Strategic initiatives are tools for achieving industry leadership positions, or for defending leadership positions. Strategic initiatives are game-changing programs. In this article, I explore some concepts that will challenge your assumptions, and make you a better strategic thinker.
1. You’re either an incumbent or a disruptor
Over history, very few institutions have held together. Those that have sustained have had to adapt: churches, governments, militaries, etc. Technological change and social change and environmental change are just a few of the causes of this disruption. Given that, I offer these propositions:
- A mature organization is usually an incumbent, and is vulnerable to disruption.
- Any organization has the potential to disrupt other organizations.
2. Incumbents are disrupted when their attention is elsewhere
Distractions are a problem. I’m reminded of Tolkien’s Lord of the Rings Trilogy. Sauron’s evil eye scans across all that can be seen. A small party (Frodo, Samwise, and Gollum) are sneaking right into the heart of Sauron’s power. Sauron’s eye occasionally notices them, but events elsewhere distract the eye. In the end, Sauron is destroyed – disrupted – by the small halflings. They were noticeable, but the incumbent power did not pay attention. Here are three more examples:
- Kodak invented digital photography, but was unable to exploit it as it kept focus on traditional film-based technologies
- Xerox invented many of the technologies that are now common in personal computers, but failed to exploit
- Microsoft missed opportunities that were later exploited by Google, Facebook, and others
Stated differently, lack of attention to small existing forces allows disruption to sneak into your incumbency.
3. Disruptive innovators have open minds and open objectives
Innovation happens when a “hub” brings together disparate knowledge networks. Christopher Columbus’ time in Lisbon during the 1480s was critical to capturing all of the necessary elements of a strategy to sail west across the Great Sea to open new trade routes.
Thus, an important idea of disruption is that there is an unpredictable, serendipitous nature to it. It occurs at the micro level, when an individual (actually, it is more commonly two or more individuals) notice something interesting. That interesting thing sparks an insight.
Here is what does not work:
- Predefined and narrow objectives for deliverables.
- Keeping people in silos
- Asking the same questions (or even worse, asking no questions)
4. A disruption life cycle exists
Steven Sinofsy points out that disruption has a lifecycle pattern:
In the first phase, the potential disruptor introduces a new point of view for achieving a task: it is generally a simpler stripped down product that might be at a lower price point. Although incumbents generally notice the new entrant, they offer only a tepid reaction. I should point out that we only know something is truly disruptive in retrospect.
In the second phase, the incumbent now notices the product but continues to compete in uninspired ways, claiming “here’s how and why we’re better.” The disruptor gains strength, and competes on more dimensions (for example, more than price). It is now an established competitor with a unique and evolving value proposition.
The third phase is one of a new equilibrium. The incumbent and disruptor have parity.
The end game, which may take many years, is where one of the parties retreats and/or one or both parties enter into a new “blue ocean” space to practice a new kind of disruption.
5. The strategic initiative leader and team have important responsibilities
Too often, strategic initiative leaders function as program managers tracking and following up on the projects and the deliverables, and communicating to the stakeholders. Sometimes they are even more aloof, simply acting as executive sponsors.
A strategic initiative leader needs to keep the incumbency-disruptor question high in awareness: which one are we? Another important question is one of patterns: are we seeing small put salient signals? Are we ignoring important things?
And, of course, the leader can’t do it all by himself or herself. The team of people who are in tune with the situation and who fell empower is also an important part of the pattern of disruption. We don’t know when disruption will strike.
Do you agree that disruption has patterns? Do you agree that the strategic initiative teams and leaders need to be alert for small signals?