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Creative disruption and the process of eating yourself.
The idea of eating yourself before somebody else does is
explored with great gusto in Wolfgang's book on Radical Innovation.
The concept here is one of the challenges that organizations
really have is it's very hard to basically
destroy something you already have to create something
better that you might have in the future. Let's use an example.
If you take Sony, for example,
Sony basically if you go back,
made an absolute fortune on Sony Walkman.
They were the first people to put music on your belt in
the palm of your hand, to make music effectively mobile for people,
and the famous Sony Walkman sold in every country in the world.
Sony at the time also were the first people to develop the technology for mp3 players.
But the part of Sony that developed the technology for
mp3 players was in a different part of the company that made the Sony Walkman,
and they went to war within Sony.
The Sony Walkman division had one advantage to the mp3 division.
They made money, and they made profits,
and mp3 division just basically cost them money.
The Sony Walkman division commissioned a market study that
told them that you would never sell mp3 players in the market,
you would never displace the Sony Walkman.
Sony abandoned their mp3 project,
and kept trying to sell the Walkman.
Six months later, the Apple came out with
their mp3 player and the Sony Walkman division was bankrupt within a year.
What it tells you is Sony were unable to encounter the concept,
that maybe they had to destroy part of
their own business to allow another part of
the business to grow and succeed in the future.
They failed to eat themselves.
I'll give you another example around creative disruption.
I was working with a board of directors,
not that long ago,
of quite a large manufacturing business.
They have plants in about seven or eight different countries,
and many of their products were struggling;
largely competition from the Asian markets and the Indian markets,
but they also had no evidence they were
actually produced any new product for a very long time.
We had a discussion around if I was their competitor,
what would I do to destroy their company?
Now what was interesting is I split the board into two halves.
Half of them were sent off with that question.
You are now the competitor,
I've just given you $50 million to come up with how you would destroy yourself.
The other half were sent into another room,
and they were given $50 million,
and asked to come up with new ideas for how they're going to
basically enable their company to keep growing and surviving.
One half were given the process of destroying themselves,
and the other half were given the process of enhancing themselves.
Those who was given the task to destroy their company came up with
three times more ideas than the other half of group that were
given the process of trying to enhance what they did.
The learning from that for them was that people out there
are going to be much more creative trying to destroy something than create it.
It's one of those interesting paradoxes of
modern organizational life that it's actually much more of
a creative process to destroy organizations than it is to continue them to grow,
and thrive, and survive.