The Paradox of Disruption - CMA B2B Innovation Conference

!

Disruptive Innovation: The Paradox of Disruption

!THE WHOLE HISTORY OF ORGANIZATION AND

MANAGEMENT THEORY IS BASED ON THE IDEA THAT IT IS POSSIBLE TO ORGANIZE, PREDICT, AND CONTROL.

POWER AND CONTROL

!DIALECTICAL OPPOSITES

Innovate Avoid MistakesThink Long Term Deliver Results Now

Cut Costs Increase MoralReduce Staff Improve Teamwork

Collaborate Compete

Maintain Focus Be Opportunistic

Be Flexible Respect the Rules

Decentralize Retain Control

Low Costs High Quality

–Ben Horowitz “By definition they

are not obvious. In fact, they seem

insane. If they didn’t seem insane at the

time, they wouldn’t be breakthroughs”

Source: http://ilovefaygoslushies.deviantart.com/art/Insane-Base-415796210

http://ilovefaygoslushies.deviantart.com/art/Insane-Base-415796210

PETER DRUCKER, “BECAUSE THE PURPOSE OF BUSINESS IS TO

CREATE A CUSTOMER, THE BUSINESS ENTERPRISE HAS TWO – AND ONLY TWO – BASIC

FUNCTIONS: MARKETING AND INNOVATION. MARKETING AND INNOVATION PRODUCE

RESULTS; ALL THE REST ARE COSTS.”

"What new and different things do we have to do, and when?"–Peter Drucker

TOGETHER BE OPEN AND LISTEN

Breakthrough DisruptionOptimization Sustaining

Disruptive Innovation


Sustaining Innovation

80%

20%

Optimizing !Existing Markets / !Revenue Streams!

New Markets /!New Revenue!

New Markets /!New Revenue!

!

“SO ASK YOURSELF THREE QUESTIONS.”

!WHAT KIND OF INNOVATION DO I WANT?

!HOW MUCH INNOVATION DO I WANT?

!WHEN DO I WANT IT?

Projected cash stream from investing in Innovation & Marketing

More likely cash stream resulting from doing nothing

DCF and NPV methodologies implicitly make this comparison

Companies should be making this comparison

Assumed cash stream resulting from doing nothing

B

A

C

“FINANCIAL MIS-DIRECTION”



http://www.bluefinsolutions.com/Bluefin/media/Bluefin/PDFS/Bluefin-Solutions-Elastic-Innovation-Index-2014-Global-top-50-most-innovative-companies-(2).pdf!

!

ELASTIC !

• FLUIDITY TO ADAPT AND RESPOND

!• ABILITY TO CREATE

DEMAND



http://www.bluefinsolutions.com/Bluefin/media/Bluefin/PDFS/Bluefin-Solutions-Elastic-Innovation-Index-2014-Global-top-50-most-innovative-companies-(2).pdf!

AdaptiveCloud Infrastructure and Device CentricDeveloper-centric / ComputationalIdeas EconomyRadical AdjacenciesSocial CommunicationsEcosystemsMass DifferentiationCreative Independent TalentContinuous StrategyMultiple Options Management

ELASTIC

ARIE DE GEUS, “RESILIENT, LONG-LIVED COMPANIES ARE

THOSE THAT EXHIBIT CERTAIN OF THE BEHAVIOURS AND CHARACTERISTICS OF

LIVING ENTITIES.”✤ Strong sense of community and

collective identity around a set of common values

✤ Community where all members know that they will be supported in their endeavors to achieve their own goals – as well as the global goals of the community

✤ Openness to the outside world, tolerance for the entry of new individuals and ideas – in essence a manifest ability to learn and adapt to new circumstances

A“

THOSE THAT EXHIBIT CERTAIN OF THE BEHAVIOURS AND CHARACTERISTICS OF

LIVING ENTITIES!

“INNOVATE OR DIE”

!

EXPERIENTIAL WORKSHOPS WHERE YOU CAN PRACTICE “DOING DIFFERENT”

Directional Knowledge Identity & Motivation

Conceptual Knowledge Understanding &

Organization

Experiential Knowledge Skills & Awareness

Source: Knowledge System (Artistry Unleashed - Hilary Austen)

Mastery: Applying Developed

Knowledge Recognition, Effectiveness, Expertise, Purpose, Focus

Guides

Guides

Informs

Informs

Originality: Generating New

Knowledge Perception, Creativity, Innovation,

Flexibility, Openness

!THE LEARNING & INNOVATION LOOP

!WE HAVE ALREADY MOVED FROM

MANAGEMENT TO LEADERSHIP – AND NOW WE’RE GOING BEYOND

LEADERSHIP TO INSPIRATION… !

