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About Business Disruption

Disruption caused by technology could be your biggest organisational challenge – and your greatest business success.

The world is changing at an ever-faster rate.  Digital technology is setting the consumer free.  But it’s also challenging, and in some cases destroying, the business models of established companies.

As a business leader, how do you respond to these incredible challenges?

You need to be aware of how strategy has evolved. How new business models and competitive advantages can be used. You need to lead your people with an urgency and agility that is unheard of for many traditional leaders. Most importantly you need to be building innovation into your business in ways never seen before.

If you don’t do this then you are at risk. Small agile companies will find business models that reduce or destroy your value.  Your size counts for nothing. Your ability to invest is useless if you don’t use it in the right ways. If you are not innovating then you will have to fight even harder later on. Fighting for survival.

Change now is preferable to massive forced change – disruption in other words.

What is business disruption?

Disruption changes everything
Clayton M. Christensen
Disruption is a much overused word in business. Often it has a negative connotation referring to “normal” processes being halted or replaced. Disruption in the business world is also not a new concept. The explorers who set off to discover a quicker route to India and came across North America were intending on disrupting the trade markets that existed. In that very old example they saw disruption as positive enough to risk their lives for.

Disruption today is characterised by some very rapid shifts in society. The changes brought about by the Internet, Mobile Phones and Moor’s law are mostly understood; the breaking wave of change brought to us by Context, Data and Metcalf’s law are not. What they all do is change the way we do things at a speed never seen before.

According to Harvard Business Professor, Clayton M. Christensen, innovation and disruption are not one and the same, “Disruptive innovations are not breakthrough technologies that make good products better; rather they are innovations that make products and services more accessible and affordable, thereby making them available to a much larger population.”

So while innovative companies and products make life easier, disruptive companies and products fundamentally change the way we do things and overturn existing products and business models.

Because of the technologies that are available today, which make things that were expensive cheap and accessible, no companies are immune from change and many will be disrupted. You have a choice to ignore the possibilities of disruption or to embrace the positive effect of these changes and disrupt yourself and others.

Will the increasing speed of change impact my company?

The relationship between customers and suppliers is changing. Increased choice means the reason to buy, or not to buy, can change overnight. So you have to be as agile in the way you manage your relationship with your customers as you do in your products and services. Also you need to be at least as quick as your competitors to make a change.

Manage Disruption can help by conducting a simple diagnostic exercise that will help you and your fellow executives determine whether or not your organisation is ripe for disruption. The exercise is based on a tool developed by us, and it can include an interpretation/training session for your executives.

Disruption can be distructive

What can I do to prepare for disruption?

Disruption needs agility
Digital transformation is the buzzword of the moment. It can be defined most simply as change initiatives based on digital tools.

In its predictions for 2015, IT research firm Gartner argued that “By year-end 2016, 50 percent of digital transformation initiatives will be unmanageable due to lack of portfolio management skills, leading to a measurable negative lost market share.

“By 2018,” the researchers added, “digital business will require 50 per cent less business process workers and 500 per cent more key digital business jobs, compared with traditional models.”

We disagree.

The real issue at stake is that digital is only a technology. Implementing a technology without a defined outcome in mind has never worked. What’s missing is an understanding of the disruptive effects that digital will have in your market, your people and your processes. That will be very specific to your situation and environment.

Does planning for disruption make sense?

We believe that you need to develop a plan: a plan that takes into account your specific situation, measures where you are today and predicts the impact that changes will have. You need to measure the effect on revenue, market share and profitability.

As with any plan, you need to quickly work out where you are, where you can get to and how to reach your goal as quickly and efficiently as possible.

This is not about digital technology; it’s about planning for disruption caused by technology. We have a methodology to help you develop such a plan.

Disruption can be positive

How do I mobilize to disrupt my competitors?

Disruption offers opportunities. These can be broadly split into three elements:

  1. disruptive business models,
  2. disruptive value shift for customers or,
  3. disruptive changes to the value chain of goods and services.

Understanding how to disrupt existing markets is not just about an amazing idea or a killer app that magically appears fully defined and falls into the lap of the disruptor. There are key elements and paradigms to help you break disruption into manageable parts.

Disruption comes quickly
Disruption is a new dawn
Disruption changes everything
Some of these key elements and paradigms are obvious but difficult to implement. An example is the use of data to drive decision making. It’s been reported that 70% of IT decision-makers consider their organisation’s ability to exploit value from big data as critical to their future success. 65% say they risk becoming irrelevant and/or uncompetitive if they do not embrace big data.

Our view is that struggling with hard to manage innovations is not the most effective use of your resources. Business examples show that layering technology innovations on top of each other give simple, but effective, business capabilities. This is the new disruptive innovation.

Does my company have the capability to disrupt?

Disruption is rapid change
Having the capability to be disruptive doesn’t just boil down to technology or budget. It’s about understanding.

Assembling the parts to the puzzle is one thing. The capability to combine those parts to be disruptive is a learned skill. By studying disruption, we’ve isolated many of the key elements. Combining those elements with the knowledge and experience of your people can give you the ingredients to disrupt your market and your competitors.

We offer expertise to help you determine if there are attainable opportunities for you to disrupt – and how you can best harness those opportunities.

How do I watch out for disruption in my market?

Digital disruption is breaking down barriers to entry in most markets. That means the pressure is on to ensure that your company’s products and services are as up-to-speed as your potential competitors’ offering.

Our research strongly suggests that the biggest threat to many organisations may well come from competitors targeting key parts of their business.

Your business may be threatened by small start-up companies with only a handful of employees and no need for the assets of larger companies.

Nowadays, a good idea is enough to attract funding and technology, and that can enable a start-up to disrupt a whole market. Never before has it been this easy to grow a business from nothing, and to completely dominate a whole industry.

The PathFinder Icon
And it’s not just the start-ups you need to watch out for. Giants such Apple, Facebook and Google may not want to become fully-fledged owners of your industry. But they might want to offer new services to their customers, and you might be in their way.

The question you need to ask yourself is “What do I have that they want and how do I protect myself?”

We believe that you need to watch developments in start-ups and disruptive giants with great care. Of course, you need an understanding of your specific industry, but you also need an appreciation of the waves of disruption that are happening all around you.

Watching for disruption is a full time job. We offer a service to our clients where we have a deep understanding of the disruption points they are at risk from. That deep understanding means we can provide highly personalised insights into our clients’ business landscape and the potential disruptors on the horizon.

Manage Disruption is run by experts in the field of business disruption. We provide focused training, expert consultancy and other services that will enable you to turn market or product disruption decisively to your advantage.  Once understood, the threat of disruptive technological or business model change can be turned into a huge competitive advantage.

Together, we can help you future-proof your success.

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