Disruption or Innovation


Soma Keshri, Oct 24 2017


How to stay ahead from the competitive market


People are sometimes confused about the difference between innovation and disruption. It's not exactly black and white, but there are real distinctions. Think of it this way: Disruptors are innovators, but not all innovators are disruptors -- in the same way that a square is a rectangle but not all rectangles are squares. Innovation is the creation of something new. Disruption is the creation of something new that displaces the old.

Harvard Business School professor and disruption guru Clayton Christensen says that a disruption displaces an existing market, industry, or technology and produces something new and more efficient and worthwhile. It is at once destructive and creative.

The term "disruption" has been widely used as a synonym of "innovation", but the later is now preferred, because market disruption has been found to be a function usually not of technology itself but rather of its changing application. Sustaining innovations are typically innovations in technology, whereas disruption changes entire markets. For example, the automobile was a revolutionary technological innovation, but it was not a disruptive innovation, because early automobiles were expensive luxury items that did not disrupt the market for horse-drawn vehicles. The market for transportation essentially remained intact until the debut of the lower priced Ford Model T in 1908. The mass-produced automobile was a disruptive, because it changed the transportation market. The automobile, by itself, was not.

According to Shilen Patel, founder of business accelerator Independents United, “innovation is rational whereas disruption is irrational”.

He explains: “Hailo applied technology using a very rational set of rules to achieve innovation, whereas Uber’s irrational mind-set asked: ‘What if I could get everyone in London to be a taxi driver?’ They then applied technology to achieve their idea. is rational, Airbnb is 100 per cent irrational.”

So how does a business decide whether it needs to innovate or disrupt in order to stay ahead of the curve and the competition?

Mr. Shilen Patel says: “Entrepreneurs or corporates need to ask themselves two questions – first, is their category facing large-scale unpredictable change, and second, how much control do they have over that change? If you have control then you don’t need a revolution – you can innovate. If you don’t have control, you need to get to revolution before someone else does.

As Mark Zuckerberg said: ‘If we don’t create the thing that kills Facebook, someone else will’.”

Tim Taylor, founder of leadership consultancy Making Great Leaders, says: “The winning idea may come from one person in the ‘disruptive ideas team', but the rest pull together to bring the elements that make it possible – from research to technological capability to market assessment and organizational change. Their job is to take a crazy idea and make it believable, tangible and deliverable.”

They also need to know when the time is right to disrupt. These times tend to be when growth is looking the same, profits and revenues are steady or in slight decline – or when the market is converged, and, increasingly, when the technology is there to make it happen.

Automation and robotics technology has huge disruptive potential within many industry sectors, including food manufacturing, where automation specialist OAL Group is introducing its robotic chefs into the process.

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Disruptor or innovator, the key to success in any business is staying ahead of the competition  and continuously reinvent themselves in the light of the new digital and data-driven world. If knowledge is power, understanding the difference between disruption and innovation will go some way to shaping your response to competition.

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