From My Perspective

When Disruption Doesn’t Work

Business disruptors rule — or so we’ve been told. And while disruption can pose threats, it can also provide opportunities.

We all know the stories of upstarts such as Lyft, Airbnb, Houzz and Bitcoin. Transportation, hospitality, retail, currency and more: There are disruptors operating in nearly every sector.

But just because there is
calculated chaos in any given arena
doesn’t mean the upstart is destined
for success. Legacy organizations have outwitted disruptive rivals regularly, with new products, new services and new business models of their own. There are numerous success stories of companies that defended their turf and even grew in the process.

Remember when MP3 downloads were giving the music industry fits? Steve Jobs connected the technology to his computers via something he dubbed iTunes, throwing a lifeline to the music business and making tidy profits for Apple in the process.

Nestlé designed its Nespresso machines to make quality coffee at home — going directly after Starbucks — and has sold billions of capsules of coffee worldwide.

Another example? Walmart versus Amazon. If you thought the brick-and-mortar behemoth would roll over for the online giant, think again. It is currently matching Amazon blow-by-blow — the latest battle is over home delivery — in a fight that’s far from over. The “clash of the retail giants,” CNBC calls it. Stay tuned.

This we do know: A slow, non-aggressive approach to disruption can end in disaster. Traditional railroads all but gave up when airlines and highways took their passenger-transport business, rather than giving customers compelling reasons and features to stay on the trains. (Today’s high-speed rail is another story, entirely. Airlines fear the rise of those — and even lobby against them.)

Netflix, Redbox and video-on-demand played roles in Blockbuster’s demise. The fact that the popular movie store didn’t explore rentals-by-mail or streaming until too late in the game proved to be its death knell.

Clearly, there is no right way to respond to every disruption — and it doesn’t spell disaster in every situation. Imagine a disruptor is coming for your business. That’s a good way to think — every day.


ROBBIE BRIGGS, President and CEO

As seen in the Wall Street Journal’s Mansion section. 

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