In the age of disruption we have seen so many determined entrepreneurial minds break through with simple, well-executed ideas that transform the lives of millions. From the supply and demand conduits of Uber and AirBnB, the accidental disruptors such as Google Maps and the flat out globalized disruptors such as Apple.
We are often startled by the simplicity of their innovation and the meteoric rise to public ubiquity in what seems like days. Of course, disruption h
as been happening for a aeons. Edison’s light bulb disrupted candle makers for example, however disruption now is somewhat different. Edison’s lightbulb was a invention of the truest order. It’s the pace of disruption that’s changed.
Modern disruptors simply use other people’s inventions (reusable code and off the shelf electronics) to create new innovative iterations which sync with today’s consumer (and indeed supplier) with vastly reduced product development costs and timeframes. It’s the pace that changed with a mix of enabling technologies + business model + impeccable timing.
Here’s how its done in 5 easy steps.
Step 1 | Look for a great idea that didn’t quite make it.
In their book “Big Bang Disruption” Larry Downes and Paul Nunes describe a “Singularity” before the Big Bang of disruption. At this phase, market experiments are happening on a small scale but only as a weak signal to the big market players. Often traceable to great ideas that didn’t quite make it these experiments offer an insight to new markets and possibilities and often fail due to underfunding, poor timing or just poor execution.
The forerunner to Facebook was MySpace. Although MySpace could never have been described a small player Mark Zuckerberg said that, “They were so inept we just couldn’t fail to do it better.” Now we can see how big Facebook has become, Myspace could easily be described as a weak signal.
Before Uber there was Google Ride Finder which was dropped but an idea, a technology and a market was identified for others to later exploit.
Many disruptors have capitalized on the failure of others who have blazed an unsuccessful trail only to illuminate a possibility, some lessons learned and fledgling market.
Step 2 | Think high volume low/no cost.
The key to any disruptor is that its low development and advertising costs keep the price to consumers very low. Most consumers now expect things for free and successful disruptors need the right business model to match. Remember that most disruptors will essential buy users and customers at the beginning using VC money.
Take the example of one startup I came across recently planning to offer a $30 hotel room for only $3 to customers whilst paying the full contract rate to the hotel. Although their model is unlikely to work due to the industries standard mechanisms, it nonetheless shows the intention. Buy users, monetive later.
Moves like that bankrupted bigger fish (Hoover in the UK is a shining example) but now it’s a popular business model and arguably unfair competition akin to economic dumping. Regardless, it’s the model and its here to stay. Speed, aggression and surprise is the key to achieve massive, overwhelming and seemingly overnight customer adoption which will be monetized at a later date.
Step 3 | Simplify
As the great bearded billionaire, Richard Branson said “Any fool can make something complicated, it’s hard to make something simple.” Bang on. Gone are the days when we needed to make things seem complicated and oh so specialized to justify the price tag. Disruption is all about taking something laborious, complicated and specialized and making it easier, more accessible and cheaper.
Think how Monster and other online job boards disrupted the traditional recruitment market. No longer did the candidate have to trudge through the newspaper or business press and then send CV’s by email with a long cover letter. 10 applications could be sent with less clicks than a dolphin saying “Hi.”
Step 4 | Experiment (a lot)
Floating ideas and small frequent experiments is a key trait of disruption that even large incumbent corporations now use. Get the basic concept right and test market even if it’s to a Facebook page.
I met a startup entrepreneur recently who had a great idea for a dating app and just started a Facebook page to see what type of response she’d get. When she got to 4,000 page likes she decided to go for it and her app will launch in a few months. Experimenting like this takes away that stomach churning “will they come,” feeling that most bootstrapping entrepreneurs get when they are developing a product or service.
As Paul Brown mentions in his book, “Entrepreneurship for the Rest of Us,” the key to a breakthrough is to take small steps, launch at an experimental level, see what they think and then refine the product until you find the winning formula.
Short feedback cycles are key. I do this after ever training workshop and recently came across a free/low cost app to get anonymous feedback online.
Step 5 | Innovative is a Culture.
The big mistake that many larger companies make is that they are not set up for the innovation required of disruption. Mistakes are not tolerated (especially in Asia) and this promotes a, “No risk culture” and a dearth of great leaders. Disruptive innovation can ONLY happen in creative environments where innovators are free to explore without the fear of a warning from HR.
The office space itself should be laid out to allow collaboration, experimentation and second glance moments that make you think differently.
Forget astroturf floors and indoor slides, recent research from Gallup concluded that Baby Boomers appreciated funky “Out there” office spaces more than Millennials. Think co-working space and immersive experiences. Not having regular desks is a great way to mix it up, creating the cross-functional discussions you need. Some of my clients now look more like Starbucks than an office with long benches and no desks.
Disruption is here, like it or not. Organizations can no longer afford the luxury of Darwinian pace organic evolution into evolving market conditions and need to accept that change now happens at an overnight pace more analogous to Global Warming. Smart organizations need to be the disruptor and not the disrupted and this requires a fundamental culture change.