How Large Tech Companies Stay Current
In Clayton Christensen’s book The Innovator’s Dilemma, he postulates that as companies grow they struggle to keep up with innovative smaller companies because the margins aren’t as good on new technology. This makes it hard to justify investing in risky small tech projects that smaller competitors use to eventually overtake them.
Christensen’s dilemma appears to be taking place at IBM now as the once mighty tech giant tries to stay current by introducing cloud solutions to compete with Microsoft, Amazon, and Google. The problem is that IBM has had to shed its low-margin, high volume revenue centers in order to invest in new technology which has yet to grow to the size needed to compete.