Why Disruptive Innovation
The taxi profession never imagined the public would accept getting a ride from a ‘civilian’. Hotels never imagined competing against people’s apartments and guest bedrooms.
In this rapidly changing marketplace many organizations have taken big steps to open up adjacent areas of growth. But this focus on growth activities often leaves the back door open for competitors to dig away at your core business.
But protecting your existing business need not be a step backward. Using Design Thinking methods in a Disruptive Innovation workshop will gain critical insights into the fragility of your own business and pinpoint where to point the innovation pipeline to maintain leadership.
For full disclosure, we’re no business consultant. But we do specialize in product strategy and therefore this workshop is firmed pointed toward the product line, user interaction, and service of the brand. Workshop results may be surprising to your team.
“Doing a Disruptive Innovation workshop is like hiring a hacker to break into your network to help make it more secure - it can be as enlightening as it is scary.”
What is ‘Disruptive’ Anyway?
Although a more recent buzzword the term disruptive innovation goes back to 1995, and, as the Harvard Business Review defines it, it refers to competitor offerings that either;
a) Undercut an incumbent with a simpler, lower cost offering and gradually increase cost and quality thus eroding the market share of the incumbent.
b Create a new, alternative offering and a new market, without eroding from existing ones.
We have seen a third category evolve that includes new start-ups such as Uber;
c) Create a new, alternative offering that both creates a new market and cannibalizes from an existing incumbent’s market share.
Disrupt Or Be Disrupted
This popular mantra is misleading. A large corporation cannot turn away from its current market share and suddenly act like a startup who has nothing to lose. The solution is not to disrupt, but to actively prepare for the situation, which may mean;
Getting a tighter hold on existing customers,
Address new markets with a spin-off venture,
Create simpler, low-cost options, or
Pivoting the service or positioning.
While our clients have varied strategies arising from the workshop, the one common result is a renewed sense of urgency to address the potential issues before a potential ‘ankle-biter’ competitor begins eroding the incumbents’ market share.
Bringing Hidden Truths To The Surface
In the workshop we start by learning about different methods employed by successful innovators, and whether their approach is through disruptive Innovation or sustained innovation. We then overlay their methods onto our target category and consider what assumptions there are about how to purchase or use the product or service.
We then run through some user/customer journey mapping to find some additional pain points and then split into separate groups and create theoretical disruptive businesses, each with a different angle of attack. These fictional disruptors are each described not as a business plan but as a service and/or set of products, as a product strategy with unique positioning. This is an important difference that keeps us focused on the user/customer experience and not get distracted by the internal workings of the organization or technology offerings.
The workshop essentially reveals the most vulnerable areas for disruptive innovation to attack. Often they are outside of the focus of the management team, and contradict the assumptions at the very foundations of the company. And what becomes very apparent…. is its urgency.