When Business Theories Go Bad

jill leporeI’m a fan of New Yorker staff writer Jill Lepore, whose previous article on the History of Debt in the US was totally fascinating.

In a recent New Yorker article, she takes down the much admired theory of Harvard Business School ‘disruption’ guru Clayton Christensen. Christensen argues that companies that make incremental improvements to their products inevitably get ‘disrupted’ into oblivion by radical innovators. It’s the kind of zeitgeist-capturing idea that has taken hold of the business world, in an age of unforseen terrorist attacks, black swan financial events, and the zero-to-billionaire-in-18-months companies of Silicon Valley.

A cottage industry of ‘Disruption’ conferences, consultants, books, and speaking engagements has sprung from Christensen’s work.

Unfortunately, as Lepore shows in her article, the disruption theory just doesn’t happen to be true, or supported by any real evidence whatsoever.

Have you ever wondered whether these business gurus just invent cool-sounding theories that match the national mood?

Me too, I just never saw it presented so devastatingly as in Lepore’s New Yorker article.

I also just learned from Lepore’s bio that she recently became a Harvard professor. Those chance meetings between Lepore and Christensen at the faculty club are probably pretty frosty these days.

disruptingclassI also sounds like I can skip buying this book on ‘Disrupting Class.’



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I founded Bankers Anonymous because, as a recovering banker, I believe that the gap between the financial world as I know it and the public discourse about finance is more than just a problem for a family trying to balance their checkbook, or politicians trying to score points over next year’s budget – it is a weakness of our civil society. For reals. It’s also really fun for me.

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