Managing Innovation: Disruptive Innovation Theory and Future Trends

This report delves into the concept of disruptive innovation theory and its practical application within the context of Terracycle, a private recycling business. The report begins with an introduction to managing innovation and then proceeds to define and explain disruptive innovation theory, outlining its core principles and strategic importance in the modern business environment. The main body of the report provides a detailed analysis of the theory, including its benefits and limitations. The report then applies the theory to Terracycle, examining its historical development and potential future scenarios. The analysis includes a discussion of Terracycle's business model and how it can leverage disruptive innovation to maintain a competitive advantage. The report concludes with a summary of key findings and recommendations, emphasizing the importance of understanding and adapting to disruptive innovation to achieve long-term success in the marketplace. The report also makes use of the Business Canvas Model to analyze Terracycle's key activities, resources, partnerships, customer relationships, value proposition, customer segments, channels, cost structure, and revenue streams. The report uses the case of Terracycle to highlight how disruptive innovation can be used to create value, capture market share, and drive growth, while also providing an overview of how the theory can be implemented by businesses.

Managing Innovation
Assessment

Table of Contents
INTRODUCTION ..........................................................................................................................2
MAIN BODY...................................................................................................................................2
Disruptive Innovation Theory.....................................................................................................2
Application of the Disruptive Innovation Theory in the historical development context...........6
Application of the Disruptive Innovation Theory in the future development context................8
CONCLUSION..............................................................................................................................10
REFERENCES..............................................................................................................................11
APPENDIX....................................................................................................................................12
Disruptive innovation theory....................................................................................................12
Applied Disruptive innovation theory.......................................................................................12
Business Canvas Model............................................................................................................13
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INTRODUCTION
Managing innovation is refers to the process of handling all the activities that required to
introduce something innovative within the company. Mainly, it is combination of management of
innovation process that help company in improving their performance and at the same time also
developing its competitive image at market place (Au and Tucker, 2018). One of the main
advantages of managing innovation is to capturing larger market share by serving quality
products and services. Current project is based on Terracycle, is a private recycling business
operate their business in Trenton. It run a volunteer-based recycling platform that focus on
collecting non-recyclable pre consumer and post-consumer waste. In this relation company use
various theories to develop their brand image at market place. The report tends to cover suitable
discussion on the disruptive innovation theory considering the effective understanding and its
concept which is concerned with the prominent benefit and limitations to the company. Along
with this, the theory is applied on the historical and future in terms of Terracycle.
MAIN BODY
Disruptive Innovation Theory
Disruptive innovation theory is an effective strategy that refers to the simultaneous
pursuit of bringing new product within the market considering the effective and suitable
presence. One of the main purposes of using this type of strategy is to creating as well as
capturing market space. With the assistance of this, company can attain competitive advantage
over the competitors by serving innovative products and services in new market. In addition to
this, it is also revolving around searching a place where in very less firms are operating and there
is no pricing pressure.
As per current business environment, most of companies are operate their business under
intense competition and at the same time also tries put their efforts for attainment of larger
market share. The primary aim of this type of strategy is to capture new demand, making their
prominent presence and also make competition by introducing products with attractive and
superior features (Gündüz, 2018). By this company can easily invite more and more customers
towards its offering sand also make huge profits.
In relation to this, if Terracycle use this type of strategy then involvement of new features
and uniqueness so that company can increase the competition level at market place. This type of
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activity can also increase the possibilities of capturing larger market share from its competitors.
Mainly, this strategy includes Value Innovation, differentiation and low cost that help in
improving the profitability level of company at market place. Thus, it is significant for the
business organisation to analysis the new market before introducing their new products in new
market so that company can identify the area of opportunities. This will assist in developing the
competitive image of company at market by capturing larger market share.
As per this theory, there are four prominent concept which are significantly used by
individuals for prominent application of theory in business. The process and concerning steps are
mentioned as:
 In modern times, business environment innovation is quite trendy and also basic tool that
tends to change and grab existing business opportunities. Therefore, business tends to
make effective innovation in their products to address the demand of market in terms of
gaining profitability. For this, company need to ignore the needs and preferences of those
customers which they do not target (Rofiqi and Kolis, 2020).
 For this, the business entrants tend to focus on the start-up's and also focus on the
downmarket social groups by considering their requirements in terms of having effective
target market to address the significant requirements in comparison to before and
effectual manner.
 For this, organisations need to focus on the profitable customer base and audiences ignore
the new individuals by not considering them as the competitor.
 After that, entrants tend to make effective use of Disruptive innovation theory by moving
upward in terms of offering better solutions to the other segments and social groups
considering the effective profit of customers.
 Market is attracted and also tends to made the presence for new entrants that becomes the
disruptor for the incumbents and become their significant competitor for the longer
period of time in terms of changing attitude and core competencies with suitable
innovation and development (Biemans, 2018).
