What exactly is disruptive innovation? there are many ways to describe this term but Professor Klaitan from the video tells us that Disruptive innovation is not just a breakthrough innovation, in fact it innovates a product that is historically so expensive and make it affordable to the common mass.

lets look at a specific industry to understand this definition better. lets look at the innovation that has been happening in the automobile industry! 20-30 years before, cars were just targeted to the upper class section of the society. The most interesting question is, why? It is so due to the high cost of production. The car manufacturer used to not be able to enjoy economies of scale and as a result, the production cost for each car was relatively high. However, now days, we see that cars is “almost” targeted to everyone. This claim just means that, we can at least see one car in each family. Again, why so? This is because of the disruptive innovation that has been going on in the automobile industry. The production cost of each car has relatively gone down due to the new sophisticated technology used to manufactured these cars.

To conclude, disruptive innovation has indeed brought a major change to the human life’s, especially in making goods more affordable to the common mass. On the other hand, it has led to a downfall to certain industries and caused massive structural unemployment in those industries. Hence, the extent to which disruptive innovation is encouraged should be considered.