Get Excerpted With Permission From The Creative Destruction Of ...

New products meet customer needs better, making previous versions inadequate or obsolete. Good examples of Creative Destruction include smartwatches replacing wristwatches, cars with improved gas mileage, and streaming replacing CDs and DVDs.

What is creative destruction? Schumpeter argues that industrial innovation and new technologies revolutionise the markets from within, destroying the old capitalist structure and creating new one.

An example of Schumpeter's creative destruction theory in history was the transition from the industrial revolution to the use of oil and today until we get to today's highly technological society where renewables are growing exponentially.

A Simple Definition. Creative destruction can be defined as the decay of long-standing practices, procedures, products or services followed by more innovative, disruptive ones. It is based on the principle that old assumptions need to be broken so that new innovations can benefit from existing resources and energy.

He is perhaps most known for coining the phrase “creative destruction," which describes the process that sees new innovations replacing existing ones that are rendered obsolete over time.

Creative destruction refers to the incessant product and process innovation. mechanism by which new production units replace outdated ones. It was coined by. Joseph Schumpeter (1942), who considered it 'the essential fact about capitalism'.

Schumpeter characterized creative destruction as innovations in the manufacturing process that increase productivity, describing it as the "process of industrial mutation that incessantly revolutionizes the economic structure from within, incessantly destroying the old one, incessantly creating a new one."