How an Incumbent Business Can Act Like a Disruptor

February 9, 2018 | Tom Bernot


Today’s formidable digital world has transformed the competitive landscape. Competition can come from any market, not just the industry vertical your business traditionally plays in. In fact, in this new digital era, the word “traditional” should be banished from your organizational mindset. When disruption is embraced as an opportunity, nimble businesses can undergo a Renaissance of long-term stability and growth as they implement change from the inside out.

But how can this change be embraced when the business climate continues to evolve at lightspeed? Some executives question if they have the internal resources to keep up. At the 2017 World Economic Forum, global business leaders admitted the speed at which disruptive digital natives move make it particularly difficult to predict who your future competitors will be and what will be required to win. After all, early startups like Amazon and Facebook have become intimidating forces across several different industry verticals seemingly overnight. How can long-established businesses compete – or even win – in this new market in which rules seem to no longer apply?

Disrupt Yourself First

The first area your company should disrupt is itself. Identify internal change agents who can recognize organizational strengths and opportunities. Building a leadership team specifically dedicated to reimagining your business’s culture with digital at the core will hold your transformation efforts accountable. Siobhan McFeeney, Vice President for Transformation at Pivotal, says “culture is behavior, it’s not just what you say.” If you want internal innovation, you are going to have to restructure the company, embracing new metrics of growth. “Small teams, highly accountable, but autonomous,” she said. “That requires trust.” But that’s what the digital natives do so well.

Enterprise organizations often have a difficult time implementing change due to deeply entrenched bureaucracy. Companies that get support from the C-Suite early on have much higher chances of effecting true change and competing with the industry disruptors. Barriers to innovation should be removed or quickly corrected. After all, organizational change involves everyone in the organization.

Capitalize on Employee Optimism

It’s necessary to communicate long-term strategy to employees and stakeholders while articulating the necessary steps the organization needs to take to move forward. In the initial phases of digital revisioning, it’s paramount to get your employees on board. You may find digital advocates who are more than willing to jump in and get their hands dirty, despite not being in a traditional leadership role.

According to a recent report from Altimeter, The Digital Change Agent’s Manifesto, these digital change agents are “exceptionally passionate, informed, and experienced in digital and its impact on business and markets. They're going out of their roles to try to send that message up the corporate ladder.”

Capitalizing on this employee optimism for digital transformation can go a long way in actually altering the way your organization competes against disruptors.

Buck Bureaucratic Habits

Large-scale organizations cannot alter their business models as nimbly as a startup can. They’ve lost the ability to drive rapid innovation due to their size, slow-moving processes, and perhaps even outdated priorities. It can be daunting to initiate change when various rounds of approval are required from several individuals over months at a time. Simply put, bureaucracy could be the toughest barrier to overcome for businesses seeking a digital transformation.

David Wadhwani, the CEO of AppDynamics, states that “Senior leaders need to understand that hanging on to the status quo is a bigger risk than embracing change.” Even though your business model may be successful now, will the old way of doing things continue to drive profitability five or ten years into the future? Businesses must take their strategic advantages, whether it’s their talent, product or price point, and discover how digital supports that advantage. If that strategic benefit isn’t clear, digital could be the missing opportunity. Planning for the future solidifies stability. This is one advantage that the leaders of an experienced enterprise should recognize, where a startup may neglect planning for the future for the harvest of the present.

Take John Deere, for example. This centuries-old organization created the John Deere Technology Innovation Center, dedicated to assisting farmers with their operations with state-of-the-art technologies. The business works with university students to develop and implement new innovations, such the MowerPlus App that relays real-time statistics to users during the lawn mowing process. John Deere embraced potential disruption as an opportunity for renewal.

Pivot for Growth with Agility

When it comes to determining your strategy to thrive in the era of digital disruption, setting the tone of urgency is vital. At the same time, while you must move fast, allow for flexibility and course-correction as strategies are tested and implemented across the organization. Strategic orchestrators, like Falls Digital, help businesses navigate the complex digital ecosystem.

Digital disruption is unique to every business and market, but this not mean you should sit still. More than ever, companies must be agile and have the flexibility to adjust to dynamic markets. By leveraging your enterprise experience but sourcing inspiration from the startups and digital natives, any business can undertake a successful digital transformation—so long as the corporate mindset is ready to be disrupted as well.

Topics: Digital Transformation

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