Innovation and substitution have been running through the history of human development, and even new discoveries and researches may appear in the field of scientific research every day.
The invention of the steam-powered loom replaced the traditional home-made manual manufacturing, which reduced the production cost and accelerated the production speed;
In the early 1990s, CDs began to replace tapes, and since the early 2000s, the rise of online music stores created a new music industry chain, where you can listen to your favorite music without going to a record store;
More and more technological products have been invented, cars have liberated people's feet, and cleaning tools have rescued people from endless housework...
Innovation and reform have deprived a group of people of their original jobs and sources of income, but they have led to the rise of new industries and ways of working.
For example, the current prosperity and dissemination of new online media, although it has hit the traditional paper media, is a Latest Mailing Database development opportunity to break the boat and let the paper media re-examine the future development direction and reform strategy.
The change of the times is destined that no one can always follow a set of unchanging rules to deal with the changing future. "Keeping the same for everything" sometimes doesn't have a guiding role.
This development trend of "breaking the old and building the new" has become a powerful innovation force.
This form of development is " creative destruction ".
Creative destruction is an important point put forward by Austrian economist Joseph Schumpeter, which is the basis of his innovation theory and business cycle theory.
Creative destruction describes the process of "industrial mutation that constantly changes the economic structure from within, constantly destroys the old economic structure, and constantly creates a new one."
The theoretical origins of "creative destruction" can be traced back to War and Capitalism, written by German sociologist Werner Sombart in 1913 . In his earlier writings, Marx argued that the theory revealed that capitalist societies continue to generate and destroy wealth, and to destroy human wealth through wars and economic crises.
In Capitalism, Socialism and Democracy, Schumpeter develops Marx's theory and argues in the second part of the book that the "creative destruction" of capitalism will eventually lead to the disintegration of capitalist society.
Later, liberal and free-market economists saw "creative destruction" as a virtue of capitalism, used to describe the rise and fall of companies and industries to make markets more efficient.
In this view, creative destruction is a major reason for the success of capitalism.
The innovation of entrepreneurs is the driving force of economic growth, and innovation can continuously innovate the economic structure from the inside, that is, constantly destroy the old order and structure, and at the same time continue to create new structures. This process is called "creative destruction".
Through innovation, entrepreneurs constantly and creatively break the old market equilibrium, and economic growth is a process of dynamic competition characterized by this "creative destruction".
The philosophy of creative destruction sees economics as an organic and dynamic process, Schumpeter does not see equilibrium as the ultimate goal of the market process. Instead, he argues that many volatility equilibria are constantly being reshaped or even replaced by dynamic innovation and competition.
By using the word "destroy," Schumpeter directly implies that the process entails losses and profits, and that creative destruction has losers.
Amid the changes in the market, one company that has adapted very well is Netflix.
Founded in 1997 as the primary DVD subscription service, Netflix has followed this direction, successfully taking advantage of rapidly evolving mobile technology and ever-increasing internet speeds to become one of the largest video distribution networks in the world .