Disruptive innovation: a risk worth taking?

Disruptive innovation is a controversial topic that sparks mixed responses. In this post we explain how this type of innovation works and how it can be used for positive business growth.

Phuong Kieu
by Phuong Kieu
Disruptive innovation

Type the word ‘disruptive’ into Google and suggested synonyms include ‘troublemaking’, ‘unruly’, ‘riotous’, ‘undisciplined’ and ‘turbulent’. Subsequent synonyms then include the words ‘inventive’, ‘ingenious’, ‘new’, ‘novel’ and ‘fresh’. Disruptive innovation is a divisive topic. It excites some and terrifies others. Some view it as a necessity for growth, others as a risk too great.

Disruptive innovation gets a lot of bad press. American historian Jill Lepore recently launched a vehement attack on the concept, branding it a ‘competitive strategy for an age seized by terror’.  The scepticism that surrounds the term is understandable when it has been relentlessly preached and drilled into the management masses. This is only compounded by an unfortunately high number of unsuccessful case studies. It is a term that is both overused and misused but that does not mean it is not an important and potentially valuable concept.

Disruption is not destruction

Disruption does not have to take an ‘all guns blazing’ approach and therefore does not have to mean destruction. This is a misguided view of disruptive innovation; it is not about destroying existing business models. Rather, it is about saving them.

There is a need to encourage established corporations to avoid standing still when there is an army of startups battling their way to the forefront. Just because a business model has worked for many years does not mean it will continue to do so. Times change, trends change and people change. An acknowledgement that disruptive innovation can be an effective way of staying afloat of these changes is key to long-term business growth and survival.

We are keen to stress that disruptive innovation is not all about stamping on pre-existing models. Indeed, it may seek to undercut these but the bigger picture is to build a better one in its place. Accordingly, there needs to be a greater focus on the process of creating a more effective model, rather than on the dismissal of the previous one. Innovation is inherently about positive progression and growth. Focussing on what’s been broken is futile, when the whole point of disruption is bringing new ideas which work better for your business.

How disruptive innovation works

The traditional structure of disruptive innovation involves starting at the bottom of a market by providing a low-cost alternative version of a more established product. The vast majority of the target market are usually not aware that they have a need for this new product or service. For this reason, disruptive innovations usually start by targeting smaller niche communities, or they start life in emerging markets.

As a result, disruptive innovation is often the reserve of smaller companies and entrepreneurs (although not always) and this is why startups are more traditionally associated with the concept. However, only associating disruptive innovation with these small companies is at least partially the cause of all the bad press it receives. People don’t like seeing a much-loved corporation collapse spectacularly after having been pushed out the market by the new kid on the block (a la Blockbuster / Netflix). Although consumers inevitably soon move on when they realise that their lives have been improved by the arrival of the new product or service.

Making disruptive innovation work

We know that disruptive innovation works, as there are countless well-known examples of success stories. The catch is that disruptive innovation only works when it is done well. It’s an obvious thing to say but not an easy one to implement. Here is a selection of tips and advice to help you perfect your disruptive innovation strategy:

  • Disruptive ideas will never be realised without a change of attitude. Viewing these innovations through the lens of the current business model will inevitably create barriers for implementation. Reassess your processes and adapt them to allow room for disruption.
  • An agile approach is key to successful disruption, as it enables constant testing and reiterating. Often these innovations involve creating new markets or products, therefore much of the process relies on trusting the unknown. There will be no available pre-existing research or information to enable data-driven decisions, so intuition and creative discovery will be the necessary alternatives.
  • It can be easy to confuse the purpose of disruptive innovation as changing your customers and their attitudes. However, this is not the recommended approach; it should be about changing the market to help customers, not the other way around.
  • Disruptive innovation will not always be successful – it is the very nature of disruption for it to be a bit turbulent along the way. Nevertheless, in experiencing a series of innovations that are not wholly successful, you are building the foundations for a new and profitable business model in the long-run.

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