Think Tank: What You Need to Know About Disruption
Welcome to the Think Tank with Frank Kenney
With decades of analyst and integration industry experience, Frank Kenney is a fountain of knowledge on all things tech. Now, he aims to share that awareness with you. Come back every other Thursday for your biweekly dose of thought leadership in this blog from one of technology’s most insightful thinkers and gain perspective on a variety of topics ranging from what’s happening in integration today to what’s on the horizon, poised to disrupt the integration space going forward.
Like so many analysts, I’m very quick to talk about the impact that Amazon, Uber, and Netflix have had on their respective markets. While it’s easy to fall back on the concept of innovation in relation to these digital forerunners, I prefer to think about them in terms of disruption. The aforementioned companies have certainly brought disruption to the doorstep of their competitors, and in every instance, that changes the game.
The idea is that if you strive to understand what these companies have done, and you model your actions on theirs, then you may have the opportunity to reach some inflection point that changes your entire business.
Disruptor. Disruptive technologies. Disruption.
I love to throw around those words as well. In a recent conversation with some of my colleagues, we started to dig into what was meant by the term “disruption.” I was fascinated that the very nature of disruption is something that often gets glossed over, and when you dig down into what’s happened to historical, seminal ecosystems and markets, it has everything to do with challenging the status quo and providing a different alternative. Let’s break that down.
In any market, there are business processes that drive business and the behaviors of the individuals participating in that ecosystem.
For instance, in Walmart, there is a checkout process in which people line up with their carts, and when they get to the conveyor, they put the things they are buying on the belt. The cashier scans the UPCs which are associated with a pricing table, and a tally of what is “purchased” is displayed on a terminal. When the cashier totals out, the customer swipes their method of payment, and another business process kicks off for transferring funds. This checkout process is pretty consistent anywhere in the world you go.
The local gas station on the corner, who seems to have the best selection of wine in Tampa, has a counter and scans barcodes and then lets me insert my card to complete the transaction. The Asian market in Sunnyvale, California, that I frequent has the same system, as does the one-stop shop in the UK, the market in Paris, and the corner grocers in the Hari Juku district in Tokyo, Japan. It is the norm. It is what most have grown to expect.
Recently in some Whole Foods grocery stores, owned by Amazon, the checkout process has been disrupted. You don’t put things on a conveyor belt, you don’t scan things via a UPC and you don’t swipe your card. Everything is done via RFID and through an existing payment system. By the way, it’s the same payment system we use like madmen each holiday season on Amazon. And therein lies the disruption.
Disruption is not targeted at a particular market.
Rather, the disruption targets a process that the majority of consumers in that market consider “the norm.”
Let’s go back and look at Blockbuster Video. You rented a DVD for three days, and you needed to return it by close of business the third day. If you did not, you incurred a late fee. I frequently left the DVD sitting on the DVD player and not with my keys, and thus ended up incurring so many late penalties I might as well have bought the DVD. Then Netflix came and said, “Give us a list of the top 20 movies that you would love to see, we’ll send you one or two of them along with a prepaid-postage envelope that you can drop in the mail. Oh, and send them back whenever you’re ready – no late fees.”
That last bit was truly unexpected. Not an innovation – a disruption.
Uber didn’t disrupt taxis – instead, they disrupted the process of how you order and how you pay for these rides. They also disrupted who gets to drive and what vehicles are permitted. It was the massive disruption of the norms associated with multiple business processes that propelled Uber and Lyft.
Disruption is critical for all businesses, new and old, cloud-native, cloud-born, or cloud-migrant.
The disruption happens to the “the norm.” Instead of trying to imagine what your disruption could be, look at business processes that have been in place “forever,” represent established norms, and wonder how changing them can give you the leverage to build a new business.
Oh, and P.S., from the get-go, the technology that underlies any disruption doesn’t have to be perfect. But, to be disruptive, it does need to demonstrate that normal things can be done differently.