Creating New Markets Through Disruption

Strategy

My days in elementary school can be summed up by the admonishing statement repeatedly found in my report cards: “Braden can often disrupt the class”. I think I’ve always had the desire to disrupt, which is why working with growing and aggressive organizations appeals to me. The more divergent their vision, the more creative their offering, the more they appear to be the underdog the more likely they are to have an impact in their industry. When they make a move they make big waves and that comes at the expense of larger, better funded, and established players. And the big guys usually have no idea what’s happening until it’s too late.

Disruptive strategies leverage innovation in products, technology or the delivery of value that creates a new market by applying a different set of values, which ultimately (and unexpectedly) overtakes an existing market.

Professor Rob Mitchell at the Richard Ivey School of Business comments that “established organizations are predisposed to under-react to ambiguous threats.” They may see the innovation coming but under-estimate the value to consumers or ability of the incumbent to scale and grow.

It’s not hard to see this effect in hindsight. Nearly 100 years ago Henry Ford’s application of assembly line efficiency for the Ford Model-T enabled the price of cars to be accessible to the masses. Today, disruption is evident in how streaming video has basically wiped out brick and mortar video stores (check out this hilarious video on Blockbuster by The Onion). Or how the digital camera eliminated film from mainstream use; and now smart phones are replacing consumer-level point-and-shoot cameras.

So how do you ensure you’re not the next Blockbuster or Kodak? How does your organization see the threats, evaluate them, and take the necessary steps to take advantage of the disruption?