Amplification beats disruption

Disrupting markets have for years been a formula for success for startups. Be nimbler, nicer looking and cheaper than the incumbents in your market, grow at a blistering pace whatever the costs associated with it and you will be on to doing great things taking your idea from it’s inception into potentially a unicorn scale-up.

While these startups have been blasting the competition to the roadside, there are a couple of things, we haven’t really discussed. One is the obvious fact that the expansion has only been possible due to a presence of excessive funding, sometimes with very little prospects for developing a viable business model going forward (Uber comes to mind as the poster example of this). The other is the more important one; that in the quest for disruption, more value has been destroyed than has been accrued by the startup.

Of course there is no rule anywhere in the capitalist world that suggests that challengers should be mindful of not destroying more than they create, and you could also very well argue that for customers that are left with a better service at a cheaper price, it’s a pure win. But in terms of the prospects of economic growth on the longer term, I would still suggest that the business of disrupting things just for the sake of disrupting it runs counter to what should be our common interests.

The challenge with disruption is that in the absence of real innovation, disruption doesn’t create anything. To put it in other terms the size of the pie stays the same, as there is no real growth anywhere. Now, you could argue that customers being able to get more for less increases the overall economic activity and make the individual better off, because he gets access to more, but we need to ask ourselves whether we really do think that improving our economic prospects by going cheap is really sustainable?

Just ask the American middle class. Think about how much of their economic growth is really down to the availability of ever more cheap products and services – aka crap IMHO – than, say, an ongoing positive development in their disposable income? It’s a lot more of the former than the latter, and it’s actually quite a systemic problem that we have done preciously little to try and fix but will need to fix sooner rather than later. If not for anything else then for ensuring social stability in society.

It might be a small detour to take, but in essence my point is this: The things we celebrate as being innovations and creating value are really the opposite. A lot of it is piggy backing on extracting value that already exists other places while creating nothing meaningful new, and the end result is that while it undoubtedly leaves a few better off, it leaves more worse off. That’s not a winning recipe long term. It is a race to a bottom, you don’t want to reach.

So the question then really becomes how we might work to change this dynamic? How do we get from celebrating the gold calf into innovating in a way that is not only positive in itself but net positive for economic growth and with that society itself?

We need to get back on the track where innovation is about creating breakthroughs that unlock new kinds of value instead of sucking existing markets dry. We need to come up with technologies that create new markets that can in essence function as amplifiers of new markets.

For startups this means that instead of looking to disrupt someone already there and try to get their slice of the cake, the focus should be on how to ensure that the cake itself gets bigger, and whatever is added to said cake the startup in question will be well positioned to grab its significant share off.

Doing that will surely require a vision above and beyond 99,99 % of all vision statements ever presented by startups or corporates. But think about the opportunity? Think about being the innovators edition of Christopher Columbus setting sail to find something that no-one has found before only to end up with far more than what you were able to imagine, you would ever find?

We need that kind of imagination to replace the fighting for scraps in areas we already know really well. We need this to get a situation, where innovation is a net positive of a more significant nature than used as a cover up for ideas that could in essence very well be net negatives for all.

I’ll be curious to see who sets the standard first, and what kind of vision could emerge from this.

(Photo by Daniel Chekalov on Unsplash)

Always stay alert

Just because you have made it once, doesn’t mean that you have made it forever.

Just as you replaced an incumbent by delivering a better, smarter, cheaper or whatever solution to your customers pains, somebody else could come in tomorrow and do to you what you did to them.

Just as you worked tenaciously to get to where you are today and be successful, numerous other players are plotting the same way against you as we speak.

So always stay alert. Always be ready to change and transform what you’re doing in order to stay ahead.

The second you stop doing that you risk becoming a lame duck.

(Photo by Advocator SY on Unsplash)

Needed: New breed of digital health tools

So far we have been used to medical breakthroughs in treatment of various conditions in terms of new medicines, where a new pill can be the solution to serious conditions and ailments of various sorts. The new and highly successful obesity drug from Danish manufacturer, Novo Nordisk, is just one example.

But every time a new drug pops up, questions are raised: Wouldn’t it be better to preempt the condition – if at all possible – rather than wait until it occurs and then try to provide medical treatment against it?

Some of those arguments go towards thinking of digital services and tools as a way of being more preemptive and over time reduce the need for often very costly medical treatment. The thinking is that we have the ability to provide tools and services of such a quality that it will efficiently be able to support or even replace doctors looking to preempt serious health conditions.

The argument does have some merit. We do indeed have a lot of knowledge about how to prevent things from happening, and we also have the most basic abilities towards putting those ‘recipes’ into digital tools and services. Yet, we still seem to fall back on high hopes for new drugs and treatments.

I think there is a very good reason for this; preemptive treatment while making a ton of sense is super, super hard for the patient. Think about it for a second: There are limitless examples of people trying to preempt a condition with the support of doctors, coaches, dietitians and whatever, and most of the time, these people still don’t succeed. Often because of the lack of stamina.

Thus I think it’s about time to start thinking about the next generation of digital health tools and services. This will be tools and services that should not only be looking to repackage what is already known about how to prevent certain conditions from occurring. They should also – and perhaps even more – be about how to grow stamina in the patients to help them succeed with the preemptive project so to say.

