The Power of Disruptive Technology

by Janice Giannini

With a deep mastering at the intersection of IT and business strategy, consultant, board adviser and former C-suite executive, Janice has been harnessing the true power of IT for more than 30 years. An Executive and Board-level digital strategist at the intersection of risk and IT, she enhances competitive position through vision and equity with large-scale risk identification, quantification and mitigation in an ever-changing marketplace, generating long-term value for clients. She engages with senior executives and teams, particularly in complex businesses where misalignment is blocking their desired success, to develop and execute practical business strategies and plans. Clients have found her especially helpful when they recognize they must integrate an eagle's eye and worm's eye view in order to identify and remove obstacles. Janice has consistently taken on those challenges that others chose to run from. This typically involves those challenging times when failure is not an option and integrating business, technology and people changes must be accomplished simultaneously. As a result, many of her clients are complex organizations who won't settle for anything less than developing widespread professional competence.

I recently saw a post on the Huffington website, written by Clayton Christensen, et al. titled "The Off-White Papers." Intrigued by the title, I read it more out of curiosity than anything else. As I read, I found myself engrossed in his perspective.

The article addresses the speed at which disruptive innovations and technology move into a market space. Using the example of Lister's germ theory causing infections, Christensen draws attention to the fact that a carbolic acid solution that worked in the battlefield was insufficient to convince the US medical establishment to embrace Lister's theory. It wasn't until a precipitating event, the probably avoidable death of President James Garfield, that the medical establishment accepted it.

The trick, of course, is to understand why some innovations catch on and spread rapidly while others languish or come to a halt. In spite of the wealth of technical disruptive innovations today, some domains remain resistant.

So, what causes people to embrace a simpler, cheaper, and inferior disruptive product/service that decimates the industry leader? Apparently, consumers will "hire" a product or service if it is "good enough."

Christensen hypothesizes that inherent in any product or service is a utility and/or identity function. When a product or service's utility function is the dominant consideration, disruptive solutions spread quickly. In areas where the identity function is the dominant consideration, innovation can stall and may die.

He postulates that this distinction is what ultimately influences the speed at which disruptive innovations take hold. To understand the difference between utility- and identity-centric actions, consider the act of purchasing a KIA versus a BMW. For the sake of brevity, I leave you to consider on your own the similarities, differences, and motivators of the people who buy one or the other as a means of transportation.

Christensen contends that disruptive innovations that challenge identity have a different set of dynamics and, therefore, a stronger institutional/infrastructure resistance to change. As we observe slow-to-change domains such as healthcare, education, conflict resolution, and politics, we must look at which identity-centric values that are at stake and what we can learn from that.

Christensen called his article an off-white paper because it is "a disruptive innovation that refuses to traverse the slippery slopes of opinion-making and thought leadership. Neither a traditional think-tank white paper nor op-ed validated by a prestigious publication, an off-white paper might not be great, but it is good enough!"

Good enough for what? Perhaps to move the action one step in a progressive direction. Because I tend to look at technology, IT, and risk through the lens of a company director, I can't help wondering what insights and challenges this discussion poses for company leadership.

I invite directors and executives to seriously ponder the following questions as you develop your strategy:

  • Have you been so successful that you may not appreciate the power of disruptive technology innovations in your space?
  • If you are blind to it, how can you restore sight?
  • Are you unintentionally creating a culture that is resistant to innovation? Is this sustainable?
  • What identities are getting in the way of fully embracing innovation-enabled growth?
  • If you were starting with a blank piece of paper (electronic or physical) would you develop the product and services that you have today? What options are there to bridge the gap?
  • When was the last time you funded a small team to put yourself out of business, and then what did you do with the results of the team's efforts?

If you are an identity-based product or service, you must also ask:

  • What risk and competitive disadvantage are you embracing by not addressing the power and value of disruptive innovations in your space?
  • Are you only addressing the short term (let's just get through this year and worry about it later) or, worse, are you actively trying to thwart innovations impacting your market?