LEADERS MUST HELP PEOPLE ACCESS THEIR SOURCES OF

INSPIRATION, INTUITION AND IMAGINATION…

!TO FACILITATE SO THAT MY TEAM CAN

SENSE AND SEIZE EMERGING OPPORTUNITIES AS THEY ARISE IN

TODAY’S FAST PACED ENVIRONMENT

The Unexpected SuccessFailureOutside Event (Eureka Moment !)

Incongruity in Reality Asymmetry in Experience

Innovation on Process Need

Bridging a Gap

Change in Market Structure

Demographics

Changes in Perception Society Bites Back

New Knowledge

Drucker 7-Sources Christensen Disruption

What:

1) Simpler, Cheaper, & Good Enough

!2) Micro-Market

Underserved & Uncontested

!How:

1) Job-to-be-Done 2) Combinatory 3) Adjacencies 4) Trade-offs

!





Christensen

Horowitz



!Soon to be

Non-‐CustomersCustomers Refusing

Non-‐CustomersUnexplored

Non-‐Customers



!Soon to be

Non-‐CustomersCustomers Refusing


Non-‐Customers20% 80%

Optimize Differentiate Value Prop. Problems, Needs, & Use Cases

Degrees of Doing Things Differently

!

MARKETING MIS-DIRECTION

PROUST ““THE REAL ACT OF DISCOVERY CONSISTS

NOT IN FINDING NEW LANDS, BUT IN SEEING WITH NEW EYES”

!WHAT BUSINESS ARE WE IN AND IS IT THE RIGHT BUSINESS?!

!CAN WE CREATE FUNDAMENTALLY NEW PRODUCTS AND SERVICES?!

!CAN WE REDEFINE THE BOUNDARIES BETWEEN DIFFERENT INDUSTRIES

AND SERVICES SO THAT NEW NICHES EMERGE? !!

CAN WE STRUCTURE OUR ORGANIZATION AROUND BUSINESS PROCESSES THAT REFLECT A CUSTOMER VIEWPOINT RATHER THAN THE

INFLUENCE OF TRADITIONAL DEPARTMENTAL STRUCTURES?!!

CAN WE REDESIGN BUSINESS PROCESSES IN A WAY THAT WILL INCREASE THE QUALITY OF PRODUCTION AND REDUCE COSTS?!

!CAN WE REPLACE OUR ORGANIZATIONAL HIERARCHY WITH A

NETWORK OF SELF-ARRANGED TEAMS?!

Sustaining Innovation



Problem is Understood !Existing Market (red ocean)

Improves Performance

Lowers Cost !Incremental Change!Customer is Known!Market is Predictable !Traditional Business Model !Talk to Mainstream!Market Research!


Problem is Undefined

New Market (blue ocean)

Innovation is a dramatic

game changer

Customer doesn’t know

Market is Unpredictable

Traditional Models Fail

Talk to Early Adopter

Customer Development

Gaps/BiasesOvershoot in Sustaining Innovation !

Status Quo / Extrapolated Financial Forecasts !

Understated / Invisible Threats !

Commitment to Sunk Costs !

Lack of empathy



Order Chaos

More Options & Possibilities

More Insights & Patterns



Launch180: GTA Incubator/Accelerator

!

INNOVATION CHALLENGES!

FOOD AND NUTRITION BEHAVIOUR !

SENIORS AGING AT HOME !

AFFORDABLE / SOCIAL HOUSING !

EARLY CHILDHOOD DEVELOPMENT !

EXPERIENTIAL EDUCATION !

INNOVATION & INCUBATION !

HACKING TRADITIONAL MEDIA !

LEADERSHIP & CULTURE



!Soon to be Refusing


Non-‐Customers

SOLUTION

UNINTENDED CONSEQUENCE





Non-‐Customers

SPECIALIST

GENERALIST





Non-‐Customers

EXPERT

CROWD





Non-‐Customers

FINITE

INFINITE





Non-‐Customers

REALITY

PERCEPTION





Non-‐Customers

FIXED CAPITAL

HUMAN CAPITAL





Non-‐Customers

INFORMATION

KNOWLEDGE





Non-‐Customers

PLANNED

SURPRISE





Non-‐Customers

COMPLICATE

COMPLEX





Non-‐Customers

BIG DATA

STORIES EMPATHY





Non-‐Customers

ARROGANCE

EXPERIMENTS

LIBERTÉ

ÉGALITÉ

LIBERTÉ

ÉGALITÉ

FRATERNITÉ

LIBERTÉ, ÉGALITÉ, FRATERNITÉ

THANK YOU

The Paradox of Disruption - CMA B2B Innovation Conference

Marketing

Transcript of The Paradox of Disruption - CMA B2B Innovation Conference