Wayne Norrie calls on New Zealand businesses to embark on 'disruptive innovation' in order to grow in the fast paced digital environment.
Disruptive innovation entails creating a new market and value network, as well as eventually disrupting and displacing an existing market and earlier technology.
"The key is to have an outward focus, instead of inward looking focus," says Norrie, who spoke at this year's Institute of Directors (IoD) Leadership conference.
For today's enterprises, it is "disrupt or be disrupted," states Norrie, who chairs the Hi-Tech Trust and the beachhead program of the New Zealand Trade and Enterprise. "It is so easy to become yesterday's rooster to today's feather duster."
"It is a scary world out there, but you can stop being a victim of disruption," he adds.
"If you are thinking local, you are in danger of being blindsided."
"You have to work out what you do has to be globally competitive and unique; you have to add value and be able to operate in a global market."
"What is your core competitive advantage? What is your unique IP, or do you have a lot of baggage that you carry with you?"
"Transforming the company's core business is extremely difficult and requires leadership and courage," he avers. "Foresight is not enough."
What is your core competitive advantage? What is your unique IP?
He cites the case of Kodak, which declared bankruptcy in 2012. Yet, it had identified, as early as 1979, digital photography as a possible disruptor to their business. "They had 33 years to do something."
Netflix, on the other hand, went online and cannibalised its own model of DVD by mail, its core business, "to leapfrog the rest of the industry. "
"It takes courage to kill your own cash cows."
"You need to think about that, because I guarantee you, your competitors are," he stresses. "When you are not thinking about it, that is the time you are more vulnerable."
"Disruption is everywhere, if we start to open our eyes to it," Norrie says.
He poses some ideas companies can consider to determine if their organisation or industry is among those being disrupted.
Old patterns: Look for industries that do same patterns for many years. He cites Uber and Zoomy, the local taxi booking app, for disrupting the taxi industry.
On premise: These are industries with big investments in physical buildings -- think of universities. He then notes Coursera, which is now offering free online education delivered by academic institutions including Stanford, Princeton, and Yale.
Local views:Industries that think locally and think they are too far away give them the benefit of distance. He says Vidyo is challenging the videoconferencing industry that provides "mind-blowingly good, but mind-blowingly expensive" services. In healthcare, the service can be used for doctor and patient interactions.
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