This one seems like a no-brainer.

A tech company releases a $79 computer, so it has to be a low-end disruption, right?

Well, not exactly.

See, the way a low-end disruption works is by targeting those customers that are most over-served in the marketplace. It does this with a set of features that are considered just “good enough” to get the job done that those customers are looking to “hire.” As market incumbents begin to lose these over-served customers at the low-end of the market, they are happy to focus their efforts on the high-end, more profitable side of the market. Meanwhile, the “disruptor” slowly moves up the value chain with each successive sustainable innovation, capturing more and more market share.

In the case of Endless, this is a company that is not targeting over-served customers; rather, it is targeting non-customers (i.e., “non-consumption”). With the release of the Endless Mini – an internet-optional, budget-friendly computer – Endless is able to target those that can’t afford other computers that are offered in the marketplace. In contrast to low-end disruption, these customers aren’t gravitating away from incumbent product offerings, they are gravitating away from no product offering at all. Seen in this light, Endless’ “disruption” is much less about simply having a low-priced offering as much as it is about entering the market with a different value proposition.

The key question here is: has Endless truly uncovered a job-to-be-done with their $79 computer?

Learn more via TechCrunch: http://techcrunch.com/2016/01/09/endless-launch/

Ever wonder why so many New Year’s resolutions fail?

Three words are to blame: resources, processes, and profit formula -  or, RPP, for short.

Think of it like this: every day each of us prioritizes certain outcomes that we’d like to optimize (eating well, getting more exercise, meeting new people). To achieve these outcomes, we adopt a certain set of routines (or “processes”), which deploy the resources we have on hand (i.e., time, money, etc.), in order to help meet those outcomes.

Over the course of a year, as we continually reinforce these behaviors, we effectively engrain ourselves with specific RPPs, which are designed to achieve certain outcomes.

The problem is, once we decide that we want to optimize a new outcome – or resolution – we fail because we don’t yet have the right RPPs in place to achieve this goal. For this new resolution to succeed, we’d need to establish a new set of RPPs, specifically designed to that goal.

So, if you’re looking to get fit in 2016 and you’ve spent the past year refining processes that efficiently deploy the resources of Netflix, pizza, and your couch, now may be a good time to start re-thinking your 2016 RPPs.

Will you be shopping with the masses or breathing in the crisp fall air outdoors? REI, an outdoor gear company that is also the United States' largest consumer cooperative, is opting out of Black Friday for the second year in a row and encouraging its customers to #OptOutside.

The company is a great example of a retailer that has cracked its consumers’ “job to be done” – to create a retail experience that’s more about a shared community that stands for integrity, transparency, and a love of the outdoors than it is about simply shopping for product. REI has translated this purpose into everything from its product offerings to its promotional strategy.

An estimated 2.7 million people are opting outside this year and at least 275 other organizations, including Google, Subaru and the National Parks Service have joined in on the campaign. For REI's consumers, the Friday after Thanksgiving will be spent outdoors, not inside waiting in line for the next doorbuster sale. Will you be hitting the trails with REI's customers this year?

To learn more, check out Why REI Is Opting out of Black Friday Again This Year from Fortune.com.

Strategy is not a static thing; what works in one context may fail in another. Likewise, the strategy that senior management intends to employ may diverge from the one that actually emerges.

Over time, as users desired to make purchases on the site, an “emergent strategy” surfaced, and buyable pins became an attractive new opportunity.

By staying open to this new opportunity, Pinterest was able to shift resources accordingly and capture this rapidly evolving new opportunity.

Now, as they’ve expanded farther into the buyable pins strategy, the company has positioned itself as both an e-commerce platform and a major player in the world of customer acquisition for big brands.

What was the key to this successful transition?

Effective management of the strategy development process, a necessary characteristic of any organization that seeks to foster potentially disruptive opportunities, as well as a critical lesson from HBX Disruptive Strategy with Clayton Christensen.

To learn more, read Pinterest Expands Buyable PinsTo More E-Commerce Platforms, Reaching Thousands of Merchants (via TechCrunch).

Boston-based software startup Toast is one of the nation’s fastest growing companies, with a 550% year-over-year growth rate and sights set clearly on redefining the way restauranteurs run their businesses. 

While it's flourishing today, Toast initially struggled to find its place in the market and employed disruptive strategy techniques – effectively pivoting from an initial strategy of “specialization” to one of “integration” – to completely redefine its strategic focus and create a path to long-term success.

Toast entered the market in 2012 with an application that was focused on facilitating mobile payments at restaurants, allowing customers to split their tab, make payments, and get receipts delivered directly to their phones. According to President and co-founder Steve Fredette, it seemed like an easy decision at the time.

