It is the year 2019, and the report from Clayton Christensen, the Harvard Business School professor and inventor of the term Disruptive Innovation explains that the concept of Disruption has become a buzz word in the business world. Every executive is looking for a way to disrupt their market but very few people really understand what “disruption” means.


Disruptive innovation is often misconstrued to mean innovation that focuses on changing an existing market and growing the said market into a multi-million-dollar empire. However, it’s quite the opposite, and as such many companies fail to hit the mark with the understanding of this concept.


Many researchers, writers, and consultants use “disruptive innovation” to describe any situation in which an industry is shaken up and the previously successful incumbents stumble.


So, what’s this buzz word about?
Clayton Christensen said, “disruption displaces an existing market, industry, or technology and produces something new and more efficient and worthwhile. It is at once destructive and creative.” Simply put, disruptive innovation involves thinking that focuses on customers’ evolving needs rather than the existing market.


A relatable and well-known example in line with this specific thinking about disruption is how Netflix disrupted the entertainment industry and ran Blockbuster out of business. Netflix started off with almost the same business model as its competition i.e. Blockbuster Entertainment. However, they discovered that the tastes of its clients, even though it was a small fraction, were shifting. Netflix decided to cater to the needs of this demographic even though many people called them crazy and said it would never work. Netflix positioned itself by providing online streaming services and is worth over a billion dollars. This is what disruption is about.


Netflix didn’t only throw Blockbuster off guard; they completely disrupted The Alaba International Piracy Market and the entire Nigerian Movie Industry. They did this by providing affordable streaming services in this market at a standing monthly subscription rate of $10 which comes to N3,600. What this has done is taken away the stress that local film makers had to go through with striking unfavorable deals with these movie distribution folks for their films not to be pirated.


Thanks to Netflix, film makers in Nigeria now distribute their movies easily and with less worry over theft.


Disruption Today

While the mantra “disrupt or be disrupted” may strike fear into the heart of many large firms, true disruptive innovation is surprisingly rare. Many people confuse disruptive innovation to mean providing a product or service, but disruption has different types and requires several strategic approaches. Companies need to react to disruption, but they should not overreact, by dismantling a still-profitable business for the unknown.


For any organisation to truly thrive they must adapt by implementing both sustaining and disruptive innovation. Sustaining innovation, unlike its disruptive sibling is an incremental innovation, which improves existing products. It develops existing ones with better value, allowing companies to compete against each other’s sustaining improvements.


Disruptive innovation, on the other hand, is an invention or reinvention that helps create a new market and value network. It disrupts the previously existing markets by displacing earlier providers of the same product or service.


The innovators dilemma can be made easy with a simple adaptation of these complementary measures to achieve cutting edge innovation and create a revolutionary business edge.


Disruption Tomorrow

As the gamut of new technologies unfold, and businesses inevitably grasp the breadth and depth of everything the digital age has to offer, the order of the day has changed for good. Digital transformation has come to take over the way organisations operate.

With this, you would imagine once we understand what “Disruption” and “Digital Transformation” are, then we are on the next flight to success. Sadly, this is not the case because even with the hype on disruption and digital transformation, a lot of organisations do not fully understand how it works. Many Organisations focus on the competition without first analysing their internal processes.


They often don’t ask critical questions such as – Who are we, where are we going and how are we getting there?  


How well your business thrives depends on your contextual use of these principles. In a statement by Business Guru, Jay Abraham, he stated that most business owners say they want their businesses to grow but they focus on external factors. They don’t look at their core process. It is essential for businesses to first conduct a thorough self-examination and begin the disruption internally before focusing on the outside world.


As an organisation what are your goals? Do you have people within the organisation that can help you meet these goals? Will your current processes help in the actualisation of your growth?


What do your customers want? Do you know your customers? Asking yourself these questions is the first step to finding an innovative and disruptive solution.
The good news is that all you need to do is “Listen and Look”. Here’s what we mean:


First, Listen – We’ve already mentioned two types of innovation for business growth. Listening which involves getting feedback from your most valuable customers is a key factor in sustainability innovation.


For example, let us look at the phone industry paying specific attention at the stages from the first phone to the evolution of the iPhone. Many phones back then had poor camera quality or didn’t have at all. The iPhone didn’t sell because of its name in 2007, it sold because it provided a service the other phones didn’t provide – better camera quality, among other features. By meeting the needs of the people who could not afford to get the cameras, Apple changed the game in a big way.


the Look – this involves looking out for the needs of a neglected niche market and innovatively finding a solution to cater to their desires.


Apple did not stop with their camera phones. What they also did was continue to listen. They paid attention to their customers. Apple took feedback from the ever-changing demographic representation of its customers as well as reports on what the market was doing and used it to build a formidable brand. In 2007, the iPhone was cheaper than the first IBM smartphone in 1992 but today, the iPhone is one of the most expensive phones in the world. The brand has created an identity in the minds of its customers – it has successfully positioned itself as a luxury brand with ease of use.


At this point, you may be wondering if disruption has ever occurred within the Nigerian context. It certainly has and there are success stories to tell.


For example, take the story of the Telecommunication Industry in Nigeria;


Prior to 2001, Nigerian Telecommunication Limited (Nitel), dominated the telecommunications market with 400,000 customers over a 40-year period. Nevertheless, Nitel failed in its operational systems due to its inability to meet the growing demand for digital services.  After the formal deregulation of the sector in 1992 and the introduction of the Global System for Mobile communication (GSM), we saw the emergence of a new crop of blue-chip companies.  This spawned an increase in the number of networked people which saw a cumulative 4 million subscribers across all GSM companies in the first 4 years since the first entrant entered the market, as well as a surge in investments in the sector.


This originally premium-priced service quickly became the most retailed necessity for every Nigerian, growing the different competing markets at an alarming rate and contributing to a sizable chunk of the country’s GDP.


As if this isn’t disruptive enough, these telecommunication brands have now latched onto lifestyle, FinTech and ICT services to offer more than just mobile communications.


Another example is the evolution of the Nigerian Financial Services Sector


For decades, Nigerian Banks were unaffected by the digital revolution that transformed global banking. The fondly coined new generation banks such as Zenith Bank, Guaranty Trust Bank (GTB), and the former Standard Trust Bank (now UBA) that emerged from the late 80s to late 90s embarked on sustainable disruptive initiatives. They did this by steadily democratising Banking services.


These new generation banks disrupted the market by expanding their branch networks and offering innovative products to areas of the country that had limited or inexistent interactions with financial institutions. These disruptive projects kickstarted the banking revolution.


Notable disruptions in the banking sector include the creation of a multi-region branch network that was pioneered by STB; zero openings balance, cash deposit ATMs, mobile banking and social banking introduced to the market by GTB.


Disruption has even gone further with the birth of FinTech’s who have suddenly redrawn the competitive landscape and raised the bar for interested players – by capitalizing on the latest technology and customer empowerment. Let us also not forget USSD banking that has changed the way we transact.


Disruption Forever

Digital Transformation and Disruption are still redefining the business world and only organisations who have created seamless processes and poised themselves for this multidisciplinary approach to growth will survive.


Disruption is not a piece of cake, quite frankly it is a risk. However, it is essential for your organisation to analyse and discover what they need to do to stay relevant in the future.  Society cannot progress if it cannot continually create new sources of value, as older ones are now depleted.


Disruption doesn’t necessarily happen overnight, it may even take years to see the external results, but if you keep improving, innovating and iterating, you will remain at the pinnacle of digital maturity and the world will become your uncontested marketplace.


Written by:

Temisanren David


Feranmi Owolabi-Okojie

Senior Consultant