Week 1

Chapter 1: Disruptive IT Impacts Companies, Competition and Careers Introduction

Learning Objectives
By the end of this lesson, students will be able to:
 Define disruptive technology and distinguish it from sustaining technology
 Identify real-world examples of disruptive IT and how they’ve affected industries
 Analyze the strategic responses of companies to disruption
 Understand how careers and skill sets are evolving due to disruptive IT

Key Concepts & Terminologies

Term Definition
Disruptive Technology Innovation that significantly alters or displaces existing markets and
value networks.
Sustaining Technology Incremental improvements that maintain existing systems or
products.
Digital Transformation The integration of digital tech into all areas of a business.
Creative Destruction A concept in economics where old ways of doing business are
destroyed and replaced with innovation.
Technological Job loss caused by automation or new tech replacing human labor.
Unemployment

Lesson Content
A. Disruptive Technology: Innovations that significantly alter or replace the traditional business
practices.
Examples of disruptions:
o Netflix vs. Blockbuster
o Uber vs. Taxi Industry
o Amazon vs. Brick-and-Mortar Retail
o AI/Automation vs. Traditional Jobs

Discussion Prompt:
1. Can you think of a product or service you use today that didn’t exist 10 years ago?
2. What’s technology you use daily that disrupted an older way of doing things?
B. Impact on Companies: Disruptive technologies don’t just add new tools to the marketplace—they
fundamentally change how businesses operate, what customers expect, and which companies
survive.

Case Study 1: Kodak and the digital camera revolution

What happened?
 Kodak was once the global leader in photography. It actually invented the digital camera in
1975.
 But Kodak chose not to pursue digital aggressively, fearing it would cannibalize its highly
profitable film business.
 Meanwhile, competitors (like Canon, Sony, and later smartphones) embraced digital
technology.
Outcome:
 By the time Kodak tried to catch up, the market had shifted.
 In 2012, Kodak filed for bankruptcy.
 Lesson: Failing to adapt—even when you invent the innovation—can be fatal.
Teaching Point:
Kodak fell victim to what Clayton Christensen calls the Innovator’s Dilemma:
"Successful companies focus on sustaining innovations (making current products better), and often
ignore disruptive innovations that start small but grow fast."

Case Study 2: Airbnb and the hospitality industry

What happened?
 Airbnb disrupted the hotel industry by enabling anyone with a spare room or property to offer
accommodation through an easy-to-use platform.
 It doesn’t own any hotels, yet it competes with major hotel chains globally.
Impact:
 Traditional hotels (e.g., Hilton, Marriott) had to adapt quickly:
o Investing in apps and digital bookings
o Offering more flexible pricing models
o Lobbying for regulation on Airbnb
 Airbnb introduced a peer-to-peer business model that made hospitality more personal and
often more affordable.
Teaching Point: Disruption often comes from outside the industry, not from established players.
What’s The Innovator’s Dilemma: by Clayton Christensen, this theory explains why large, successful
companies often fail to adopt new technologies even when they know they exist.

Why?

 They focus on current customers, revenue, and what already works

 Disruptive innovations often start off inferior or unprofitable
 But over time, they improve rapidly, take over the market, and leave old players behind

C. Strategies for Companies to Respond to Disruption

To avoid becoming the next Kodak, companies can take proactive steps:
1. Embrace Disruption Internally
 Companies like Microsoft and IBM constantly reinvent themselves.
o Microsoft shifted from selling software in boxes to offering cloud-based subscriptions
(e.g., Microsoft 365, Azure).
o IBM moved from hardware to AI (Watson) and consulting services.
 These companies disrupted themselves before someone else could.
2. Acquire Disruptive Startups
 Facebook (Meta) bought Instagram and WhatsApp to stay competitive.
 Google acquired YouTube and Android.
 These acquisitions help large firms absorb innovation and stay ahead of market changes.
3. Invest in Research & Development and Innovation Labs
 Amazon invests heavily in R&D through its Lab126 (which developed the Kindle, Alexa).
 Apple and Samsung constantly experiment with new tech (foldable screens, AR/VR).
 These companies don’t wait for disruption—they try to lead it.

Example:

Apple invests in R&D to design new iPhones or improve features like Face ID or camera quality.

Tesla uses R&D to develop better electric batteries and self-driving software.

4. Impact on Competition: Disruptive IT not only changes how businesses operate internally it also
transforms how they compete in the market. With the rise of digital platforms, cloud services, mobile
apps, and artificial intelligence, the rules of competition are being rewritten.
1. Industry Convergence and Blurred Lines

What It Means:

Industries that used to be completely separate are now blending together due to technology. A
company that started in one sector can now easily enter another—thanks to digital tools, platforms,
and data.

Examples:

 Apple, originally a tech and hardware company, is now in:

o Finance with Apple Pay and Apple Card
o Entertainment with Apple TV+
o Health with Apple Watch and health tracking features
 Amazon is no longer just an online bookstore:
o In cloud computing (Amazon Web Services - AWS)
o In healthcare (Amazon Clinic, online pharmacy PillPack)
o In logistics and delivery

Teaching Point:

Technology allows companies to leverage their platforms and customer data to break into new
industries, disrupting traditional players who never saw them as competitors.

