We are currently living in an era that is hyper-disruptive and the pace of that disruption is significantly increasing because the environment is now much more conducive to disrupting existing modalities and ecosystems.

For me, that is evidenced by the ongoing rate of change we are seeing in…… so many industries, that I wouldn’t know where to begin. There’s a universality associated with disruptive environments. At the core of it a business builds an economic construct around a certain set of conditions or certain value proposition sets, and then all of a sudden that model is disrupted and a new way of doing things arrives, or a better way of doing things arrives, and in a period of time – short, medium or long – that new way of doing things achieves dominance, invades the ecosystem and leaves existing players to ask: “how do you change the wheels on your car when you’re on the highway?” That’s enormously difficult to do.

It’s a huge amount of cultural change and that is why it has to start from top. You must set a mandate and you must be willing, because inherent in disruptive environments is that you don’t always know the next new thing – so there are always going to be failures. For the CEO and the Board it is an existential crisis: they (the Board) have to face the fact that their current model has been disrupted. Then you have to embrace this notion of how you re-architect and almost disrupt your own model. Without that alignment it doesn’t really matter what you do because if you have factions in the business – with some supporting the move to the new world and some supporting staying with the status quo – you get these internal battles which just makes things worse.

However I recognise it takes an enormous amount of courage and it is hard to pick the right moment.

In a sense you have to emulate what start-ups are doing – if you don’t have that alignment and courage that starts at the top it just won’t work. Once you have that there is still no guarantee because you still have to reinvent your whole business model. But at least you have a chance. Start-ups don’t have any baggage. They have an environment where they might throw 10,000 seeds on a field and only one or two germinate – that’s a start-up environment. Whereas incumbents don’t have that luxury, they have to maintain a certain revenue stream while simultaneously reinventing themselves.

I like to say to the people I work with, particularly younger people, that they are living in the age of disruption. When we look back 100 years from now they are going to look at this era and say “this was the age of disruption”. What’s happening in technology first started there but now it has been propagated into every industry.

Today all of the industries that thought they had safe harbours, they are ripe for disruption. Look at what Apple or Google are doing to the banking industry or the auto industry – or what they are about to do. The jury is out as to whether or not they will be successful but I would certainly say that these traditional industries thought they had models of operation that were safe and stable.
That is their Achilles heel, because the disruptive players will say that gives them an advantage because some of these industries are asleep at the wheel.

For me, it’s the maturity of the technology platforms that allows for anyone to do anything in different industries – and you don’t have the old barriers to entry like capital and regulation. Every industry is going to enter its own disruptive phase so you might as well get good at managing through it.

For example, if you are building keyboards and smart phones and you think you have a business around that and all of a sudden touch screens became the thing, by the time you realise that you have to embrace that then typically it’s too late and you have to look at where it’s going next.

You can’t swim to the place that has already been disrupted because by the time you get there your rival already has it covered; you have to think about how to disrupt the player who has just disrupted you.

In the newspaper industry I work, for 150 years it was essentially a vertically integrated monopoly that had a massive revenue stream around print and print advertising. Then the Internet came along and created an environment that was ripe for disruption because the Internet breaks the distribution monopoly you have around content creation. Now anyone can create and publish content.

Out of that came Google aligning advertising around search and from there you have players like Facebook, Snapchat and so on and increasingly the revenue migrates to these platform players as they have a new and better way of reaching audiences than the old system was able to provide.

I spent over a decade at Blackberry and within seven years we completely disrupted the mobile phone industry and we ate everyone’s lunch; and then in another three or four years we had our lunch eaten. You see it with Google, which is looking over its shoulder at Facebook which is looking over its shoulder at Snapchat... just by the fact that you can disrupt an entire industry the same preconditions allow someone else to disrupt you.

 

 

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Andrew MacLeod

Andrew MacLeod is Chief Commercial Officer at Postmedia, one of the largest newspaper and media conglomerates in Canada

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