In 1995 Clayton Christensen coined the terms "disruptive technology" and "disruptive innovations" to describe technological innovations, products or services that use a "disruptive" strategy rather than "revolutionary" or "sustaining" strategies to overturn dominant or status quo products in a market.
"Disruptive innovations" can occasionally come to dominate an existing market, either by filling a role that the older technologies couldn't -- as cheaper, smaller sized flash memory is doing in the personal data storage area. Or by successfully moving up-market through performance improvements until finally displacing the market leaders and incumbents -- as digital photography replaced film photography as the front-runner.
At the heart of the Innovator's Dilemma for the larger, older, most historically successful nonprofits is the bind of general or unrestricted funds philosophy and the need to find ways to 'earmark' and connect donors and recipients in a better way. It's less about one OR the other, and more about borrowing ideas from each, and mutually benefiting from the unique selling points of the third party fundraisers and embedding them in the all-too-staid conventional groups.
That is from a very good post by Roger Craver, over at The Agitator. My only comment is that the same applies to the international aid industry.
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