There is a popular business mantra now popularly accepted known as “Disrupt or be Disrupted”. This refers to business models of players such as Netflix which disrupted the hegemonies of the traditional industry leaders, or even killed competition as happened with Blockbuster in this case. There may however be cause for concern as some business innovations may not have the transformative effect sought. So, a cause-benefit analysis needs to be considered. A matrix could be created to highlight these costs and resultant benefits. The axis could be divided into high or competitive intensity and high or low asset requirement to the traditional business. To discuss specifics, in the retail industry for those with high asset worth across multiple stores such as Sears or JC Penney, this may not be a very valuable proposition. Instead, such self- disruptions will be beneficial to luxury retailers like Gucci or Louis Vuitton. Sometimes alliances can work wonders which is why GM is tapping in to the potential of Lyft. Microsoft meanwhile has already leapfrogged to the next stage thanks to its already substantial data warehousing capabilities. This gets leveraged using cloud-based software for software development and customer relationships.

Source:https://hbr.org/2018/11/research-self-disruption-can-hurt-the-companies-that-need-it-the-most

Uploaded Date:08 November 2018