Final answer:
Disruptive innovation can lead to company growth or decline, and can even result in businesses shutting down; it does not create small changes. The vacuum cleaner company that innovated in India and then brought those products to the U.S. is engaged in reverse innovation, which may lead to disruptive innovation. A dual capability in organizations, allowing both exploration of new ideas and their structured implementation, is critical for enduring success.
Step-by-step explanation:
Disruptive innovation could have several outcomes for companies; it can lead to growth, cause businesses to shrink, or even put companies completely out of business. It does not, however, create small changes to products and services; by definition, disruptive innovation creates major shifts in how industries operate. For example, streaming services have largely replaced physical media in music and movies.
When a company known for high-quality, high-priced vacuum cleaners goes to an emerging economy like India, identifies a gap in the market for inexpensive stick vacuums, and then successfully sells these new products back in the United States, it is engaged in reverse innovation. This process can lead to disruptive innovation as it may introduce new products that didn't exist before in affluent markets, potentially displacing existing products and changing industry norms.
Corporations must often be ambidextrous, balancing the freedom for employees to explore and discover new ideas, ('exploration') and the structured, centralized implementation of these ideas into marketable solutions ('exploitation'). This dual capability is essential for ongoing innovation and remaining competitive in rapidly evolving markets.