Since 2000, more than half of the Fortune 500 companies have been destroyed by digital disruption.
However, rather than thinking of disruption as a negative word, disruption should be thoughts as an urgent call to action for all businesses.
People who are ‘mechanically’ moving paper/tasks around will ultimately be replaced by artificial intelligence (AI) and automation. There is a need to add creativity into more jobs to make them more satisfying. Essentially, more client-facing people engaging with external audiences and less back-office activity.
The workforce itself will also become disrupted as employee working habits and preferences change. The rise in the gig economy will see employees only apply some of their time to their role with any given company, and they will unlikely want to work 9-to-5.
Who are these successful ‘digital disruptors’…?
Some examples in retail and financial services include:
- Amazon: their share price has grown by 66,000% since they were launched 20 years ago. Viewed as remarkable and smart due to the fact it was built on requirements that had just been developed at great expense by other companies, and then blended to create a disruptive proposition without huge investment, Amazon shook up both the IT and retail worlds at the same time.
- Lemonade: insurance to make life simple; remove friction points including buying insurance and making claims.
- Trōv: ‘Smart insurance’ protecting specific things which younger people care about in a smart app-enabled proposition. Again, removes multiple friction points.
- Atom Bank: A no-branches bank in the UK. App-only, small and very efficient. Regulators are demanding big bank liquidity which is not needed for this model.
To survive, governance and culture needs disrupting
One or two of your Board of Directors should have a digital transformation background. They need to be able to see the world through the digital lens and they will then keep this issue front of mind.
We all talk about acting like a start-up and one way to think in this way is by the creation of a small innovation team to accelerate new products and increase engagement with customers. Collaboration culture is about what you share, it is not what you know that counts. Consider applying an agile methodology in a two-week experimental cycle. If its not working, the project is halted. Create an innovation hub for start-ups so that your organisation can observe start-up cultures and different thinking. If exciting insights appear, you are then able to snap them up ahead of the competition.
Change small things in your company to enable you to start thinking and behaving differently (such as removing chairs and have standing meetings). Change how things feel and anticipate different thinking.
The two “tribes”
The millennial generation are “born-digital”. Older generations are moving towards “going digital”. To achieve a digital organisation, you need to speak and think digital. Whilst millennials do not have the managerial experience or influence, they can provide “diversity of thought”. Organisations need to work hard to ensure both these tribes co-exist, work together and help each other, in order to survive in the age of digital disruption. In two years, buzz words will be common language (e.g. 2FA – two factor authentication which will become vital as hacking will be on the increase).
“Challenge how you make decisions. Disrupt or you will be disrupted!”
