A casual look at a dictionary will show you the destructive power of disruption: Disruption – noun, plural noun: disruptions - disturbance or problems which interrupt an event, activity, or process.
Synonyms: disturbance, disordering, disarrangement, interference, confusion, disorderliness, disorganization, turmoil, disarray; interruption, suspension, discontinuation, stoppage; obstruction, impeding, hampering, spoiling, ruining, wrecking, undermining, retardation
Besides being a great example on the breadth of English language vocabulary, this sounds pretty nasty and who would wish all that on an enterprise?
Well … a Chief Customer Officer for one! Disruption is misunderstood. It is a wonderful thing. It is simply innovation in action, to the benefit of the enterprise, the customer, the economy and more often than not, the planet.
As Software AG’s CEO put it: “Digital disruption is the No. 1 paranoia haunting today’s management teams”, and haunted they certainly are. There are many emerging game changing technologies lurking out there so maybe a little boardroom paranoia is not a bad thing. After all, necessity is the mother of invention.
Blockchain is one example of disruptive technology, and it could take many financial middlemen out at the knees. There might still be some kinks in the chain yet, but this technology has the potential to deliver and to trade trust and value as commodities, between participants, eliminating third party brokers such as banks, credit card companies, or in fact any payment system currently in use.
This also eliminates costs, errors and risk. You can store your wealth yourself and not worry about a run on the bank or anyone being in a position to abuse your trust. The application of blockchains does not stop at the widely known bitcoin but can be extended to the title document of house or land ownership or other records. The point is that a third party that currently holds these records will in all cases be superfluous.
A haunting specter for some, but an opportunity to adopt and harness this technology for others. Many leading banks are not running and hiding from this technology but are investing heavily, reinventing their businesses before someone else does. This is a very healthy attitude and response.
And that is my point – I am not writing about blockchains per se - but on how this innovative technology by definition will drive disruption when it is applied and how smart companies will disrupt themselves before they are disrupted. This was brought home by an announcement by Visa earlier this month and reported in the Financial Times. To quote: “Visa will take its first step towards disrupting the market for payments between banks on Thursday by inviting lenders to test a system for sending money over blockchain…”. Innovation drives disruption and Visa has recognized this.
At the other end of the scale, blockchains could solve that pesky issue about authorizing your fridge to reorder milk or butter when stocks are running low and then losing sleep at night in case it runs amok and orders a year’s supply in one go. Blockchain can solve that, it is a versatile technology indeed, and you can sleep easy knowing your fridge would have to hijack over half the world’s processing power to pull a stunt like that (technical details here).
So an updated definition according to the Eric Duffaut’s dictionary: Disruption: A radical change to an industry involving the introduction of new technology by traditional or new competitors from within or outside the industry that demands new, innovative business strategies or digital business model in response.
Synonyms: innovation in action, unparalleled new opportunities, maximum new business values, global business reach, increased market share, streamlined resource consumption, cleaner air, fresher water, brighter future.
Digital disruption is just digital innovation in action. It makes the inefficient efficient. It reallocates resources, at a macro and enterprise level, to where they can make the biggest bang. It provides answers to the unanswerable questions of our times. It saves lives and improves living standards.
Action must involve movement and change. The only non-option is to do nothing.