Therefore, in regard of this, theory it is applied for not have prominent attempt in terms
of bringing better products and services in market which is placed for disruption and also tends
to redefine the mechanical factor of business by developing effective offerings which is of low
value in comparison to having presence in market and also offer lower cost products to customer
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in low market segment. It also tends to undertake four significant aspects considering relevant
tips for effective innovation which are mentioned as: Not all innovation is disruption: As per the experts, Disruption is described in different
way in terms of which prominent things which are new and successful and also
prominently addressed as the disruption. In regard of business and industry context,
Disruptive innovation theory is applied only when the incumbent organisation
concentrates on the specific product and segment and somehow misjudge their
requirements, preferences and desires of other social groups (Tidd and Bessant, 2018). It
tends to depict the opportunity for being developed for the fresh developers including
small business and start-ups. Disruption can be low ended or new market: This theory tends to undertake two
prominent aspects which are useful by the new entrants in terms of entering and making
their presence. For this, the first one is low end disruption, in which business tends to
take entry in the market at the lower level and also serve customers to offer suitable
satisfaction to address the requirements. For this, the lower profit market and effective
social groups are identified considering the needs which are ignored by the incumbents
and also tends to express effective concern to accomplish the effective requirements for
effective profit margin (Ljovkina and et. al., 2019). Besides this, the new market
disruption is the one in which businesses tends to keep their focus in terms of competing
against the new consumption for the lower profit towards the social environment. For
this, the products and services are offered are prominent enough in terms of keeping their
customer happy at the low prices. Hence, the disruption kinds are quite different as it
tends to concentrate on serving effectively and also concentrate on underserved
customers. Disruption innovation is process instead of product and services: This theory is based
on defining the suitable process which is applicable for the effective execution and also at
the entering stage for the fresh company in market instead of significant products and
services. For this, innovation factors are more concerned and focused on the effective
process to enter and capture in market in terms of being innovative and unique in terms of
developing new offerings.
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 Choose battle wisely: New arrivals are not for all of them which are disruptive but the
incumbent tends to be very attentive and also keep on looking towards the emerging
businesses for various forms (Kelliher, Kearney and Harrington, 2018). Therefore, the
current business organisation need to be very complex regarding the understanding and
influencing for fresh business in terms of entering in new market area and also require to
make suitable decisions by considering the suitable impact of disruption takes place and
considering the impact to bring effective opportunities within the market area in terms of
offering suitable benefits which are offered to industry and respective business owners.
Benefits of Disruptive innovation theory:
 The prominent advantage of Disruptive innovation theory is beneficial in terms of
delivering the new opportunities for the success options for the overall industry. For this,
the industrial development and proper enhancement is quite influential considering the
needs of customers to successfully fulfil customers’ requirements. Moreover, it is
beneficial in terms of developing competitor to motivate for better growth and
opportunity considering the complex viewpoint in terms of serving their customers. This theory also tends to prove as beneficial in terms of offering long term vision for the
new entrants (Naqshbandi, Tabche and Choudhary, 2019). Besides this, it also offers far
vision in terms of enabling users to become more competitive to fight and compete with
large organisations and other concerning aspects.
Limitation of Disruptive innovation theory:
 The significant disadvantage with disruption innovative theory which need innovative
process and also developed for the effective strategy. Besides this, it depicts the effective
process which is developed and prominently put emphasis on the significant issues of the
social groups which are unanticipated in terms of leading way towards the success and
development.
 The Disruptive innovation theory concentrated on the significant ideas and effective
development of products considering the understanding level and requirements of
population (Erdogan, Rondi and De Massis, 2020). It depicts the significant demerit by
using Disruptive theory which results as the effective profitability in terms of offering
effective practices for the new arrivals by which business owners required effective
amount of resources, money and motivation.
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 Shortage of financial support is another demerit as the procedure of Disruptive innovation
is quite slow and futuristic considering the nature. Therefore, this concept depicts the
prominent goals within the beginning and also fulfil requirements slowly. Besides this,
the finance undertakes new emerging business owners in terms of collecting money for
their operations and expect suitable return on the investment. Therefore, this model leads
to develop with disruptive innovation theory for the long-term return of new ventures that
need huge investment.
Application of the Disruptive Innovation Theory in the historical development context
Company overview:
Terracycle is the private recycling business headquarter in in New Jersey which is a
privately held company and run as a volunteer-based recycling company in terms of collecting
and recycling pre consumer and post-consumer waste and also join hands with municipalities in
terms of turning it into raw materials that can be used in the new commodities and products.
Moreover, company was founded by Tom Szaky and Jon Beyer and founded in 2001. Company
tends to create around 200 products that are licensed to manufacturers and also begin with the
production of fertilizers that are made from vermicomposting that are produced by feeding
organic waste to the worms.
