The Innovator’s Dilemma

Daniel Libenson writing in today’s Haaretz:

Yom Ha’atzmaut came a month early at the University of Chicago. After a year of resisting the Chicago Jewish Federation’s demands to cut the budget of the university’s Hillel house in a way that would have killed our innovative program, Hillel’s board asked for corporate independence from the Federation and was promptly fired, as was I, on March 30.

Independence didn’t come about in exactly the way we had expected. It rarely does.

… People have asked me why this split happened. The simple answer is that there was a disagreement over where to cut the budget to compensate for the federation’s declining fortunes. Should we cut administration and overhead, as the Hillel board wanted, or should we cut the student program, as the federation wanted?

But the deeper answer is “The Innovator’s Dilemma.” In a book by that name, Harvard Business School professor Clayton Christensen seeks to explain why what he calls “disruptive innovations” – that is, innovations that constitute true paradigm shifts – almost always come from new players in a market and not from a market’s dominant companies.

… What has not yet been fully understood is that there is a revolution under way in Jewish life. We are only at its beginning – the early iPod stage – which is why it isn’t being seen for what it is.

What has been called the “innovation sector” is only about a decade old. It contains within it the seeds of a new Judaism in much the same way that early secular Zionism and early Hasidism did. Both started as fringe movements that were not embraced by the Jewish establishments of their day, and both ended up totally transforming Judaism such that it was barely recognizable at the other end of the transformation. The most radical and all-encompassing transformation in recorded Jewish history was the development of Rabbinic Judaism, which began life while the Second Temple still stood and then became dominant in the centuries that followed the Temple’s destruction.

The characteristics of the Jewish transformation beginning to take root in the innovation sector have not yet fully emerged, but they are beginning to.

… It has become quite clear that the old network of American Jewish institutions, especially those that operate in the non-Orthodox world, are in an advanced state of decay. They are built around the fundamental idea that Judaism is a status, not a choice, and Christensen’s research suggests that they will not be able to change.

It is thus critically important to the future of American Judaism that the innovation sector accelerate its transition from iPod to iPad so that a new network of Jewish institutions, organized around new ways of being Jewish, can take over before the old system collapses. The innovation sector needs major investments of capital to continue its “R&D” work and to scale up what is working. Our recent experience in Chicago suggests that this investment probably won’t come from the institutions currently dominating Jewish communal life.

You can read Libenson’s complete opinion piece, Judaism’s iPod stage, here.

The Innovator’s Dilemma, by Clayton Christensen, is a book about disruptive innovation and business. He differentiates two types of innovation: sustaining innovations which are incremental improvements on existing products – faster, smaller, better, cheaper – and disruptive innovations which represent something completely new in the market.