On Management

What is ‘Disruptive Innovation’?

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Came across this term quite often, haven’t you? All those maverick entrepreneurs have done it and also some of the business leaders who lead the creation of new markets in developing neighborhoods.

Disruptive Innovation involves creation of an entirely new segment of customers or dealing with the worst customers established markets had. That can developing a new product, reaching out to customers who couldn’t afford the existing model or leading a wacky revolutionary belief system that simply crushes the popularity of existing market leader. Holy Cow, folks.

How do we do it?

We break away from the mold. The first step is understanding the current market, the products it has and the customers it serves. In many cases, the companies are established corporations. To tackle these, in the case of newcomers, they have two options. By ‘sustaining innovation‘, they can offer improved products to the same range of customers. By ‘disrupting innovation‘, they can create something that even the customers are not sure they need- cellular phones, personal computers, discount retailers- and thus establish a culture which the veteran corporates find hard to replicate. Steve Jobs went all out against IBM, convincing the population to feel the need to have its own personal computers. Michael Dell, however, competed against IBM by transforming the supply chain. He made sure his customers purchase computers directly from the company, thus nullifying the need to have middle men. They disrupted the entire system and it went into damage-control mechanism to settle down again. In the meanwhile, these brilliant entrepreneurs ate up a whole chunk of the market. Balakrishnan did it here in India. He set up his venture rediff.com when Indian population was slowly getting acquainted to the world wide web. And he has been working hard to entrench it ever since.

‘Disruptive Innovation’ is an interesting concept to be understood and applied. For it promises an edge and an opportunity for those awesome entrepreneurs out there. More on this:




Have fun kicking ass!

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