By Janelle M. Lewis, Principal Attorney, Law Office of Janelle M. Lewis.

There are two major takeaways from a recent article by BusinessInsider.com entitled, “A Harvard professor has a tip for entrepreneurs looking for the next big thing: Check out the electric-car market in China.”

Featured and renowned Professor at Harvard Business School, Clayton Christensen provides tips for entrepreneurs who are seeking the next big thing and directs them to check out the electric-car market in China. I am writing this article because I observed two major takeaways from the article that would benefit entrepreneurs who are seeking to be truly “disruptive innovators” and develop products or services that actually fall under the “market-creating innovation” category. The key to both these takeaways is that they really should be understood and then incorporated in the business strategy of entrepreneurs seeking disruption and market-creating innovation.

First Takeaway: Understand what it truly means to be have a “disruptive innovation”

The current article references a previous article that was written in 2015 by Christensen, along with Michael E. Raynor and Rory McDonald which the term “disruptive innovation” is defined and examined in depth. What they acknowledged in 2015 and again in this recent article is that the term has been reduced to a vague buzzword and it very much misunderstood. While entrepreneurs in various ecosystems, especially in startup ecosystems, like to describe themselves as “disruptive innovators,” the truth is very few are or at least haven’t yet become it because they simply do not understand what it means to be it.

While entrepreneurs in various ecosystems, especially in startup ecosystems, like to describe themselves as “disruptive innovators,” the truth is very few are or at least haven’t yet become it because they simply do not understand what it means to be it.

Keeping in mind that Christensen is credited with having popularized the term and idea, disruptive innovation has an actual definition and if used correctly, can help entrepreneurs strategize and becoming disruptive. Disruptive innovation is “the process through which a smaller company with fewer resources challenges an established business ‘by successfully targeting…overlooked segments, gaining a foothold by delivering more-suitable functionality – frequently at a lower price.” Resultantly, “the company moves upmarket and mainstream consumers start using the product or services.”

Disruptive innovation has an actual definition and if used correctly, can help entrepreneurs strategize and become disruptive.

In terms of business strategy, what entrepreneurs seeking to be disruptive innovators should take from the definition is to target segments of the market who would want to use a particular product or service but can’t do their lack of access to said product or service (usually because they cannot afford it).

Second Takeaway: Understand how to develop products or services that become market-creating innovations.

What entrepreneurs need to understand about creating a product or service that can be considered a market-creating innovation is that they have to be able to spot “would-be consumers who are unable to use a particular product either because it’s unaffordable or because it’s inaccessible.” The first thing this does is democratize a previously exclusive product or service. The end result (besides market traction for the entrepreneur) is that it enables the product or service to be more available to mainstream consumers, while creating a number of new local jobs.

What entrepreneurs need to understand about creating a product or service that can be considered a market-creating innovation is that they have to be able to spot “would-be consumers who are unable to use a particular product either because it’s unaffordable or because it’s inaccessible.”

In terms of business strategy, when seeking to have a product or service that is “market-creating innovation” entrepreneurs have to take into account not only how to make a particular exclusive product or service more inclusive, but how this demand will translate to the greater economy that they are operating in. In other words,  will they also create jobs in the communities that they are selling? In this capacity entrepreneurs are not only thinking about market traction but also job-creation, where the latter is equally important for the success of the actual product or service.

When seeking to have a product or service that is “market-creating innovation” entrepreneurs have to take into account not only how to make a particular exclusive product or service more inclusive, but how this demand will translate to the greater economy that they are operating in. In other words,  will they also create jobs…

For more information on how the Law Office of Janelle M. Lewis serves global entrepreneurs by merging the law, entrepreneurship, and innovation, please visit www.lawjmlewis.com or email jm@lawjmlewis.com.

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The views expressed in this article do not constitute legal advice and legal information provided in this post should not be relied upon as legal advice. Please contact an Attorney for advice on your specific matter.