Big Bang Disruption
Strategy in the Age of Devastating Innovation
Publication Date: January 7, 2014
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It used to take years or even decades for disruptive innovations to dethrone dominant products and services. But now any business can be devastated virtually overnight by something better and cheaper. How can executives protect themselves and harness the power of Big Bang Disruption?
Just a few years ago, drivers happily spent more than $200 for a GPS unit. But as smartphones exploded in popularity, free navigation apps exceeded the performance of stand-alone devices. Eighteen months after the debut of the navigation apps, leading GPS manufacturers had lost 85 percent of their market value.
Consumer electronics and computer makers have long struggled in a world of exponential technology improvements and short product life spans. But until recently, hotels, taxi services, doctors, and energy companies had little to fear from the information revolution.
Those days are gone forever. Software-based products are replacing physical goods. And every service provider must compete with cloud-based tools that offer customers a better way to interact.
Today, start-ups with minimal experience and no capital can unravel your strategy before you even begin to grasp what’s happening. Never mind the innovator’s dilemma”this is the innovator’s disaster. And it’s happening in nearly every industry.
Worse, Big Bang Disruptors may not even see you as competition. They don’t share your approach to customer service, and they’re not sizing up your product line to offer better prices. You may simply be collateral damage in their efforts to win completely different markets.
The good news is that any business can master the strategy of the start-ups. Larry Downes and Paul Nunes analyze the origins, economics, and anatomy of Big Bang Disruption. They identify four key stages of the new innovation life cycle, helping you spot potential disruptors in time. And they offer twelve rules for defending your markets, launching disruptors of your own, and getting out while there’s still time.
Based on extensive research by the Accenture Institute for High Performance and in-depth interviews with entrepreneurs, investors, and executives from more than thirty industries, Big Bang Disruption will arm you with strategies and insights to thrive in this brave new world.
LARRY DOWNES is an Internet industry analyst and author on the impact of disruptive technologies on business and policy. His first book, Unleashing the Killer App, was one of the biggest business bestsellers of the early 2000s. He is a columnist for Forbes and CNET and writes regularly for other publications including USA Today and the Harvard Business Review. He lives in Berkeley, California.
PAUL NUNES is the Global Managing Director of Research at the Accenture Institute for High Performance and the senior contributing editor at Outlook, Accenture’s journal of thought leadership. His most recent book is Jumping the S-Curve. His research findings have been covered by the New York Times, the Wall Street Journal, USA Today, and Forbes. He lives in Boston.
“Big Bang Disruption should be required reading for anyone attempting to launch a business or stay in business in the face of digitally enabled competition.”
—Research Technology Management magazine
“Everything you need from business school in one very direct book. Big Bang Disruption elegantly and simply identifies why innovation happens in some new companies and how you can embrace and harness this new way of thinking.”
—DICK COSTOLO, CEO, TWITTER
“Everyone has heard of the Innovator’s Dilemma, but this book is about the Innovator’s Nightmare. What should you do if your business is disrupted virtually overnight? Reading this book is the best action you can take to fend off a Big Bang Disruption.”
—HAL VARIAN, CHIEF ECONOMIST, GOOGLE
“A fascinating insight. Read this book quickly because the rules of the innovation game change overnight in this brave new world set out by the authors.”
—PAUL POLMAN, CEO, UNILEVER
“Big bangs are everywhere and are happening faster each year and with bigger impact. People in every industry would be well advised to follow the unconventional strategies outlined in this book. Big Bang Disruption got my company energized to innovate ahead of the curve and drive change rather than become victims.” —KANDY ANAND, PRESIDENT AND CEO, MOLSON COORS INTERNATIONAL
“As Jaws was to summer blockbusters, Big Bang Disruption is to business cycles; it presents a playbook for new opportunities and new dangers. It’s also as scary as Jaws but it’s better to know what everyone else will soon see than to bury one’s head in the sand and pretend these disruptors don’t exist.”
—BLAIR LEVIN, COMMUNICATIONS AND SOCIETY FELLOW, ASPEN INSTITUTE
“People think in straight lines and are surprised when there is a sharp takeoff. Larry Downes and Paul Nunes teach us to anticipate exponential growth and think outside the line and onto the curve. Their observations on life and business are seminal for the way we work and live.”
—ANDY LIPPMAN, ASSOCIATE DIRECTOR, MIT MEDIA LAB
“Wow! Big Bang Disruption beautifully captures how technology has changed the speed and cycle of innovation. It is a primer on dizzying change in many industries and a strategy manual for any entrepreneur or CEO who must understand disruptive innovation to survive and prosper. A compelling must-read!” —GARY SHAPIRO, PRESIDENT AND CEO, CONSUMER ELECTRONICS ASSOCIATION
“The strength of the book is to document what is known about the ongoing phenomenon of fast-paced large-scale disruption and the book gives many vivid examples…If Christensen’s disruption from below was scary, big bang disruption can be downright terrifying.”
“As Google’s decision to offer free navigation services shows, disrupters may not give a jot about making money in traditional ways from a service. Moreover, the web means all-out assaults on a market can now be mounted quickly and cheaply. So firms can no longer be sure that rivals will take a step-by-step approach to conquering a market.”
“By analyzing research from the Accenture Institute for High Performance and conducting interviews with entrepreneurs and investors, the authors found a number of characteristics that big bang disruptors have in common. They turned what they learned into Big Bang Disruption, a playbook of sorts for entrepreneurs.”
“What makes this narrative so compelling to me, besides good writing and its undeniably cool cosmic metaphor, is its emphasis on the act of creation. Creation that springs not from isolated innovators toiling in obscurity, but in the context of a universe of suppliers, other innovators, and the individuals who make it all work if they bestow their favor: customers.”
“…[A] stimulating read. It is carefully researched and accessibly written…. The case studies on disruption alone are worth the cover price.”
—The Financial Times
Two leaders in the field of technological applications and business productivity present dramatic evidence for the emergence of a new model for economic innovation, which they call “exponential technology,” and warn that “every industry is now at risk” and must learn how to negotiate the new landscape.
Corporate strategy consultant Downes (co-author: Unleashing the Killer App: Digital Strategies for Market Dominance, 1998) and Nunes (co-author: Jumping the S-Curve: How to Beat the Growth Cycle, Get on Top and Stay There, 2011, etc.), the global managing director of research at the Accenture Institute for High Performance, call their model “the shark fin” due to its ominously familiar shape: a quick vertical launch followed almost immediately by rapid collapse. The world's billion-plus users of smartphone technology form a customer base that has permitted rapid reduction of the costs of implementing new technologies. The authors review Google's free mapping app, which rendered stand-alone GPS technologies obsolete, just as the GPS devices had buried traditional mapmakers like Rand McNally. Downes and Nunes also discuss how Amazon has further transformed publishing and bookselling with each new iteration of the Kindle e-reader. The authors include traditional industries, as well, from automobile and pharmaceuticals to glassmaking and pinball machines. Combined with their treatment of the effects of Moore's Law (regarding the doubling rate of semiconductor power and the reduction of unit price) and Metcalfe's Law (regarding the value of networked goods), their argument becomes extremely appealing. The cumulative effects of both laws extend down the supply chain, dramatically cheapening costs and increasing returns to scale. “As exponential technologies and the disruptors they spawn remake your industry in ever-shorter cycles of creative disruption,” they conclude, “the most valuable asset you can have is speed.”
With informative graphics, the authors deliver a groundbreaking outline for dealing with the inevitable increase in business disruptions caused by new technology.