Disruption talk: an analysis of disruption-related communication, strategies, and outcomes in S&P 500 firms

ABSTRACT

Disruptive innovation has attracted significant scholarly and managerial interest. In the existing research, there is ongoing debate about the nature of disruptive innovation and who initiates it. The related question of how incumbents can deal with disruption, let alone initiate it, has not been extensively addressed. To bridge these gaps, we conceptualised disruptive innovation as ‘a market outcome in which new offerings successfully challenge established ones in a given market’. This definition enables studying a wide range of disruptive strategies. We then analysed communication about disruptive innovation in the press releases of 101 S&P 500 firms between 2005 and 2014, along with the subsequent outcomes of those disruptive intentions until the end of 2019. The infrequency of references to disruptive innovation in the press releases seems to suggest that disruption is a rather rare issue for these firms. Nevertheless, a content analysis of press releases and secondary data suggests that large incumbent firms employ a number of distinct strategies to initiate disruption. While some of these strategies were not unexpected, others were more surprising and led in many cases to positive market outcomes. Our findings suggest that disruptive innovation is not necessarily a threat but may present many opportunities for established businesses.

Acknowledgements

We would like to thank Abayomi Baiyere from Copenhagen Business School and Benoit Gailly from UC Louvain for their useful comments on the previous versions of our study.

Disclosure statement

No potential conflict of interest was reported by the author(s).

Correction Statement

This article has been republished with minor changes. These changes do not impact the academic content of the article.

Notes

1 Tracing the success of a focal offering, though difficult, is much easier than tracing disruption, as the latter also involves looking at the market success and failure of competing offerings. Without the press release data, however, we would be even less confident that the positive or negative market outcomes reflect ‘true’ disruption. This may help to resolve the seeming disconnect between our big data-based analysis of the press releases to identify disruption ‘cases’ and the subsequent content analysis (see also Tidhar and Eisenhardt, 2020).

Additional information

Notes on contributors

Paavo Ritala

Paavo Ritala is a Professor of Strategy and Innovation at the School of Business and Management at LUT University, Finland. His main research themes include collaborative innovation, digital strategy, ecosystems and platforms, coopetition, and sustainable value creation. His research has been published in journals such as Journal of Management, Research Policy, Journal of Product Innovation Management, Long Range Planning, Industrial and Corporate Change, and California Management Review. He is closely involved with business practice through company-funded research projects, executive and professional education programs, and in speaker and advisory roles. Prof. Ritala is the incoming Co-Editor-in-Chief of R&D Management and he serves in the editorial board of Journal of Product Innovation Management.

Pontus Huotari

Pontus Huotari is a post-doctoral researcher at the School of Business and Management at LUT University, Finland. His research focuses on firm strategies in the digital economy, particularly in the context of platform-based markets or ecosystems. He also specializes in programming-based “big data” research methods. His research has been published in journals such as Technological Forecasting and Social Change and Journal of Business Research.

Kateryna Kryzhanivska

Kateryna Kryzhanivska is a Junior Researcher at the School of Business and Management at LUT University. She is doing research about new forms of organizing cross-boundary collaboration in teams, open innovation, innovation ecosystems, and digitalization in regional innovation networks. She is interested in particular in the process of temporary organizing work in teams across organizations and how it is shaped through digital technologies, such as digital community platforms or digital networks of experts. Her background is a MSc degree in Technology-oriented Management from TU Braunschweig, Germany. Additionally, she holds a qualification in Management in Central and Eastern Europe from Vienna University of Economics and Business, Austria. Within gathered professional experience in the automotive industry and consulting, she has contributed to the development of organizational and product strategies of companies, driven by innovation. Combined with strong academic skills, she wishes to gain a research- and practice-oriented PhD in the future.