“Should We Still Be Looking to Disrupt?”

    

That was a quote from a participant working on a small team taking the roles of executives going through abusiness-disruption-simuation business simulation experience that was focused on developing strategic, financial, and leadership skills. In the group learning discussion, she went on to ask, “After successfully going through a disruption, when is it time to take a break and enjoy the fruits of our labor?”

I found it extremely fascinating that it was only year two of a four-year simulation experience, but the team was feeling good and were leading in every metric including sales, profit, and total shareholder return. They had innovated and disrupted their market by launching a new game-changing product that nobody else had. Customers loved the new product. They purchased every unit available for sale and also back-ordered thousands of units.

As the team continued to think about their third year, much of the conversation was about not taking on more risks, saving their capital, and taking advantage of the great brands they had created including the new exclusive product.

In this simulated world, they had overcome the challenges of a pandemic, launched new products, invested in future products, and built tremendous brand loyalty. 

“What do companies do after a disruption? Don’t you ride it out until the next one? Why would we create another disruption that disrupts what we have built and are winning from?”

Great provocative questions that every business professional should think about.

To find the answers, let’s think of a couple of classic business examples…

  • Has Netflix stopped disrupting after they obliterated Blockbuster, invented video streaming, and has reinvented home entertainment?
  • Has Amazon stopped disrupting after they redefined eCommerce?
  • Has Tesla stopped disrupting after their market capitalization became greater than General Motors and Ford combined?

The answer to all three questions is unequivocally no. Innovators never stop innovating and disruptors never stop disrupting. That is the innovator’s dilemma and is one of the hardest things for leaders to figure out no matter what their strategy.

3 Reasons to Continue Disrupting

1 - Someone else will do it if you don’t

Disruptors have targets on their backs because they have done it, and everyone wants to do it better. If you are thinking of ways to disrupt your existing product then you can be certain that there are hundreds of people and businesses trying to figure it out.

2 - It’s all about scale

Disrupting a market is extremely hard. Taking the disruption and continuing to drive it through scalability is harder and more important. Netflix figured out a technology to deliver streaming video but that wasn’t enough for them. They needed to continue to disrupt by finding scale through more innovative technology and then through content. Netflix is able to deliver infinite content to hungry consumers who have an infinite appetite. That sort of scalability is what true disruption is all about.

3 - Your people will leave if you don’t

Disruptive companies hire people who know how to and love disrupting. Changing your strategy to rest on your laurels is not only a bad strategy, but it will cost you your most important people. Once you start losing your most important, disruptive people, you have lost the disruption game.

In conclusion, the simulation team that stopped and asked those original questions about why they should continue to innovate actually did stop innovating as aggressively as they had. They ended up in second place in the third year and basically ended up tied for last place with the value brand company in the 4th year as all of their markets and products had been disrupted by others.

zodiak pro business simulation

Robert Brodo

About The Author

Robert Brodo is co-founder of Advantexe. He has more than 20 years of training and business simulation experience.