Soapbox: Is ‘disruptive innovation’ a theory gone off the tracks?

[grow_thumb image=”http://telecareaware.com/wp-content/uploads/2014/04/Thomas.jpg” thumb_width=”200″ /]Having publicly stood as a huge fan of Clayton Christensen’s theories of disruptive innovation, particularly the ‘broken circle of innovation’ as an explanation of our current economic stagnation (if not ‘stagflation’ which was a hallmark of my early adulthood and yes, now) and disruption in healthcare (even if it hasn’t started yet because it’s been sidetracked), this Editor was prepared to savage, demolish and otherwise lay waste to a New Yorker article by Jill Lepore (a Harvard professor of American History, for Pete’s sake).

Having read and digested the article, I am surprised in largely agreeing with Prof. Lepore. She brings forth certain weaknesses and concerns I had about the entire Weltanschauung of disruptive innovation, first as an overarching theory equivalent to Darwin’s theory of evolution. There is a veritable industry around disruptive innovation which she outlines, reminding me that hype of this type around any theory I find profoundly irritating because theories are just that–to be reality checked early and often, just like voting in the 1930s in Jersey City, New Jersey. Prof. Lepore then points out where fellow Harvard Prof. Christensen didn’t paint the complete picture (e.g. Bucyrus, US Steel) and–to me quite importantly–discounts external events and even aggressive, defensive business strategy (as Ron Hammerle’s Soapbox on sidetracked innovation pointed out). Many of Prof. Christensen’s acolytes ignore history (and business strategy) altogether in a near-religious form of Determinism-by-Innovation.

There is also another circle–a circular logic prevalent in Mr Christensen’s theories summarized aptly by Ms Lepore: (more…)

Soapbox: How healthcare disruption can be sidetracked

[grow_thumb image=”http://telecareaware.com/wp-content/uploads/2014/04/Thomas.jpg” thumb_width=”170″ /]Ron Hammerle’s comment on Disruptive innovation in healthcare hasn’t begun yet: Christensen (TTA 31 Mar), posted on LinkedIn’s Healthcare Innovation by Design group, made the excellent point that a potentially disruptive and decentralizing healthcare service–retail clinics–has been sidetracked, at least in the US, leaving an open question on their reason for being. This Editor thought it was worthy of a Soapbox. Mr. Hammerle knows of what he speaks because his Tampa, Florida-based company, Health Resources Ltd., works with retail and employer-based clinics to connect them via telemedicine/telehealth systems with medical centers.

When Clayton Christensen first anticipated that retail clinics would be disruptive to the established healthcare industry, their business model was potentially disruptive. What has subsequently happened, however, is a prime example of how potentially disruptive movements can be sidetracked.

After acquiring MinuteClinic and laying the foundation for taking retail clinics national, CVS Caremark chose to make deals with hospitals, which could easily afford to rent, open and operate such clinics without making money on the front end or facing real disruption. Retail clinics were a loss leader to hospitals in exchange for large, downstream revenues, and slightly-enhanced market share for the retailer’s pharmacy.

After CVS shocked Walgreens with one-two punches involving MinuteClinic and Caremark acquisitions, Walgreens came back with three counter-punches of its own:

1. They doubled the number of their clinics (to 700) in less than two years, thwarted AMA opposition, leapfrogged ahead of CVS in clinic count and totally changed the retail clinic model by setting up politically-invisible, broader service, make-your-profit-up-front, employer-based clinics. (more…)