In order to better understand lateral disruption, you must first understand the capability you’re delivering, not the technology, said Alexander, who explained, ‘People don’t buy a product or technology, they buy what it enables them to do.’”
Most innovators know far too well the lessons taught in Clayton Christensen’s book, “The Innovator’s Dilemma.”
If you have too much hubris, or you simply don’t pay attention to market activity, no matter what size you are, you can and will be disrupted.
In the age of digital everything, disruption can potentially happen from anywhere. It can come from industries you never fathomed could ever be competitors.
“There are a lot of opportunities for technologies to move laterally. So, something that you think is irrelevant to your market segment, develops to the point where all the sudden, that capability actually overlaps with what you provide,” explained Jeff Alexander in our conversation at the 2018 IRI Annual Conference in Atlanta.
We see this most often when companies evolve their business models, not necessarily their technology. Just take a look at the entertainment space and you’ll see a host of companies evolving their portfolio to include products no one thought they’d produce. Amazon is now in entertainment, competing with TV networks, film producers, HBO, all cable channels, and now also Netflix and Hulu.
In order to better understand lateral disruption, you must first understand the capability you’re delivering, not the technology, said Alexander, who explained, “People don’t buy a product or technology, they buy what it enables them to do.”
A great example is the car. Car companies never thought of themselves as competitive with taxi companies, but now that Uber and Lyft solve the problem simply of getting around, car manufacturers are now actually competing with ride sharing apps. A car helps you get around and so do those apps.
“It’s really understanding what is the core value that I’m providing to the customer? What’s another way that somebody can deliver that same value? Who’s got a complimentary technology that can be shifted into that market space or to fulfill that need,” said Alexander. This is the innovator dilemma that is being faced.
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