The word “disrupt” (and its many forms) has become the Tech world’s ultimate cliché. With the right amount of PR spin, any new technology can be passed off as disruptive. Usually the word evokes little more than an eye-roll from those in the know. And yet sometimes, it just fits.
Companies like Uber, the ride-sharing App, and Aereo, the television streaming company, have been embattled from the outset for their potential to disrupt how their industries establishment operates. Others like Instagram and Snapchat have commanded enormous valuations simply because incumbents are afraid they will disrupt their user base.
Investor Relations & Strategy Department researched “7 Steps to Becoming a Big Bang Disruptor”: We hope that you will find these very helpful; Happy Reading and Application into our business.
What’s unique about these disruptive technologies is that they don’t require a tremendous amount of research and development, they are very good almost from the start, and they are able to capture a mainstream audience practically overnight.
In the past you had traditional innovation, which was better, but it cost more. You could also be cheaper and not as good, but get a little better over time. What’s different now is the ability to be better and cheaper, simultaneously.
By analysing research from the Accenture Institute for High Performance and conducting interviews with entrepreneurs and investors, a number of characteristics that big bang disruptors have in common.
The Four Phases of Big Bang Disruption
The helpful conceptual framework for thinking about big bang disruption based on four phases: (a) singularity; (b) big bang; (c) big crunch; and (d) entropy. Striking features of the graphic include the length of the period of singularity (i.e. experimentation), the shortness of the exploitation period (the big bang itself) and the rapid decline or big crunch, which can be almost as steep as the big bang.
Singularity: This is the primordial ooze from which Big Bang Disruptors emerge.
It is populated by weird experiments and often weirder experimenters, who fling
together seemingly bizarre combinations of off-the-shelf parts and loosely connected service providers to launch new enterprises without a business model, let alone carefully crafted strategic plans with paths to profitability.
The Big Bang: The Singularity, the wild period of failed early market experiments, signals the imminent arrival of true disruption. When the Big Bang comes, everything is sudden, including success and failure. Customers either arrive at once or not at all. Big Bang markets are by their nature “winner takes all.” In this stage of the shark fin, time seems to move at an accelerated pace—for entrepreneurs.
The Big Crunch: That’s the trap that characterizes the Big Crunch. While the Big Bang stage is filled with excitement and exuberance, the Big Crunch is the sober morning after. It is the most dangerous stage of the shark fin. In the Big Crunch, start-ups and incumbents alike are frequently caught unprepared for the rapid market saturation that occurs when near-perfect market information brings every interested customer to their door all at once, to be quickly served either by them or aggressive imitators.
Entropy: By the end of the Big Crunch, customers have abandoned the old industry and migrated en masse to the new. Most incumbents leave the dying industry and its supply chain, taking with them whichever of their inventories, assets, and intellectual property have retained value in the new ecosystem and selling, as quickly as they can, those that do not. Some old enterprises find profitable homes in the new world; some pivot to other industries and some simply disappear.
Here, seven rules for becoming the next big thing:
1. Listen to Truth Tellers.
In soap operas, the so-called truth teller is the character who moves the story along and tells the audience where the plot is going. Every business needs one. They come in all shapes and sizes, from eccentric visionaries like Steve Jobs and Elon Musk, who latch onto a dream of the future with relentless persistence, to young employees who have moved from one successful start-up to the next because they have an eye for promising future technologies. “There are all these truths, but they are not necessarily obvious, except to the people whose lives depend on it.”
It’s not always people who are truth tellers, however these days, data sets and crowd-funding campaigns can go a long way toward indicating market demand. The thing about this rule is that it’s not always hard to find the truth. Listening to it is the hard part. Often the truth is very unpleasant. You don’t want to hear your 100-year-old market-dominant product that’s a cash-cow is going to die. And yet, heeding advice you don’t want to hear is the only way to stay ahead of the curve.
