Business disruption is an opportunity not a threat

Author: GIBS News
Source: GIBS News

​​Earlier this year, during a GIBS Forum, trends analyst Dion Chang offered some business-focused insights into the exciting app-based transport network Uber. The founder of FluxTrends said at the time: "I really, firmly believe that Uber is going to be the benchmark case study for disruptive businesses for MBA students in the future."

Uber may certainly be a case study for the future, but fortunately South African business already has an existing example of successful business disruption in action in the form of Discovery, the healthcare group founded by Adrian Gore in 1992. Today Discovery encompasses activities from healthcare to life insurance, investments and savings, as well as wellness. An innovative and entrepreneurial culture has been a driving force within Discovery, but – like international examples such as iTunes, Skype and Netflix – the group has succeeded by responding to challenges and becoming an effective disruptor.

A new white paper, released as part of GIBS's Digital Disruption programme, a partnership with Dimension Data, throws some light on Discovery's evolution, as well and the importance of business disruption in general.

The authors, Ian James, Programme Director for Digital Disruption at GIBS, and Christoff Prinsloo, a management consultant who is currently pursuing a PhD at GIBS, make the clear and important distinction between innovation and disruption. As they note: "Disruption implies not only new products or processes, but changed organisational goals, structures and visions; transformations that can extend beyond a single organisation to transform the market landscape. Disruption offers new ways to look at and meet customers' (often previously un-met) needs."

In the case of Discovery, harnessing disruption came down to making a fundamental shift in the nature of insurance: focusing on stimulating change in people's behaviour change rather than penalising risk. This was achieved through the use of "sophisticated big-data analytics and fresh combinations of partnerships, incentives, devices and tools to found an expanding business". Make no mistake, argue the authors, this is no easy feat – after all steering an entire industry in a new direction is a mammoth undertaking – but in a dynamic and increasingly digitally-focused world, this agility in business is vital.

Africa-based companies, note the authors, are at the forefront of fast-moving technological advancements, with the mobile phone industry creating new and unifying opportunities to unite business across the continent. Understanding how to harness the power of disruption and learning from the likes of Discovery is critical, is a theme running through the report.

As the authors stress: "Companies that change with the times are rewarded with continued success, while complacent and inflexible organisations decline and disappear." They add:  "Thus disruption here is used as a neutral, descriptive term. Disruption is not the negative result of uncontrollable forces, but rather a proactive and achievable goal that companies should have on their strategic agenda."

*To read more about GIBS Digital Disruption programme and to download the white paper, visit the GIBS website at gibs.co.za/digitaldisruption

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