The Speaker and Presentation: The speaker for the November 2004 luncheon was Nicole Toomey Davis, President and CEO of Enclavix. Ms. Davis was introduced by Richard Nelson, President and CEO of UITA (Utah Information and Technology Association). She has worked closely with Richard on several projects and has been a member of the Board of Trustees of UITA since May of 2001. Her involvement with UITA included leadership of the 2003 industry drive for adoption of Utah's Venture Capital Enhancement Act, designed to increase the available supply of Venture Capital for Utah companies.

The topic presented by Nicole Toomey Davis was “The Role of Innovation in New Market Expansion”. This hot topic seemed to gain a large amount of interest and drew heavily on concepts from Clayton M. Christensen’s books “The Innovator's Dilemma” and “The Innovator’s Solution”. Ms. Davis started out the presentation talking about the Maoris from New Zealand conquering the Moriori people of the Chatham Islands in the 1800’s. (From another book, “Guns, Germs and Steel: The Fates of Human Societies” by Jared Diamond.) The Moriori were hunter/gatherers and did not have the new technologies to deal with the weapons of the Maoris who invaded their island. They did not know how to respond and tried to make peace, but fell captive to the Maoris.

She compared this to marketing and markets: Companies think they may own this market segment or this customer (ie. “an island”). But in reality, no one owns a market – they are only “stewards or caretakers” and if not careful, may be conquered by someone else with a new innovation or technology. On the other hand, good stewards are rewarded with “good market share and good profits”.

Ms. Davis then went through several slides provided to her personally by Clayton Christensen. These slides covered the basics of his books and presented the concept of “sustaining” and “disruptive” innovations. The slides included the classic example of mini-mills disrupting the incumbent integrated steel mill markets. The disruptive technology starts by gaining a foothold in the low-end (and less demanding part) of the market, successively moving up-market through performance improvements, and finally displacing the incumbent's product. By contrast, a sustaining technology provides improved performance and, according to Christensen, will almost always be incorporated into the incumbent's product.

“In reality, no one owns a market and may be conquered by someone else with a new innovation or technology.”

Ms. Davis explained that with disruptive technologies – entrants nearly always win. With sustaining technologies, the incumbent nearly always wins. She gave a wonderful illustration of this concept using Tupperware as an example (she brought several pieces of plastic kitchenware to illustrate). Tupperware has been an incumbent in plastic containers and bowls for many decades.

However, the product was only available from direct distributors – “Tupperware Ladies”. Then along comes Rubbermaid and introduces a similar product in retail stores. Tupperware tries to respond by offering their product in stores for a short time, but upsets the Tupperware Ladies and therefore has to pull the product from retailers. Now a new disruptive technology shows up in stores – cheap, disposable plastic dishes from companies like DixieWare.

 Perfect for dinner “leftovers” and the likes, but without any need to clean. Some brands even feature a simple innovation: a little breather pop-up hole for cooking in the microwave. Ms. Davis asks the question: Where will Tupperware be in 5 years? She then asks us to ask ourselves this question in reference to the companies we represent and our individual skills: “Are we each a disruptor or a sustainer within the respective market segment?” And, “Are we a Maori, who will overtake? Or, a Moriori, who will be overtaken?”