2. Perfect your Timing.
It’s easy to think that good timing is simply a matter of luck, but luck plays only a small role. To illustrate this point, they used the example of Amazon’s Kindle. It wasn’t the first e-reader on the market, but it was the best, because Jeff Bezos spent seven years waiting for the technology to mature to avoid problems the Kindle’s predecessors had encountered. Studying why others have failed is key to any Big Bang Disruptor’s success. You’re trying as a strategist to minimize how dependent you are on luck.
It’s a mistake, to assume that being first to market is best these days. The early-to-market advantage seems to be a thing of the past. A lot of the advantage goes to those who can execute when the market is ready.
3. Experiment often.
It used to be that the company with the biggest R&D department developed the most innovative new products. While those days aren’t totally gone–Google still churns out plenty of hits-gigantic budgets are no longer required to conduct small experiments that could turn into massively disruptive ideas.
Hackathons are a great way to experiment on the cheap. Give away money and carbs, bring developers in, and see what they can come up with in 48 hours. Twitter, for example, was born out of a hackathon at Odeo, Evan William’s podcasting start-up. They launched it to say let’s see what happens. It took on a life of its own. The cost of experimenting gets cheaper all the time. The risk of experimenting is getting very low as well.
4. Survive Catastrophic Success.
No, that’s not an oxymoron. Becoming successful beyond your wildest dreams is a fortunate challenge to have, but a challenge nonetheless. If you do create the better mousetrap, you’d better be prepared for the world to beat a path to your door. Otherwise, you could fall victim to your own logistical bottlenecks and lose customers.
Luckily, it’s easier than ever to find partners ahead of time that will help business’ owners ramp up capacity when they need it. The answer is outsourcing. “It’s much easier to rent the scale when you need it and de-escalate when you don’t,”
5. Anticipate Saturation.
Being a Big Bang Disruptor doesn’t end with the initial catastrophic success stage. Even the most disruptive businesses have to fight hard not to become the stodgy incumbents they once overthrew. One major part of that fight is realizing that your product, like all products before it, has a saturation point.
6. Shed Assets before they become Liabilities.
To continue their success, Big Bang Disruptors need to be planning their next hit before their first flames go out. When the end comes, it comes very fast, if you are waiting until things start to slow down before you think about what you will do next, that’s a recipe for disaster.
With social media and a 24-hour news cycle, information is disseminated more quickly than ever. That means that the majority of the consumers who will ever use a product will use it right away. There’s no market for stragglers who will show up later anymore. That’s why it’s critical not to devote all your resources to a single breakthrough product. Either start to reduce expenses early or begin using them to develop your next big hit.
7. Quit while you are ahead.
No matter how clear your vision, how perfect your timing, and how careful your strategic planning, at some point even as a Big Bang Disruptor you are susceptible to disruption yourself. To stay alive, it is critical to anticipate those threats, realize that your once-novel innovation is slowing you down, and have the guts to cut the cord.
Philips, for instance, was a pioneer of incandescent lighting. But when its leadership team saw that LEDs were the way of the future, they pre-emptively announced they would be shutting down their incandescent lighting division to focus on LEDs. They also urged other countries to mandate a phase-out of incandescent lights. In doing so, Philips, a 123-year old company, became a disruptor all over again.
It saved Philips from investing in all kinds of expensive ways of trying to salvage the old business. So many businesses and industries refuse to exit and wind up enormous parts of residual profits back into an industry they are trying to save.
Will our Organizations Change?
Making this shift thus entails a great awakening. Are today’s leaders and managers aware of the need to change and ready to make the transformation? Are they ready to liberate themselves from their mental conditioning and undertake the paradigm shift in Management? Can they escape the gravitational pull exerted by decades of Management practices on how to think and act? Can they see that the true future and prosperity of their firm lies in thinking and acting differently? Or will they scoff at the economic phase change and the accompanying Big Bang Disruption?
It’s an open question whether the current leaders of large firms will have the talent and courage to make the change. It means becoming a qualitatively different kind of organization. Those organizations that make the change will flourish. Those that don’t, will in due course become extinct. The choice is that thrilling and that grim.
https://www.inc.com/issie-lapowsky/7-steps-becoming-big-bang-disruptor.html