Because these firms listened to their customers, invested aggressively in new technologies that would provide their customers more and better products of the sort they wanted, and because they carefully studied market trends and systematically allocated investment capital to innovations that promised the best returns, they lost their positions of leadership.

Management has to provide the coordinating mechanism between what the supplier provides and what the user needs in not-good-enough situations where product architecture is consequently interdependent. Management always beats markets when there is not sufficient information.

In a large successful company where your power base as CEO isn't all that secure, it's hard for a CEO to pursue a truly disruptive strategy.

The transformation at the corporate level was achieved by selling off business units in old markets and by creating new business units to pursue the new opportunities. But the individual business units themselves within those transformed corporations were almost inert to change.

Ultimately, when you come up with a classification scheme that is collectively exhaustive and mutually exclusive, then the theory can become what Kuhn called a paradigm.

Capitalism has taught us that markets are always more efficient than hierarchical managerial coordination. But in a situation where those three conditions aren't met, I can't outsource or partner with you because markets don't function in the absence of sufficient information.

If I know what to spec, and I can measure it, and there are no unpredictable interdependencies between what you do and what I must do in response, then an economist would say that is sufficient information for a market to emerge between you and me.