2. New Market Entrants Using Platforms

What It Means:

Startups and small companies no longer need huge amounts of capital to launch new products or
services. Thanks to platforms (like cloud computing, app stores, social media), anyone can compete
— and succeed — with the right idea and execution.

Examples:

 TikTok came out of nowhere and quickly overtook Facebook, Instagram, and YouTube in
engagement, thanks to its unique algorithm and short video format.
 FinTech startups (like GCash, PayMaya, Revolut, and Klarna) use mobile platforms and
cloud services to offer banking, loans, and payments — challenging traditional banks.
 Shopee and Lazada use digital platforms to outcompete traditional retail stores by offering
wide product choices, low prices, and fast delivery.

Teaching Point:

Digital platforms lower the barrier to entry — startups with smart ideas can now scale fast and
disrupt giants who have been around for decades.
3. "Winner-Takes-Most" Ecosystems

What It Means:

Digital markets often lead to platform dominance—where a few players capture most of the
market share, thanks to network effects.

Network Effect:

The more people use a platform, the more valuable it becomes. This attracts even more users,
creating a self-reinforcing cycle.

Examples:

 Facebook dominates social media because “everyone is already there.”

 Google dominates search engines because it’s the most accurate and widely used — and it
collects more data the more people use it.
 Amazon dominates e-commerce due to its huge product selection, fast shipping, and
reviews.

These companies operate in what’s called a "platform ecosystem", where they:

 Control not just a product, but the entire environment (apps, payments, content, ads, etc.)
 Make it hard for competitors to enter or survive

Teaching Point:

Digital ecosystems favor few big winners, making competition more intense — and the cost of
falling behind much higher.

D. Impact on Careers: Disruptive technologies don't just transform companies and industries they
also transform the job market, often at a rapid pace. As new tools and platforms emerge, some job
roles become obsolete, while new, tech-driven roles appear. This change requires today’s students to
be adaptable, tech-savvy, and lifelong learners.

1. Obsolete Job Roles vs. Emerging Roles

What’s happening:
Some traditional jobs are being automated, replaced, or reduced due to technology — especially
those involving repetitive or routine tasks.
❌ Disappearing Jobs ✅ Emerging Jobs

Data Entry Clerks Data Scientists

Bank Tellers FinTech Analysts

Call Center Agents AI Chatbot Designers

❌ Disappearing Jobs ✅ Emerging Jobs

Cashiers E-Commerce Managers

Travel Agents Digital Marketing Specialists

Example:
 A company that once hired 50 data entry clerks may now use optical character recognition
(OCR) and AI tools to extract and process data automatically.
 However, they might now need Data Analysts to interpret that data and provide insights.
Teaching Point:
Disruptive tech doesn’t just destroy jobs — it reshapes them. People need to reskill and transition
into more complex, high-value roles that require creativity, strategy, and human judgment.

2. New Required Skill Sets

a. Digital Literacy
 More than just using Microsoft Word.
 Includes understanding cloud tools, data handling, online collaboration, cybersecurity basics,
and ethical tech use.
b. Critical Thinking
 With automation doing routine tasks, companies need people who can:
o Solve problems
o Make decisions based on data
o Question assumptions
o Think strategically
c. Tech + Business Alignment
 Today’s professionals must understand both tech and business.
 It’s not enough to code — you must know how technology creates value, cuts costs,
improves customer service, or drives growth.
 Example:
o A UX Designer needs to know both how to design user-friendly interfaces and
understand customer behavior to improve sales.

3. Importance of Lifelong Learning

What is it?
 The idea that learning doesn’t stop after graduation.
  With technology constantly evolving, the skills you learn today may become outdated in 5–
10 years.
Why it matters:
 Tools and platforms change fast (e.g., AI tools like ChatGPT didn’t exist just a few years ago).
 Certifications, micro-courses, online learning (e.g., Coursera, LinkedIn Learning) are now
essential to stay updated.
Teaching Tip:
Tell your students:
“You’re not just preparing for one job — you’re preparing for a career that will evolve multiple
times.”

4. In-Demand Careers Due to Disruptive IT

These fields are rapidly growing because they support, manage, or build disruptive technologies:
a. Cloud Computing
 Managing virtual infrastructure on platforms like AWS, Azure, Google Cloud.
 Roles: Cloud Engineer, DevOps Specialist, Cloud Security Architect
b. Artificial Intelligence (AI) & Machine Learning (ML)
 AI is powering automation, personalization, and decision-making.
 Roles: AI Engineer, Machine Learning Researcher, AI Product Manager
c. Cybersecurity
 As more data goes digital, securing it becomes a top priority.
 Roles: Security Analyst, Ethical Hacker, Cyber Risk Consultant
d. UX/UI Design
 Focuses on the user experience of digital products.
 Combines design with psychology and tech understanding.
 Roles: UX Designer, UI Developer, Interaction Designer
e. Business Analytics
 Using data to help companies make informed decisions.
 Roles: Business Analyst, Data Analyst, BI Developer