How to defend against disruption?

Of course, they (the teachers) knew how to cope with it – they isolated me from other kids, gave me tricky problems to solve or as a last resort marshalled me to the Principal’s office.

I haven’t encountered ‘disruption’ as often since leaving school until last year when along with ‘digital’, it seemed to be the most frequently used word in business parlance. 

I always thought that disruption was something that caused a temporary interruption to an activity that is able to be resumed once the trigger was removed (e.g. the walk to the Principal’s office).  In fact, most meanings listed in a dictionary seem to suggest an interpretation entailing a finite period of time i.e. “to interrupt or impede the progress of”.     

However, in the context of business, disruption seems to have more serious and lasting consequences like destruction or often total extinction of a firm or a whole industry by an existing player or new entrant changing the game altogether.  It is not surprising that such disruptions require more resources than what a teacher can bring to play in a class room. 

Having said that, I am puzzled by the apparent lack of anticipation, readiness, and response on the part of many industries and firms in coping with disruptive forces.  While it may not be possible to ward off the threat totally or permanently, could we delay its onset or diminish its effect until we are able to reframe our thinking and re-orient our capabilities?   Instead, there appears to be a sense of resignation accepting disruption as invincible and demise as inevitable.   

Our inability to read disruptive signals may stem from how we undertake SWOT analysis nowadays.  SWOT has been reduced to a near futile exercise – a subjective, vague, unimaginative and wordy list of Strengths and Weaknesses, Opportunities and Threats without the basis of a robust environmental scan.  The confusion between Strengths and Opportunities, Weaknesses and Threats is also not uncommon.  A thorough analysis of the implications and impact of each of these factors and a realistic estimate of the likelihood of occurrence of Opportunities and Threats is nowhere to be seen.  SWOT is living up to its dubious expansion: “Such a Waste Of Time”.   

Rebuilding one’s SWOT capability takes time.  It requires talent, application and training.  But there is a lot that businesses can do in the short term while disruptive forces are gathering momentum elsewhere.  Disruption occurs when there is a value disequilibrium at some point(s) in the value chain.  Providing greater value to existing customers (NOT necessarily dropping prices) can help in cementing relationships.  Combined with a natural reluctance among buyers to switch (not out of love or loyalty but because of lethargy), it is possible to plug the hole temporarily as long as the intent is clear and the manner is sincere.    

But levees cannot stop a hurtling tsunami.  Marketers and business managers need to work together to find ways to restore balance in the equilibrium at every section of the value spectrum– value conception (in terms of product benefits and supply chain efficiency), value creation (production and operations), value delivery (logistics and distribution), value perception (positioning), value expression (sales, marketing communications and promotion) and value recovery (pricing and customer service) etc. 

For starters, Marketing can look at product-service bundles (instead of products or services alone), map distribution beginning with the end consumer (not the manufacturer or service provider), structure price based on 'what it is for' and not focussed on a number and use promotion as a conversation starter (not a sales closure).  The opportunities for value addition for the business and the consumer can thus  be endless.

Disruption is not a new phenomenon.  Technology and globalisation have only enabled it to be more pervasive.  Disruptive thinking has always been a part of our business landscape, from Sun Tzu to Kahneman.  Concepts like Marketing Myopia and Blue Ocean Strategy, Positioning and Disruptive Innovation have been used by businesses small and big to disrupt the status quo. 

To think all disruption is about technology is only folly.  The year 2016 will see more buzz words such as Internet of Things and Internet of Everything populate our lexicon.  IoT is not about devices, not even about data but about delivery of convenience (some necessary, others avoidable).  Those that recognise this fundamental truth will ride high on this new wave of disruption.  Others may use this knowledge to equip themselves better to withstand its onslaught. Disruption and defense will continue to co-exist.

One of my instructors at school once said “The most important things in life are not things.” (This will be true of IoT as the Internet of People will demonstrate).  Hopefully, my disruptions in class will be condoned now that I am able to recall my teacher's words.

By Mahesh Enjeti, Advisor, Bubblefish