Keynote by Whitney Johnson on “Disruptive Innovation” at India’s National Competitiveness Forum.
Change is necessary, and even desirable, but most importantly, it is inevitable. What can be hard is when it happens so fast it feels like it is happening to us and not for us, and that is scary. It does not need to be that way. The theory of disruption that we apply to products also applies to people. The theory states that when we pursue a disruptive course, our odds of success are six times higher and our revenue opportunity 20 times greater. To be successful, we do not cope with disruption, but harness its power, its unpredictability to propel us forward and not just our company.
Disruptive innovation follows a framework. The disrupter secures a foothold at the low end of the market. Initially, its products are inferior, its position is weak. Market leaders rarely bother. For example, Toyota beat the market leader, General Motors. They were too small for General Motors even to notice them. Once a disrupter gains a foothold, it too is motivated by the bigger, high-value products. Personal disruption is about taking all of these ideas and making them meaningful to yourself.
One of the first steps in understanding disruption is to recognize that a disruption itself is unpredictable. But we like to do things with the expectation of certain outcomes, so when months or even years of hard work amounts to little, it is unsettling. We use the S-curve to help us gauge how quickly an innovation would be adopted. It helps make the unpredictable predictable.
The theory states that when we pursue a disruptive course, our odds of success are six times higher and our revenue opportunity 20 times greater.
At the outset, growth is slow. Once a tipping point is reached, which is typically 10 to 15% of a mark, you enter hyper-growth. At 90% or saturation, the growth tapers off. These insights also apply to people. The S-curve math tells that growth will be slow initially. It will feel like a slog, and knowing that it is supposed to be slow helps avoid discouragement. As we
put in the days, weeks and months of effort, we accelerate into competence and engagement. This is the exciting part of the curve where all our neurons are firing. It is the sweet spot. As we approach mastery, things become easy, but because we are no longer learning, we get bored.
Our research tells us that one can build an organization that can innovate, an organization that can manage through change by optimizing their S-curves, by having at any given time 15% of their people at the low end of the curve, 70% of the people in the sweet spot and 15% of the people at the high end of the curve. In fact, one can find out if they are about to get disrupted by simply taking the pulse of their workforce. If too many people are in the mastery stage, the organization is at risk, because most people in the organization are bored. Bored and complacent people do not innovate. They get disrupted.
We cannot handle internal pressure. When change comes, we feel under siege. We do more of what we have been doing hoping to resist what is pounding against us, but if we have the courage to do more of what we have not been doing, this is where inability to handle internal pressure can work in our favor. Leo Tolstoy once said, “Revolutions are an attempt to shatter the power of evil by violence. [We] think that by hammering upon the mass [we] will be able to break it into fragments but this only makes it more dense and impermeable. Disruptive movement must come from within.” So, how do we disrupt ourselves? There are seven levers in the framework of disruption.
The first is to take the right kinds of risks. There are two kinds of risks- competitive risk and market risk. Competitive risk when applied to people looks like a big job or huge opportunity, where one has to just figure out how they can compete and win compared to the 10-15 other people who want that job. Market risk is not knowing if there is even an opportunity, but there is a problem which we think we can solve. Given that a lot of the jobs that are going to exist in 15 years do not yet exist, they have not yet been created. Market risk is about creating the market, creating the opportunity, and having the will to play where no one else is playing.
If there are not enough constraints, we need to create them because we need that friction to climb up the learning curve.
Secondly, it is also important to play to our distinctive strengths, the things that we do better than other people. Often, we are not aware of our own strengths, and we certainly do not use them. The clue to finding them is to notice what are the compliments we dismiss. The frustration of genius is believing that if it is easy for me, it must be easy for everyone else. People tend to overvalue everything they are not and undervalue what they are, which is why our superpowers are not in our resumes. This leads to people getting hired for positions then are not fit for. In order to fly up the S-curve, it is essential to bring our genius to work, make sure the people who work for us bring their genius to work and then play where no one else is playing.
Number three, embrace your constraints. If there are not enough constraints, we need to create them because we need that friction to climb up the learning curve. When resources are at a minimum, we get scrappy. This is when we tap into our distinctive strengths and because the doors that we all want to walk through are closed, we build our own door. For disruptors, constraints are not a check on absolute freedom. They are a tool of creation.
Number four, battle entitlement. The more successful we are, the more we think we deserve our success. At that very moment on the curve when we have all the cognitive, intellectual, emotional and financial bandwidth to question what we are doing to disrupt ourselves, we instead say that this is the way things will and should always be.
One aspect of battling entitlement is a willingness to step back. We crouch before we jump, we bring our fist back to punch. Personal disruption involves moving sideways. It involves moving back. A step back from work, from our entitlement is an opportunity to grow. It is a slingshot. That slingshot might be failure. Whenever we start something new, there is a fantasy of the simple linear world that working hard leads to realizing our dreams, but that is not always the case.
When failure happens, we are embarrassed but we are also heartbroken. It is critical to grieve, but after grieving, we need to ditch the shame. By buying into the shame, we allow the failure to become a referendum on us, on our identity and on our sense of self. It is shame that limits disruption, not failure. Whether we see an experience as a failure or success is always a choice. The up and the down are part of personal disruption. Failure is a constraint, a tool of creation. So, give failure its due but choose success.
Lastly, be driven by discovery. As a disruptor, we are in search of a yet to be defined market. We have a purpose but how we will get there is yet to be determined. This probably means that we are going to end up in a place different from our expectation. 70% of all successful new businesses end up in a different place too. We choose an unknown, we play where no one else is playing because we are driven by discovery. This is the framework of personal disruption.
One of the things that the textbooks on disruption don’t tell you is that disruption by definition is scary and lonely. When we leave our comfortable perch of doing things the way we have always done, there is a loss of identity, a moment of free fall. The puke-to-excitement ratio is so uncomfortably high, it feels like a thrill ride to zero. This is not a signal to stop disrupting, but to know that if you are scare and lonely, you are on the right path. If you have a feeling in the deepest part of yourself that you need to try something new, that you need to let the people who work for you try something new, and you don’t die inside just a little, there is already a dilemma, because whether you innovate or not, there is risk. So, why do we disrupt? It is because when we disrupt, we hunger for a better life. When we disrupt, we become a problem-solver letting nothing stand in our way. When you disrupt, our odds of success are six times higher, our revenue opportunity 20 times greater.
Innovation ultimately begins on the inside. If we want to be an agent of disruption first, we need to become its subject. We start at the low end of the curve, shift into gear to scale, and when we are learning peaks, we do what all great disruptors do. We walk straight into the innovator’s dilemma and leap to a new curve because it is not the companies that disrupt; it is the people who do.