Disruption — The Creative Power of Destruction. Really?
Startups take great pleasure in flaunting their revolutionary spirit of attack and dream of shattering old systems with their innovation.
While established businesses shiver at the thought of being “surprised” and rattled to their core and worry that if they miss the next “disruptive” trend, they will become the next Kodak or Nokia.
But what exactly does disruption mean?
“With our innovation, we are revolutionizing the entire industry. We are the new Uber and Airbnb in our line of work.”
Aha, tell me more about it.
This kind of start-up entree is usually a sure sign that what follows is not revolutionary at all.
Why is the bar unnecessarily set so high?
Because everyone in the innovation business is constantly on the hunt for disruption.
“To disrupt” means “to tear apart,” “to divide,” or “to destroy.”
Sounds brute? It is?
It’s about creating something new through destruction.
Traditional business models, products, technologies, services, and entire industries and markets are to be destroyed, upended, and revolutionized. A disruptive innovation is supposed to completely displace the old.
Since this famous postulate by Joseph Schumpeter, the creative power of destruction has excited people in the technology world as much as in business.
What many fail to notice:
In reality, the creative power lies not in destruction, but in creating something new, as typical examples of genuine disruption show.
The inventor of the automobile was not primarily concerned with demolishing carriages, and streaming services do not count “destroying CDs and other sound carriers” among their core activities.
These innovations have solved customer needs in a completely new and convincing way and thus pushed existing systems out of the market along the way.
Great innovators don’t destruct.
They create, instead.
Destruction, please, but in an orderly manner!
As an expert evaluator for the EU Commission, my job is to track down promising, high-risk, disruptive innovations.
This is a very exciting task, with obstacles.
Because one of the first questions I have to evaluate is: Is there already a “willingness to pay”, i.e., customers willing to pay, sales figures, etc.? Well, we’re not so good at taking risks after all.
I dare say that the invention of the automobile would not have made it to the next round. Imagine the funding interview with Carl Benz:
“Mr. Benz, before we support the development of your `automobile’, we would like to know how many people would actually buy it. Have you ever sold a single unit of it? No? Well, how much experience do you have in the automotive business? Nothing either, aha.
We must say, you are not the first one to try something like this. Yes, let’s be honest, Mr. Benz, one component of your invention, the wheel, dates back to 4000 BC. So everything about your idea isn’t that new anymore. But come on, give us a two-minute elevator pitch on why someone would prefer your automobile to a carriage. Convince us!“
Wouldn’t that be absurd?
If we want disruption, we must also be clear about what that means.
Funding agencies, investors, and established companies are clamoring for disruption, but want it to be served up in an orderly fashion. That is a contradiction in terms. Destruction does not happen in an orderly manner.
If you order a wrecking ball, you have to expect walls to be torn down.
Start-ups have an easier time of it because they don’t have so many walls or a building yet.
And the first things established companies should “tear down” are short-and medium-term management goals and benchmarks that stand in the way of innovation in general and disruption in particular.
But that’s not what managers usually think of when they call for disruption.
The word means radical change, and if you’re not ready for that in yourself and in your organization, you’re better off dealing with incremental innovation.
That’s fine. Evolving markets, technologies, and processes instead of disrupting them is also innovative.
It doesn’t always have to be a disruption.
This piece was originally published in the Austrian technology magazine e-media in my monthly column “Code Red” (German edition).
