Innovation or disruption?

Disruption has become something of a buzzword today but there is a difference between disruption and innovation says Alison Coleman in the Telegraph.Since the arrival of Uber, Airbnb and Snapchat – brands that turned their industries upside down – disruption has become something of a buzzword in business circles. However, while businesses need to innovate to survive, do they really need to disrupt? And do they really understand the difference? Simply put, innovation is rational whereas disruption is irrational, says Shilen Patel, founder of business accelerator Independents United. He explains: “Hailo applied technology using a very rational set of rules to achieve innovation, whereas Uber’s irrational mind-set asked: ‘What if I could get everyone in London to be a taxi driver?’ They then applied technology to achieve that. Hotels.com is rational, Airbnb is 100 per cent irrational.” Smart companies recognise disruption is inevitable and adopt it as an active business strategy. The challenge is deciding how to manage it How does a business decide whether it needs to innovate or disrupt in order to stay ahead of the curve and the competition? Patel says: “Entrepreneurs or corporates need to ask themselves two questions – first, is their category facing large-scale unpredictable change, and second, how much control do they have over that change? If you have control then you don’t need a revolution – you can innovate. If you don’t have control, you need to get to revolution before someone else does. As Mark Zuckerberg said: ‘If we don’t create the thing that kills Facebook, someone else will’.” But, according to Kirsty Maxey, managing director of Teamspirit PR, disruption and innovation are far from mutually exclusive. In fact, they should be seen as increasingly close bedfellows. She says: “Smart companies recognise disruption is inevitable and adopt it as an active business strategy. The challenge is deciding how to manage it – the choices range from it being the marketing department’s role, to it requiring a dedicated percentage of all staff time, to nurturing organic units while retaining a financial stake. The real cost for businesses is in doing nothing.”Still, disruptive innovation needs organisation, not just wacky ideas. Many businesses, knowing they have to embrace disruptive innovation, make the mistake of having a small number of rogue individuals shake things up. The ideal solution is having a team tasked with disruptive innovation, says Tim Taylor, founder of leadership consultancy Making Great Leaders. He says: “The winning idea may come from one person in the ‘disruptive ideas team’, but the rest pull together to bring the elements that make it possible – from research to technological capability to market assessment and organisational change. Their job is to take a crazy idea and make it believable, tangible and deliverable.” They also need to know when the time is right to disrupt. These times tend to be when growth is looking the same, profits and revenues are steady or in slight decline – or when the market is converged, and, increasingly, when the technology is there to make it happen.