The current one is an era of profound and rapid changes, a Disruption Age° in which there is a leap – a breaking point° – compared to the ordinary linear evolution of the Market; and the Business Models are radically transformed (and strategies, structures, etc.).
To deal with this phase strategically effectively – in order to correctly interpret the new Demand° – it is necessary to completely redefine products and Company by adopting Disruptive innovation.
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Firstly, it is crucial to take into account that
disruptive innovation,
the disruptive change is not an option°,
due to the fact that there are two inevitable changes at the base of the Market:
● a radical change in the forms of consumption (customer needs and expectations). <see New modality of Consumerism>
● a “revolution” of the product development (and production/distribution methods).
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Regarding innovation in itself, to face the disruption age° it is necessary to understand that in the new market phase:
● innovation becomes a fundamental factor: in this phase of rapid (and radical) changes it is no longer possible to try to maintain the position already achieved, but it is necessary to continuously improve the product prorpio and its own Company.
Note that this is nothing but the way in which Civilizations develop: for a Civilization, there is no possibility of maintaining (long) a status quo. In the medium to long term the evolving Civilizations always prevail over the “consolidated” civilizations.
● innovation takes on a different meaning: it is essential to understand how, first of all, the concept of innovation is radically transformed: in development methods and goals.
In the new form of innovation, the so-called disruptive innovation°, replaces the traditional R & D (aimed at improving some quality features of the product) with a process of substantial, radical transformation of its offer.
To understand how this is possible, it is necessary to understand that the new scenario offers completely different opportunities than the current ones. Or in the current market:
– the new products are Smart: most of the value of the product is in its service-component (Product as a service), based on the intelligence embedded in it (software). This smartness is conceived in an evolutionary way (with software upgrades the qualities of the product can be transformed).
– the products are highly modular, and therefore can easily be modified.
Beyond the Integral Architecture: the Modular Architecture
– the company is designed in a very flexible way, and can be quickly adapted to new forms of production Industry 4.0: the Smart manufacturing
Furthermore, the Customer is integrated into the product design, which makes it possible to adapt the product to the evolution of needs and expectations of the Demand “in real time” (a role determined in this trend has the radical change of Marketing, which becomes Participated Marketing°) <see The problems of the current Market: strategies: toward a crowd participated Marketing>
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The goals of the innovation change according to the change in Demand, which is substantially driven by new needs and new customer expectations:
This is due to the fact that:
● Today, customers are no longer able to afford to buy the products of the current concept. These products are sold by leveraging emotional factors, such as the super-performance of the technologies and the status-symbol: factors that do not represent a real useful value for the Customer. That is, the Customers are forced, from a contingent situation, to buy only products that are able to satisfy their essential needs.
● Customers develop new expectations, because:
– are afflicted by problems of various kinds, linked to the development phase of our society, and
– they realize that the new generation of technological products (together with the new good practices related to it) can improve – much – the quality of their life.
The key point is:
today it is necessary
AN INNOVATION AT THE LEVEL OF THE PRODUCT SUBSTANCE
and no more at emotional level.
< see From frivolity to sustainability // From internet to reality>
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In summary, the Business must consider that in the current situation of disruption, it is necessary to adapt itself by developing a real disruptive innovation (of the Company and of the Product) due to two disruptive factors:
● it is no longer possible to sell the products of the current generation (even if we develop effective spins on the part of Marketing, Customers are no longer able to buy them)
● it becomes extremely easy and quick for competitors born of nothing to overwhelm the consolidated players (the disruption affects not only the product, but the company itself, as regards every area, from the internal organization to the phases of production and distribution). Industry 4.0: the Smart manufacturing
Take into account that in the new market phase – which emerges following the disruption in progress – it is developed an eco-system of producers of various kinds that allows small producers (small workshops) to compete with the current big players. Integral Innovation – Innovation Ecosystem
<see The need of an Ecosystem of Innovation
For example, in the automotive sector, small domestic appliance manufacturers can produce new generations of City cars (probably the best-selling cars in the next market phase) radically different from current cars. A Fork of the Automotive Market
<see “Beyond the Automotive: radically new vehicles produced by new players” “Manufacturing 4.0: How will the new phase of Industry actually be”>.
Product innovation (and Marketing in itself)
The product strategies that make a disruptive leap to the offer are fundamentally based on the actual correspondence of the product to the real needs of the people.
The difficulty in correctly interpreting these needs and expectations is in the fact that this New Demand° presents absolutely new characteristics for the Market: new needs are hidden and in evolution.
The development of this type of strategies is possible adopting a disruptive innovation to the Marketing itself: the New Marketing° – functional to the Disrutpive Age°, in fact reverses the current direction of the product concept (top-down), taking it to a direction bottom-up in which
the Consumer
they become the protagonists
of a co-designing process.
This is the Participated Marketing°, with which it is possible to develop a Crowd driven Innovation°, ie a Value-oriented innovation°. With Participated Marketing it is possible to evolve the product following practically in real time the evolution of needs and expectations of the Customer. Innovation is intrinsically (historically) bottom-up — Crowd-driven Innovation/Crowdsourcing
Disruptive Innovation of the Company’s structures
In order to develop new disruptive strategies, it is therefore necessary to radically change the mindset and structure of the company as well.
It is therefore necessary to develop a New Vision°, and to use in the internal processes people that able to go beyond the current linear mindset°, that is the current lack of intuition°.
But also radically change the size of work and production methods.
<see The new dimension of work>
<see The misunderstanding on Industry 4.0: towards Manufacturing 4.0>
For an effective assessment of the quality of a product's innovation, the "TrendInsights's Guidelines to Disruptive Innovation" was developed, which offers:
1) an essential description of the meaning and methods of Disruptive innovation, and
2) a methodology for those who want to start a Disruptive Innovation business.
3) a Table summarizing the quality of the Disruptive Innovation for an assessment of business innovation capacity (usable both for developing a new Business and for analyzing Business already in progress).
<see "TrendInsights's Guidelines to Disruptive Innovation" >
