Disruption in the US machine tool industry: The role of inhouse users and pre-disruption component experience in firm response

We investigated how incumbent differences affect their response to a disruptive change and found that incumbents with access to inhouse knowledge that helps them understand “what to develop and design” and “how to do it,” are likely to be the leaders in matching the performance features in a disruptive product. We used the advent of machine tools with disruptive Computer Numerical Control (CNC) technology as the context and concentrated on the transition period when the machine tool demand was shifting from customized machine tools with mechanical controls to standardized machine tools with CNCs. We found that incumbents with access to inhouse users and broad pre-disruption component experience were the leaders in matching the agility of the disruptive products. Our findings suggest that the boundary conditions for the theory of disruption is more nuanced than what the literature predicts.