Famous Disruptive Innovations That Changed Industries

In 1987, US Steel ruled America's industry. Then a tiny rival's $250M innovation crushed them... Here's why this collapse matters for every industry today: US Steel was once untouchable - employing 1% of America's workforce and producing 67% of the world's steel. They were the first company to reach a billion-dollar valuation. Post-WWII, demand was insatiable - cars, buildings, infrastructure, all needed steel. But while enjoying monopoly power, they made a fatal mistake. They focused exclusively on their most profitable product: sheet metal. Enter Nucor, with a radical approach. Instead of coal furnaces, they built "mini-mills" using electric arc tech and recycled scrap. Big Steel executives "laughed their ass off" at Nucor. Why? Mini-mills only made low-grade products - rebar, basic beams, nuts, and bolts. US Steel saw no reason to defend their least profitable segment. Then in 1987, Nucor bet $250M to rewrite industry rules, attempting to make premium sheet metal in mini-mills. Experts called it impossible. For 2 years, Nucor engineers faced constant setbacks, with molten steel spilling everywhere. But in 1989, they achieved what US Steel thought couldn't be done. The impact was swift and devastating. By 2001, 25 American steel companies went bankrupt, including Bethlehem Steel (industry's #2). That same year, Nucor surpassed US Steel in market share. US Steel's fall wasn't about foreign competition or labor costs. It was failing to see the disruption starting at the market bottom, moving upward. Today, US Steel is selling to Japan's Nippon Steel for $15B. Meanwhile, Nucor's market cap is $43B—nearly 3× higher. This pattern repeats in every industry: 1. Incumbents protect profitable segments 2. They dismiss lower-tier market innovations 3. These innovations march upward 4. By the time they see the threat, it's too late

People talk a lot about "Disruption" and nobody really knows what it means. For me there is a super simple definition. And it's not the late Clayton Christensen's ( more on that in the comments ) Disruption isn't about a lower cost way of doing something by leveraging tech, and it's not the Jean Marie Dru idea of "going against conventions" Disruption is the art of challenging the shared assumptions that hold an industry back, and tapping into the enormous gains that can be made by knowing how and when to break which rules. One nice (but obvious) example is always Tesla, for years the Auto industry employed the best, smartest and most compliant engineers to tell them what Elon Musk was doing was both impossible and undesirable. And now EV's are not cheaper cars, but they totally change the dynamics of the marketplace, with a myriad of impacts from how cars are sold, serviced, operated, financed, repaired, and what core skills a car maker now needs. But the example I love the most, because we don't talk about it enough, is the Nest thermostat by Tony Fadell. Before the Nest, no Consumer cared about Thermostats. Thermostats were rather expensive, totally and utterly unusable, but nobody really cared at all. We accepted that our homes would never be efficient, that we'd never program them to come on some days and we'd generally find that $300 wasted on electricity was better than 17 hours spent trying and failing to program them. Honeywell designs in particular seemed to be so perfectly terrible, that I presume half of the company sold therapy and Benzodiazepines to help people recover, in a genius act of vertical integration. You see nobody "bought" Thermostats. builders and home construction companies were "sold" them. They were just another B2B transaction on a long list of inventory. Then the Nest came along and it all changed. Here was a Thermostats people would talk about, people would share stories, people would visit shops and buy them, people would wire them themselves, people would program them, people would save money. Nest isn't a story of a trillion dollar company, it's a beautiful large to medium sized, rather slow, takeoff. Nest isn't a story of incredible leaps in technology or AI, or Voice, but really beautiful wonderful design and empathy. Nest isn't a story of using technology to make something cheaper, or subverting an industry based on cost savings, but totally changing an industry, so that an entire new population cares and goes out and buys something. I love the Nest, I love all that it stands for, I love the process it involved and I wish we had Nests in our live everywhere. Where is "Nest, but for Printers", or for Microwaves, or Digital Art frames or for all manner of items that could be a lot more special, with a little bit of genius and a lot of craft?

How did Canva, Google Docs, and Turbotax disrupt their markets? They built worse and cheaper products compared to the market leaders. Many believe disruption means breakthrough technology. The reality? True disruptive strategy follows a counterintuitive path - one that most business leaders overlook. Let me break down what a disruptive strategy really is: - Performance: Intentionally worse than existing solutions - Price: Significantly cheaper than current options - Target: Overserved customers and non-consumers Two types of customers it serves: 1. Overserved customers who: - Don't need all available features - Are willing to sacrifice performance for cost - Find current solutions unnecessarily complex 2. Non-consumers who: - Can't afford existing solutions - Lack access to current offerings - Will embrace a basic solution Here’s 5 real-world examples of this in action: - Google Docs versus Microsoft Office - Canva versus Adobe - TurboTax versus traditional tax services - Coursera versus traditional universities - Dollar Shave Club versus Gillette There was a few factors that made it a critical success: - Focus on simplicity - Dramatically lower prices - Increased accessibility - Gradual feature improvement Understanding this strategy explains why market leaders often miss disruptive threats: They're looking for better and more expensive solutions. But the real threat comes from worse and cheaper alternatives.

The $50B idea that started in a car: In 1956, IKEA designer Gillis Lundgren faced a problem-- A table wouldn't fit in his trunk. His solution? He removed the legs. This sparked an idea that would revolutionize retail: What if ALL furniture could be taken apart? The question eventually turned into the LÖVET table - IKEA's first flat-pack furniture. The impact was immediate: → Shipping costs fell 80% → Storage space reduced by 60% → Furniture prices dropped dramatically → Global expansion became possible IKEA turned a problem into their signature that led to: → 12,000 products → 460+ stores globally → $50B annual revenue → Revolutionized furniture retail forever Sometimes the biggest innovations come from: → Solving problems right in front of you → Challenging industry norms → Making constraints your advantage What's your favorite company example of turning a problem into an opportunity? ♻️ Share and follow me for similar content like this.