How Disruption Is Changing the Business Landscape
- Business Tips, Startup 101

How Disruption Is Changing the Business Landscape


Companies continue to innovate and grow by finding new solutions and reaching untapped markets. Promoting an idea that contradicts conventional wisdom can be risky, but that’s how some of the greatest inventions have come into existence.

From Apple to Amazon, former no-name startups capitalized on an itchy disenfranchised customer base to find alternative solutions to their problems. By using a disruptive model, these companies have uprooted entire industries.

Being a disrupter can be tough, but there are also plenty of upsides.

What is a disruptive business strategy?

Disruptive business models refer to an organization implementing new strategies to improve or change an existing business model. Innovative companies use these models to create and develop new markets that can eventually uproot established companies.

Disruptive companies respond to customer demands that leading suppliers and manufacturers in the industry have ignored. Alternative products and services are offered that challenge the status quo and pave the way for new industry leaders to use the disruptive process.

David Edelman, an analyst at McKinsey and Co, defines market disruption as “a profound change in the business landscape that forces organizations to undergo significant transformation rather than regular incremental change.” Historical examples include revolutionary inventions such as the steam engine, the railroad, the telegraph, the automobile, the assembly line, and the telephone. 

Each of these innovative stepping stones has disrupted traditional business practices. Those quick to seize their potential become new leaders, while those who stubbornly cling to their old ways can fall through the cracks.

Examples of Market Disruption in the Business World

More recently, business disruption has taken the form of the advent of the mainframe, minicomputer, PC, Internet, and cloud. As a result, AOL, Blockbuster, Yahoo!, Radio Shack, Compaq, and Borders have failed due to their unwillingness to adapt to technological changes driving e-commerce and new retail or consumer trends.

Market disruption does not only apply to the consumer sector. The airline industry, for example, has seen many companies disappear due to rapid change. These airlines include Pan Am, TWA, Virgin America, Swiss Air, US Airways, Air Berlin, and Air Australia. A stubborn refusal to deal with disruption, a few mismanagements, and an industry juggernaut can perish.

The Challenges of Industry Disruption in the MRO Sector

Disruption is a serious threat within the MRO space as well. A multitude of technological factors, such as digital transformation, the Internet of Things (IOT), machine learning, artificial intelligence (AI), machine learning, predictive analytics, and additive manufacturing (AM), drive rapid changes. Attracting the skill sets and building the infrastructure necessary for successfully implementing these technologies is no small feat. Those who master them effectively will be the ones who lead the digital charge into the future. However, leaders should sometimes be wary as it is easy to lose sight of disruptions’ impact on their business.

According to McKinsey, it is important to determine how to integrate these trends into an overall strategy and improve decision-making. In many ways, the problem is worse for MRO executives due to the multifaceted nature of disruption in their industry. Multiple technologies are bringing real change to all aspects of MRO processes and workflows, but digitalization also comes with waves of disruption. In addition, OEMs are also invading the MRO space, leading to consolidation. However, it isn’t easy to effectively consolidate many systems and technologies without a comprehensive look at the technology platform.

Respond to Unmet Customer Needs

If an industry has used a standard, general approach to meeting customer needs, it is likely that some needs have not been met.

Shaking up a respective industry by taking a non-traditional approach tends to appeal to disenfranchised customers who want an alternative solution to a problem. But, on the other hand, by challenging industry norms, disruptors can increase their customer base or create a new niche market.

At a recent business conference, many speakers on disruption suggested that disruptors focus on attracting a small, untapped market rather than trying to steal customers from established businesses. By doing so, disruptors can be flexible in offering products and services.

Dissatisfied markets are more receptive to new solutions because they have been ignored and neglected by established companies.

Startups versus existing companies

Startups are generally more willing to implement a disruptive business model because they have to prove that they can offer an alternative solution that larger companies do not provide.

However, many business gurus suggest that established companies can also use a disruptive business model due to their large budgets, additional resources, and name recognition. The real challenge is figuring out how to do it without losing its customer base and mainstream status.

It’s a bit of a Catch-22. Startups have a big hand in using disruptive business models because they are forced to set themselves apart from industry leaders.

Yet startups lack the resources or name recognition established companies do, making disruption more difficult.

How Disruption Is Changing the Business Landscape

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