” or “low-end disruptions”, Christensen ignored other discontinuous patterns of change, which may be of equal or greater importance (Utterback & Acee, 2005). Furthermore, the exclusion of high-end disruptions rendered his model potentially dangerous. His definition might lead managers to overlook a different type of disruption: one that emerges not at the bottom of the market but at the top (Carr, 2005). Michael Porter also advocated for a broader definition of disruption. In an interview with Joan Magretta, the Harvard School Professor highlighted the importance of considering a wider range of disruptive forces, rather than limiting the scope of disruption to Christensen’s narrow framework:

But other forms of disruption play a role in strategy. The threat can come from above. You can have an advanced technology or a richer approach that performs at a high level but that can be simplified or streamlined to meet less sophisticated needs at much lower cost. We don’t have good evidence on which form is most prevalent, but both exist (Magretta, 2012).

The fact that Christensen’s theory of disruption has remained essentially unchanged, despite numerous criticisms and anomalies, raises concerns. In my view, the research led by Christensen on disruption can be characterised as incremental at best, serving to support and legitimate his theory, rather than correcting its shortcomings. The sustaining vs. disruptive dichotomy, which lies at the heart of the theory, persists even though it may not fully encapsulate the complexity of innovation. Moreover, the definition of disruption remains narrow, while the concept of high-end disruptions is dismissed entirely.

Christensen remained resolute in the face of contradictory cases like Apple and Tesla, asserting that these high-end cases are not instances of disruption since they stem from the upper-end of the market (Zuckerman, 2016). Instead of revisions, he advised that new theories could be developed to explain such cases: “We do not preclude the possibility that future research could develop new theory to account for these phenomena” (Christensen et al., 2018).

Instead of developing a “new theory”, I propose that it would be more advantageous to reform disruptive innovation theory by reconnecting with its rich research tradition, allowing for the incorporation of valuable but forgotten contributions. This approach could also reestablish the connections between disruptive innovation and evolutionary theory. Early innovation scholars were notably inspired by various punctuated models, including Kuhn’s Structure of Scientific Revolutions, Schumpeter’s creative destruction, and Gould’s theory of punctuated evolution:

Kuhn’s The Structure of Scientific Revolutions suggests that the advancement of science is characterised by long periods of regular development, punctuated by periods of revolution. Historical evidence suggests that a similar pattern characterises the development of technology (Abernathy & Clark, 1985).

Drawing from this concept, Abernathy recognised that industries similarly undergo phases of relative stability, interrupted by disruptive innovations that lead to significant transformations. These punctuated models led him to conceptualise disruptive innovation as follows:

(…) we have defined as “conservative” innovations whose effect is to extend or refine existing design concepts or production systems; and as “disruptive” those innovations whose effect is to destroy such concepts or systems (Abernathy et al., 1983, p. 97).

By its very nature, epochal or disruptive innovation makes obsolete existing capital equipment, labor skills, materials, components, management expertise, and organisational capabilities. It destroys the value of present competence in various aspects of production and may alter the relative positions of competitors, attract new entrants into an industry, or even redraw an industry's competitive boundaries (Abernathy et al., 1983, p. 28).

In contrast to the sustaining-disruptive dichotomy, Abernathy offers a more nuanced and comprehensive perspective on disruption. Abernathy envisions disruptive innovations as a spectrum, capturing the diverse levels of disruptive impact across two key domains:

• In the technological domain, innovations can either disrupt existing competence or, at the other extreme, conserve it.

• Within the market domain, innovations can create or disrupt existing markets, while on the opposite end of the spectrum, they can preserve existing market connections.

As such, Abernathy proposed that the disruptiveness of a given innovation can be assessed along two primary domains: its effects on technology (Table 6.7.1) and its effects on markets (Table 6.7.2). In each domain, the range is defined by polar extremes, the one conservative, the other radical:

On the conservative end of the scale are those innovations that serve to enhance the value or applicability of the firm’s existing competence. Clearly, all technological innovation imposes change of some kind, but change need not be destructive (…) On the radical end of the scale, the effect of innovation is quite the opposite. Instead of enhancing and strengthening, innovation of this sort disrupts and destroys (Abernathy & Clark, 1985).