"The thinking was, let’s initially focus on mobile payments," he said. "It’s a service that we can easily sell and deploy. We thought we’d get a lot of volume with it, and build a marketplace.”

The problem with this approach was that mobile payments were only a small piece of a very jumbled "point of sale" ecosystem, which combines a variety of hardware and software to create a system that allows restaurants to take orders, process payments, and track sales and inventory.

Many of these legacy systems lacked key functionality, like the ability to manage customer loyalty programs, process mobile payments, and integrate online ordering, but proved incredibly difficult and expensive to build on to.

In discussions with a number of restaurants, Fredette quickly realized that he was not alone in his frustrations with the limitations of existing POS systems.

"The restaurants didn’t like that they had 5 or 6 different vendors with independent systems that didn’t talk to each other well," he said. "Online ordering was a system that didn’t talk to point of sale. Gift cards were a separate system that you’d have to train employees to use. Loyalty wasn’t built into the POS system. It was a bunch of pieces that didn’t fit together.”

Fortunately, Toast saw these complications as a strategic opportunity for the company and was quick to adjust.

“We felt in order to create a better customer experience, we had to start with the foundational side of it," Fredette said. "We started with the back-end, building in a way that we could layer a really good consumer experience on top of it. Now, we’ve built a system that is a bunch of systems in one.”

With this one strategic pivot, Toast was able to gain both a stronger footing in an intensely competitive landscape as well as a loyal following of hundreds of customers.

As Professor Christensen explains in our HBX Disruptive Strategy course, when you are competing in a world that’s characterized by performance that’s “not good enough,” you can’t win with a specialized approach, you must pursue an integrated system. Likewise, when you are competing in a world that is characterized by speed and modularity, you must pursue a specialized approach.

This is Part I of a two part series. Learn how Toast identified its customers' jobs to be done and leveraged those insights to improve upon its core product in Part II.

A product can be innovative without being disruptive: take the case of Apple's latest iPhone 6S release. 

With such new features as 4K video and 3D touch, this is a great example of a "sustaining innovation," as it builds upon pre-existing value networks and markets. 

People often refer to the iPhone as being “disruptive” – and they’re right – if they’re referring to the 2007 first generation release, which delivered laptop-type functionality for a fraction of the price. Since then, Apple has effectively “moved up” the value curve with sustaining innovations that continue to build higher levels of functionality.

The best iPhone ever isn't necessarily the best phone http://t.co/zSEiYI1NGx pic.twitter.com/BJSnmr8nQW

— WIRED (@WIRED) October 5, 2015

So, is the Apple iPhone innovative? Of course. But that doesn’t mean it’s still disruptive.

To learn more about disruption versus innovation, check out HBX Disruptive Strategy.

Think SoulCycle’s secret to success is all loud music and loads of sweat? Think again.

With an 85% loyalty rate among its riders, SoulCycle is a prime example of a company that’s perfectly nailed its customers’ “job to be done,” built all the right experiences around that "job", and then let its marketing and branding follow suit. In doing so, the company elevated itself into a “purpose brand," resonating with consumers and turning one-time riders into “soul” advocates.

A look at SoulCycle, by the numbers, as it preps for its IPO http://t.co/PAbDd2X2fi pic.twitter.com/Yyw4JwWAH6

— ForbesInvesting (@ForbesInvestor) July 31, 2015

The jobs-to-be-done framework was developed by Harvard Business School Professor Clayton Christensen to explain why people make the consumption choices they do. What makes this idea so powerful is that the job to be done pinpoints exactly what actually causes consumers to purchase one particular product or service over another under a given circumstance.

Consider for a moment what job health consumers are really trying to solve: most health clubs and fitness studios would probably tell you that it’s to get more fit. Sure, this may be true. However, it's not the full story. For some consumers, gyms are “hired" for their social and emotional aspects - the feeling of being a part of something bigger, or of having that moment of catharsis when you know you've pushed yourself to the limit. When viewed in this context, it may not just be another gym you are competing with to fulfill this job; alternatives might include running a marathon, joining a book group with friends, or even a night out at the club.

SoulCycle wants to change your life...and file for an IPO http://t.co/SDRpxHHAgi pic.twitter.com/EmV6uMifDe

— CNNMoney Investing (@CNNMoneyInvest) July 31, 2015

In discovering this job to be done, SoulCycle was able to tailor its product in an entirely differentiated way and then integrate all the right experiences around it. From the moment of check-in until the end of the ride, the SoulCycle experience is designed to deliver on aspects of community, atmosphere, emotion, storytelling, and most of all, being part of a movement that is bigger than yourself (not to mention providing a pretty darn good workout).