Disruptive Innovation For… Stability
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.
The taxi profession never imagined the public would accept getting a ride from a ‘civilian’. Hotels never expected to compete against people’s apartments and guest bedrooms. In this rapidly changing marketplace, many organizations have taken big steps to grow into new 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 backwards. 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 your innovation pipeline.
“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?
This 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;
- Undercut an incumbent with a simpler, lower-cost offering and gradually increase cost and quality thus eroding the market share of the incumbent.
- Create a new, alternative offering and a new market, without eroding from existing ones.
I would add a third category, so we can include the poster-child Uber;
3. 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.
A Disruptive Innovation workshop essentially reveals the most vulnerable areas for disruptive innovation to attack. Often these weak spots are outside of the focus of the core business and can be found in a blindspot that Design Thinking can bring to light.
What becomes very apparent at every DI workshop… is an urgent need for action.
More details on the workshop process is included in an expanded version in this linked article.
This article was written by Paul Hatch, TEAMS Design Chicago CEO. Originally published on https://www.linkedin.com on November 02, 2016.