The technological domain covers aspects such as design, production systems, skills, materials, and capital equipment. Innovations within this domain can either strengthen existing competencies or introduce disruptive, radical changes. Under this framework, a disruptive innovation transforms the foundation of a service, product, or production process to such an extent that existing resources, skills, and knowledge face challenges in meeting new requirements or fail completely. Consequently, the value of current competence is diminished, and in extreme cases, rendered obsolete (Abernathy & Clark, 1985).

“This kind of change”, concludes Abernathy and Clark (1985), “is at the heart of Schumpeter’s theory of innovation and economic development in which ‘creative destruction’ is the vehicle of growth”. Joseph Schumpeter argued that waves of “creative destruction” were a vital part of any economy because they washed away businesses with obsolete capabilities (King & Baatartogtokh, 2015). The concept of disruption is, hence, largely consonant with Schumpeter’s concept of creative destruction, whereby the old is incessantly destroyed or replaced by the new (Kim & Mauborgne, 2015).

Therefore, it is safe to say that the concepts of disruptive innovation as proposed by Christensen and Abernathy present striking differences. Christensen’s disruption paradigm diverges significantly from its predecessors, limiting disruption to a narrow range of circumstances and mechanisms. In contrast, Abernathy conceptualised disruptive innovation as a more expansive phenomenon that drives change, knowledge creation, destruction, and industrial renaissance. Disruptive innovations play a key role in this process of industrial evolution, since they can lead to “the creation of new industries as well as the reformation of old ones” (Abernathy & Clark, 1985). A key difference between the two theories is Abernathy’s definition of innovation disruptiveness as a continuum rather than a binary dichotomy. By examining the impacts of an innovation on both technological and market domains, Abernathy’s approach allows for a more accurate evaluation of the degree of disruption caused by cases like the iPhone and the Jet Age. Christensen and his followers, on the other hand, have expressly denied that such cases qualify as disruptive innovations, instead labelling them as sustaining innovations. Accordingly, Tesla Motors (Christensen et al., 2015), the iPhone (McGregor, 2007; Christensen et al., 2015), and Airbus (Christensen et al., 2004) have all followed a “sustaining innovation strategy”.

This debate goes beyond mere definitional disagreements, as the two perspectives on disruption can lead to significant differences in how practitioners interpret market events and anticipate the evolution of industries. For instance, while Christensen argued time and again that Tesla was following a sustaining innovation strategy (Christensen et al., 2015; Iyer, 2018), Abernathy left no doubts that the electrification of vehicles would disrupt the automobile industry. In his 1983 book, Abernathy foresaw the disruptive consequences of electric vehicles, even though they were decades away from becoming commercially available:

If the incentives for innovation persist, for example, the whole fuel and energy conversion logic of the automobile may change. Gasoline and diesel-based combustion systems have dominated the industry for the better part of the century, but enhanced battery technology and better mastery of chemical processes could make an electric-powered car feasible. (…) It takes no great leap of the imagination to see the truly revolutionary effect such a shift in core concepts would have on all aspects of manufacturing and market linkage. Once set in motion, so fundamental an upheaval in long-established design hierarchies would keep the ferment of de-maturity alive to the end of the century and beyond (Abernathy et al., 1983, p. 118).

Once again, this contradiction appears to undermine the premise of low-end disruption that underpins the current disruption dogma. Christensen’s emphasis on low-end disruptions prevented him from recognising Tesla’s disruptive high-end approach, leading him to assert that Tesla was not an example of disruptive innovation, and that considering the company a special case of high-end disruption would be a “misinterpretation” of his theory (Christensen et al., 2015). In contrast, neither Abernathy or any of the early innovation scholars from the 1980s and 1990s have made such distinctions. For them, disruptions could are arise either from low-, mid- or high-end segments, highlighting the need for a critical evaluation of this problematic assumption.

In conclusion, Abernathy’s framework highlights the diverse and nuanced ways in which innovations can impact both the technological and market aspects of a firm. By considering a broad spectrum of potential effects, this approach offers a more comprehensive understanding of disruption than the simplistic binary categorisation of sustaining vs. disruptive innovation. As such, Abernathy’s concept of disruption may serve as a foundation for a new paradigm in disruptive innovation theory. The inability of the current disruption theory to explain certain anomalies, which the previous paradigm had no issues with, indicates a potential loss of explanatory power. Therefore, efforts should be made to recover these lost insights.