Here’s an epiphany I’ve had about disruption: the companies that are the most established with the hardest working, most brilliant people, the ones analyzing trends best — they’re the ones that are the most unprepared for disruption. These organizations become successful and complacent with their existing business model, and become trapped.
That’s the problem.
Downfalls Due to Disruption
The common belief is that Blockbuster never predicted Netflix would come in and disrupt them. But in reality, they were always well aware of the threat Netflix posed to their business model. In fact, Blockbuster even tried to buy Netflix a couple of times. They recognized that this new technology would be their undoing yet didn’t manage to make the proper changes to stop disruption from happening.
The same goes for Kodak. People believe Kodak got disrupted because they didn’t predict Instagram, nor the boom in smartphone cameras. Kodak invented digital photography. They just couldn’t move from their successful hardware business.
Stuck in Their Ways
The reality is that these companies were so set in their ways, they were disrupted because they couldn't make the changes needed to accommodate new ideas. It’s not that Blockbuster and Kodak didn’t have smart, ambitious, driven people within their organization. It wasn't because they didn't have the courage to drop what made them successful. The problem is that it’s tough to pivot to a brand new business model when a company is so entrenched in its processes, governance, and structures they’ve followed since conception.
Disruption-Proof Your Business
Businesses need to be ready to adapt and be flexible to the market. Knowing what’s next is not enough. But there are things organizations can do in the present to prevent disruption:
1. Develop a Culture of Innovation
Employees are only human, meaning they fear change as much as anyone. To foster an environment that welcomes innovation, encourage employees to think outside the box and present new ideas regularly. If they’re empowered to develop and drive their own ideas, it’ll be much easier to have everyone on board and move the organization forward.
2. Stay On Guard
Disruption isn’t a one-time thing. When a business manages to avoid disruption, it should be vigilant in preparing for the next potential roadblock to success. In the case of IBM, after being disrupted by Microsoft, they were forced to pivot their business strategy completely. This started with a change in the mindset around what the company did best. At first, they were focused solely on their proprietary products, but they switched gears and began focusing on services. It ultimately saved them.
IBM is proof that businesses not only can take a different direction with their service or product offerings to avoid disruption, but they must also let go of what’s made them successful.
That’s the fascinating thing about surviving disruption — you have to disrupt yourself to save yourself.