Replies to This Discussion

Permalink Reply by Brian T. Murphy on November 23, 2010 at 5:11pm

Hi Peter-

If you're interested in this topic, I'd recommend picking up the "Innovator's Guide to Growth." It is one of my all time favorites, and directly answers the question you are asking.

My advice is to validate you are dealing with a truly "disruptive" business model (discussed in the book). At one start-up I realized I wasn't dealing with a disruptive business model but an evolutionary, which honestly changed the entire course of the business. We spent a lot of money and lost a lot of deals because we thought we introduced a new technology that "disrupted" what folks were doing (pertaining to online marketing), but it was merely a better mousetrap!

Here are a few answers to your question (all lifted from the book, nothing is original to me)-

1. Be David, not Goliath. You will not be able to win customers by offering a better technology or mousetrap. I learned this lesson over a 3 year period by having a better price and technology than the industry competitor but struggling to win new business.
2. You CAN win new business by finding a core group of "non-consumers" that are not using the product because of a number of variables (generally priced out of the high-end solutions).
3. Introduce a totally new way of transacting (examples of this are freemium, Skype, etc).

Hope this helps, best of luck!
Brian T. Murphy
@The_Murfinator

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Permalink Reply by Pieter Engel on December 11, 2010 at 4:38pm

Brian, Rod,

 

Thanx for your replies! (Sorry I haven't reacted sooner!)

The intent of my question is more of dealing as an existing organisation in a market that’s become disruptive than trying to create a disruptive business model. I agree that the latter would be the best bet, but I think (and I wonder if you agree) this would be easier with a new start-up than building from an existing organisation.

 

Please look at my answer below (or above?) to Alex. I hope I make the essence of my question a bit clearer there.

 

Best regards,

 

Pieter

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Permalink Reply by Rod on November 23, 2010 at 11:31pm

Hi Peter,
I've been working on archetypal business models and identified Sustaining and Disruptive Business Models as 2 of 10 Archetypal Models in business (as well as life; but that's another story!).

You could see my list of properties for a "Disruption Spot-Business Model" in my presentation of 5 Archetypal Strategies for Designing Winning Business Models:

http://www.slideshare.net/RodKing/5-archetypal-strategies-for-desig...

What Clayton Christensen refers to as a Sustaining Business Model, I have dubbed as a "Luxury Spot-Business Model." The presentation also covers a "Blue Ocean-Business Model" which resolves the trade-off inherent in Luxury Spot and Disruption Spot-Business Models.


Best,
Rod.

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Permalink Reply by Alex Osterwalder on December 4, 2010 at 9:05pm

Pieter, I'm generally pretty suspicious of general criteria. I think every business model is unique and every sector, industry or business area has its own specifics.

Also, I'm not quite sure what you mean with "disruptive markets".

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Permalink Reply by Pieter Engel on December 11, 2010 at 4:26pm

Hi Alex,

by disruptive markets, I mean markets that are subject to fast technical developments, swift shifting consumer behaviour/attitude and thus great economical uncertainty. At this moment, on might say that we all are operating in disruptive markets, but I think some are a lot more than others!

(some background information: I am active in print and direct-marketing)

 

I do understand the hesitation towards general lists in this case and I do appreciate that every business model is unique, however, I wonder if it is possible to make a checklist of criteria that organisations who operate in disruptive markets can hold against their business models to help them make their model more future proof.

 

What I’m looking for, would be a “checklist” containing subjects like innovation, flexibility, partnerships/outsourcing, etc.

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