Editorial: Disruption, Anyone?

DISRUPTION as a business strategy was first propounded by Professor Clayton Christensen of Harvard Business School. He taught disruptive innovation as a powerful tool for small companies with fewer resources to challenge established or incumbent businesses by addressing an underserved need.

In his theory, Christensen identified three approaches to business innovation, namely: sustaining innovation which happens when an established company creates improved versions of its products to sell for a higher profit; low-end disruption, in which a company targets a segment on an established company’s market base and forces the latter to focus on its upmarket clientele; and new-market disruption, in which a company claims a new segment of an existing market by providing a solution to a need that was previously unfulfilled, unsatisfactorily fulfilled, or fulfilled at great cost.

The third approach is the most disruptive. As the upstart improves and expands its range of products or services, the incumbent’s products or services become obsolete. Think of what Netflix, Spotify, and Zoom have done in their respective niches, while locally we can name Angkas, BYD, and Lalamove as some of those who are pursuing disruptive innovation in their fields.

As often happens, strategies born in the boardroom find their way into the political sphere - the market being the voter base and the public persona or campaign platform of a politico as the product being sold. In the Philippines where there are no real distinguishable identifiers between and among political parties, disruption is perhaps the fastest and most effective way an upstart can challenge long-entrenched incumbents. By targeting underserved segments, whether the disservice is real or perceived, a “new- market”politico’s chances of garnering votes are increased. Hence one sees campaign slogans, jingles, and speeches targeting students, retirees, the poor, women, LBGTQI+, PWD’s, commuters, laborers, and the great unwashed, and promising them everything that they need that the incumbent apparently ignores or sweeps under a rug, if the challenger is to be believed.

It is always interesting to watch when a disruptive challenger succeeds, takes office, and finds his expectations rudely meeting political reality. In the crucible of the plenary debates, hallway negotiations, and committee hearings for those in the legislative, or in budget deliberations, resource allocation, and filling administrative positions for those in the executive, the disruptor’s mettle is tested and his or her brand is either burnished or blemished.

Disruption is inherently based on fostering conflict: Brand X is better than Brand Y, Candidate A is more responsive than Candidate B. This is why, like Marmite, disruptors are an acquired taste. Preferring the status quo to remain undisturbed, many may look on the disruptor as the fly in an otherwise sanitized and reliably familiar ointment.

The sense of conflict enlarges the higher the position sought becomes or the more entrenched the incumbent is. How the disruptor absorbs, addresses and thrives in this high-pressure environment defines how he or she changes the system or is changed by the system. It is thus not entirely unusual to see disruptors becoming pariah in the company of peers, or being forced to compromise to the point of becoming more “trapo” than the incumbent they unseated.

One thing is certain about disruptive innovation in business: only those companies that actually deliver for the underserved segment survives and thrives, while the rest wither and fall by the wayside. This becomes less certain in politics, especially when disruptors can themselves easily turn into traditional politicians, or if the disruptor is actually part of an entrenched clan. The litmus test is whether the needs of the underserved have been met or they are left searching for another promising upstart willing to joust against the constantly turning political windmills.

Mayhaps Rotarians should paraphrase our Four-Way Test when meeting a political disruptor and ask: Is he true? Is he fair to all concerned? Does his disruption result to good governance and better public services? Is his disruption beneficial to the public he proposes to serve?