Vision:
The vision of company is to eliminate waste by generating enormous amount of recycling
methods that are helpful in developing new product that helps in making environment clean and
sustainable. Along with this company also find ways to recycle traditional materials which are
hard to recycle.
Mission:
The mission of company is to offer free recycling program which are funded by retailers,
manufacturers and other brands across the world which are helpful for Terracycle to collect and
recycle those products which are hard to recycle.
Business Canvas Model:
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Key Partners:
 NGOs
 Governme
nt
 Supermar
kets
 Machine
Suppliers
 Ecological
and fair-
trade
labels
Key Activities:
 Design
 Promotion
 Recycling
Value
Proposition:
 Make
people
think
twice
before
throwing
waste here
and there
and use
trash
container
by
developin
g a chain
of
machines
in various
ways.
Customer
Relationships:
 Make
their
nation
environme
nt
friendly.
 Spread
recycling
word and
make be
green a
new trend.
Customer
Segments:
 Families
with kids
 People
who don’t
recycle
 Young
people
Key Resources:
 Engineers
 Volunteer
s
 Managem
ent
Channels:
 Supermar
kets and
hypermar
kets
 Social
media
Cost Structure:
 Cost of buying and renting machines
 Logistics
 Warehousing in Supermarket
Revenue Streams:
 We get sort of commission from the
extra money from the customer pays
when the waste is bought.
Historical development of Terracycle:
Terracycle is a recycling company that leads to collect waste from various areas and
recycle them in terms of making new products which are helpful for the company and Nation as
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well to make sustainable and clean environment. With the prominent Vision and Mission
Terracycle can significantly eliminate pollution from the environment in terms of offering clean
and sustainable air to the citizens. Besides this company also develop around 200 products under
the licensed manufacturers instead of their own licence. currently company tries to find those
products which are hard to eliminate and recycle.
By doing this Terracycle can make prominent initiatives in terms of making environment
more sustainable to others. Moreover, the disruptive innovation theory significantly fit
considering the functioning objective and development of Terracycle. By considering the present
environment condition it is important that company to recycle more and more products including
polythene paper bottles and many more in terms of making new products and try to eliminate
waste across the surroundings (Wiegmann, 2019). It is helpful in making people more
comfortable besides their surroundings by offering them clean and fresh environment.
Moreover, the destructive innovation theory is applied as company prominently analyse the
requirement of individuals which are addressed considering the products and services of
company. Along with this teracycle also develop its application that give significant alert to them
in terms of collecting waste and garbage from the prominent areas by focusing on maintaining
fresh and sustainable market as it tends to offer various services along with their application
(Katunina, 2018). Terracycle changed the Dynamics of market by entering into the business
world with their prominent accessibility without any additional cost.
Therefore, the destructive innovation theory was developed and useful for the company in
terms of developing their presence within the market and also at the worldwide level and
company also tends to capture around 92 marketplaces of the world. Presently Terracycle is
known as the leading recycling company within the waste elimination industry with prominent
services that helps in making environment sustainable and clean.
Application of the Disruptive Innovation Theory in the future development context
The disruptive innovation theory is the procedure which depict several stages that leads to
enable organisation and significant applicant in terms of reaching towards the particular
Conclusion and also add value to the solution in terms of taking entry within the market by
developing their effective presence and also tends to make prominent he use of the market
research buy significantly increasing with the competition and also considering unique selling
points within the industry (Zharov, 2019). In terms of future development and innovation with
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the offerings of Terracycle company tends to enhance their working area within the recycle
industry add concerning services.
Currently sustainable and clean environment is the trend and individuals and citizens also
focus on making their environment and surroundings Cleaner by considering the environmental
awareness programs and seminars. In regard of this citizens also take prominent initiatives in
terms of making environment more sustainable and cleaner considering the interest of other
individuals that leads to eliminate various harmful diseases (Thornblad, 2018). Terracycle so
identify an address requirement of market considering their preferences and demands in terms of
exploring the basic requirement of other culture and concerning factors by including prominent
facilities like auto collection of waste and garbage.
In regard of this company tends to offer various recycling programs which are funded by
various brands and other manufacturers across the world in terms of collecting and recycling
waste products which are hard to recycle and for this company currently recycled around 200
commodities which are hard to recycle by simply organising programs by collecting garbage
from homes schools offices and also consider free shipping labels (Rouyre and Fernandez,
2019). Along with this company also tends to provide premium services to their potential
customers in terms of having pollution free environment and fresh air that helps in making them
more sustainable for their surroundings.
