Most executives today fear, or at the very least think about, parts of their businesses being disintermediated, very rapidly, by someone who is faster, better, cheaper.
Whether you run a large, centuries-old bank, a Fortune 50 pharma company, or anymedium-sized company, there is always a looming threat of disruption. Even companies that can see disruption coming (Kodak and Nokia come to mind) often cannot prevent it from happening.
Today, many more industries are being disrupted at an accelerated pace. For example, sharing-economy darlings like Uber and AirBnB are eating away at established hotel and travel brands while financial upstarts like Betterment, FutureAdvisor, Voya, Wealthfront, iJoin, Captain401, and DreamForward nibble away at the retirement-services pie. Alipay took only a year to become one of the world’s largest mutual fund companies, and that’s when it was an online retailer!
What is it that enterprises miss about this kind of disruption? Is it incumbent complacency? The speed at which disruption happens? Perhaps it’s that the competition comes from adjacent verticals or unknown startups rather than traditional competitors. Or it might be an inherent inability to harness and adopt newer digital technologies.
Here are four key concepts executives should consider if they intend to out-disrupt the disruptors:
- 11Refresh your product/service mix. What worked in the past is not going to work now. Sophisticated customers and new geographies demand updated products and services. Use state-of-the-art technology platforms to enable bundling and un-bundling of products. Use the power of crowds to identify niche value propositions and to mine and monetize existing data.
- 2Rework processes. An elephant can’t dance, and a large enterprise cannot really be nimble if it is monolithic. Create a sandbox organization to identify and create simple processes that are flexible and can support new modular products and services. Map existing and new technology components to digitally enable these new processes.
- 3Think of the user. Conduct usability studies and use technology to listen to sentiment and simplify interfaces. Focus on providing ubiquitous access and humanizing all customer touch-points. Use BI not just for internal reporting, but for constantly upgrading the customer experience.
- 4Energize your culture. Recognize the differing needs of digital natives and long-time employees who maybe occasionally connected. Enable small, collaborative teams, and fund smaller, nimbler projects. Allow projects to fail, but document and disseminate lessons learned widely. Upgrade your HR policies, and provide training on new technologies.
You cannot make your company completely disruption proof. But executives that truly appreciate the disruptive power of digital technologies can prepare themselves and their businesses by continuously reassessing business models, fundamentally reworking processes, aligning all their brand’s touch-points to the needs of today’s more sophisticated customers and—most importantly—rewiring their internal cultures.
Post Date: 1/5/2016