Until we have digital health tools and services that cater for those more psychological factors in more profound ways, I don’t think digital will play the pivotal role in keeping future costs of medical treatment down that many – including myself – would love to see.

(Photo by Luke Chesser on Unsplash)

Go challenge success

Often when we think about which new projects to pursue, we have a tendency to stay away from the ones, where there are already some really dominant players. Because we have a feeling that we will ultimately come up short.

But is that always the case?

What happens when someone you know from a successful company tells you that pursuing your idea or project within his space of operation is a futile endeavour? Should you just roll over and die without even trying?

Or should you – on the contrary – feel validated in your perception that you could really be on to something?

Because at the end of the day why does your friend with insights want you to stop?

Yes, it could be because the idea is really stupid, and of course you should always do your own due diligence on it.

But it could also be because he’s nervous that you could be onto something that is going to potentially upset the status quo and come back to haunt him and his company.

After all – as Mike Shapulski puts it here – the best project is the one that threatens success.

(Photo: Pixabay.com)

Cakes, laptops…and news

Despite every intention otherwise, I keep returning to commenting on the industry, where I got my education and served a significant part of my career:

The media industry.

I just can’t escape the fact that I get almost emotional every time someone within the industry makes an argument that only serves to prolong the suicidal pain, the industry is putting on itself by not squarely facing up to the real market realities they exist within.

Latest example? Paywalls. Or rather; the customers lack of love for them.

Whenever a new survey comes out indicating that customers don’t want articles behind paywalls, you will hear a version of this argument from the industry:

“Oh, but this and this industry also has expectations that you pay for what they are offering”.

I have seen a lot of analogies for this with laptop-resellers and bakeries being just the latest. So let’s latch onto those and just briefly examine why this analogy is both flawed and – ultimately – downright stupid:

No matter if you went into a computerstore or bakery back in the 80’s or even today, there has always been a constant: The merchandise was sitting on the shelves with a nice price tag onto them, and the ONLY way you could get to walk out of the store with something in your hands was by forking up the cash to pay the price on the tag (or haggle yourself to a slight discount, but that’s beside the point here).

How about in the media industry?

Through 20 years the media industry have said to people coming to their ‘store’, aka news websites: “Look, everything here is free. Just feast yourself to your own delight.”

That advertisers paid for the privilege of offering the product to customers for free was a point lost on the consumers. To them it was just great that they could get something without paying directly. Who doesn’t like that idea?

Fast forward to today. Media entities are now busy putting (much needed and long overdue) paywalls up.

Now, naturally when you start demanding something from your customers in the way of payment rather than just offering it for free, a chunk of your customers will object to it. After all the feeling is that you’re talking something away from them.

But trying to reason that argument by comparing it to other industries, where you ALWAYS had to pay out of pocket is just misplaced. It’s like comparing apples to cheese.

And where it IMHO gets downright stupid is that as long as media people insist on blaming the customers that they just won’t all accept the change, the more time it will take for these same media people to focus on the things they need to do from their end to get out of the misery they’re in:

Developing the product into something customers find it natural to pay for, because it has that value to them.

As hard as it is in reality, as basic straightforward solution it is.

It is the only way this industry will ever be able to move out of this quagmire they’re in. And if blatantly stating when they are misusing their time on worthless arguments can help push things in the right direction that alone is a reason to keep on bringing it up and commenting on it.

Only trouble with that is that I am not confident they will ever really understand, let alone accept, it. Which probably also means that this won’t be the last time I feel the strong urge to comment on it…

(Photo: Pixabay.com)

Igniting change

When you try to affect change and solve a problem in a new way, you need them to be ready to give up how they have done things in the past. Or get them interested in forming a new habit.

For some things it’s easier than with others. If you’re just presenting a more efficient solution – aka a faster way of getting from A to B – it’s (all other things being equal) easier to facilitate this change than if you’re trying to create improvement for people, who have been used to ‘nothing’ being the norm before.

Turning those around is tantamount to start setting expectations in a space where none may currently exist. It is like going from 0 to something and foster some kind of accelleration from a point of standing completely still.

You may very well only get one – or best case a few – shots at making it happen; getting from stand still to some sort of motion in the right direction. But if you get there, you (by and far) have it made.

But getting past this initial barrier – get the engine started and movement commenced – is your biggest headache. How to make it happen? How to make sure it happens, if it doesn’t happen in an instance? And – to some extend – how to keep the engine on and the wheels in motion.

In these cases disruption of the status quo doesn’t happen somewhere down the line. It either happens straight from the bat or maybe not at all.

It’s actually quite scary. But at the same time hugely motivating.

(Photo: Pixabay.com)

Is disruption dead?

Not at all. It is just not something we talk about in the same way as we did only a few months ago.

Disruption has moved from the rostrums, talks, columns and what have you and from people who basically have little idea about what the notion means to the lab, the office, the daily grind, where experienced brilliant people are working at it instead of talking about it.

There is nothing new in that. Far from it actully. We have always been like that: Faster, longer, higher. It is an anxient phenomon; always looking to improve and – at best – with a significant margin. It is just human nature. And it’s best left to action rather than babble.

(Photo: Pixabay.com)