Along with this the descriptive innovation theory is significantly applied and Terracycle
became the first recycling company who tends to provide various recycling services to
individuals considering various services and online platform. The market segment also tends to
attracted with the help of not for profit objectives and also spread awareness regarding
environment development among the people (Rofiqi and Kolis, 2020). Company also tends to
market and consider effective promotions for them in terms of having effective presents by
collecting prominent customer base for itself. Besides this there are various recycling company
exist within the market and across the globe and also engage in terms of offering various services
with prominent benefits to the recycling industry in which market segment is targeted on the
grounds of lack of time and also wish to make their surroundings and environment clean and
sustainable.
Besides this another benefit of recycling service leech to increase the awareness within the
environment and among individuals as well and also tends to make them both concerned
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regarding the sustainable development of environmental conditions by considering the global
warming and other causes of deforestation that leads to eliminate the oxygen level. Furthermore,
the descriptive innovation theory tends to enable an organisation in terms of expanding their
portfolio for the offered services considering several discoveries and prominent facilities on their
website and application which are more convenient for their customers.
It leads to offer a significant opportunity regarding the growth and development and also
needs to create potential features of the this is of company which are offered by them to the
general public and also post their new services on their website and also advertise through
magazines and another podcast. Company also function considering the guidelines and ethical
regulations that are issued by an organisation (Bonesso, Cortellazzo and Gerli, 2020). The
prominent plants which are bringing for the potential customers of company regarding
developing large customer base for an organisation. Along with this is the destructive innovation
theory leads to enable an organisation in terms of innovative and unique power to develop
expand and collect suitable customer base.
CONCLUSION
Therefore, by considering the above discussion it is identified that the significant
requirements and efficiency of innovation and uniqueness which is offered by the company to
their potential customers and new and Trends within the industry. The report also tends to
develop on the basis of managing innovation with the help of disruptive innovation theory which
is discussed in effective manner and also applied to the historical and upcoming ideas on the
grounds of company regarding the extraction of maximum benefits for it. Along with this the
descriptive innovation theory tends to process and analyse significant ideas for the strategy in
terms of entering into the market and also initially aim is to develop their presence within the
competitive business environment. Hence the theory leads to open the door for creativity
development and innovation in terms of offering various services considering the growth options
and expansion possibilities.
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REFERENCES
Books and journals
Au, A. and Tucker, J., 2018. Blue ocean strategy for microenterprises. International Journal of
Information, Business and Management. 10(2). pp.92-98.
Biemans, W., 2018. Managing innovation within networks (Vol. 7). Routledge.
Bonesso, S., Cortellazzo, L. and Gerli, F., 2020. Managing Innovation Through a Competency-
Based Approach. In Behavioral Competencies for Innovation (pp. 69-78). Palgrave
Pivot, Cham.
Erdogan, I., Rondi, E. and De Massis, A., 2020. Managing the tradition and innovation paradox
in family firms: A family imprinting perspective. Entrepreneurship theory and
practice, 44(1), pp.20-54.
Gündüz, Ş., 2018. Preventing blue ocean from turning into red ocean: A case study of a room
escape game. Journal of Human Sciences. 15(1). pp.1-7.
Katunina, I.V., 2018. Managing innovation projects: institutional perspective. Управленческие
науки в современном мире, 1(1), pp.82-85.
Kelliher, F., Kearney, A. and Harrington, D., 2018. Managing innovation in the hospitality micro
firm: A framework for sensing, seizing and reconfiguring dynamic
capabilities. Hospitality & Society, 8(2), pp.159-178.
Ljovkina, A.O and et. al., 2019. Managing innovation resources in accordance with sustainable
development ethics: Typological analysis. Resources, 8(2), p.82.
Naqshbandi, M.M., Tabche, I. and Choudhary, N., 2019. Managing open
innovation. Management Decision.
Rofiqi, M.A. and Kolis, N., 2020. PENGEMBANGAN MADRASAH PERSPEKTIF BLUE
OCEAN STRATEGY MTs ALISLAM JORESAN PONOROGO. EDUKASIA: Jurnal
Pendidikan dan Pembelajaran. 1(2). pp.270-283.
Rouyre, A. and Fernandez, A.S., 2019. Managing knowledge sharing-protecting tensions in
coupled innovation projects among several competitors. California Management
Review, 62(1), pp.95-120.
Thornblad, D., 2018. Managing Innovation without Managers: Valve Corp. Journal of Case
Studies, 36(2).
Tidd, J. and Bessant, J., 2018. Innovation management challenges: From fads to
fundamentals. International Journal of Innovation Management, 22(05), p.1840007.
Wiegmann, P.M., 2019. Managing Innovation and Standards: A Case in the European Heating
Industry (p. 171). Springer Nature.
Zharov, V., 2019, July. Methodological foundations of managing innovation-effective
development of industrial production of the Arctic. In IOP Conference Series: Earth
and Environmental Science (Vol. 302, No. 1, p. 012132). IOP Publishing.
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APPENDIX
Disruptive innovation theory
Applied Disruptive innovation theory
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Business Canvas Model
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