In the distinguished lecture series arranged by the School of Electrical Engineering, Faculty of Engineering and the Built Environment at the University of Johannesburg’s Kingsway campus on Monday 25th July, Col Prof Barry Shoop discussed the disruptive innovation course he teaches at West Point. Prof Shoop surprised the audience by his approach that staying only close to customers can blind you from disruptive innovations and leads increasingly to failure for leading technology companies.
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“The rate of disruption is accelerating and established industry leaders are failing and disappearing faster than ever. The average lifespan of a Fortune 500 company was 61 years in 1958. By 1980 it had decreased to 25 years. By 2011 it was 18 years,” said Prof Shoop. “One of the reasons big technology firms have such short lifespans now is that they miss innovations. Other corporations pick those up and take their market share away.”
“Companies that stay close to their customers are more susceptible to failure, because they’re listening to their customer. It’s counter intuitive. You go to your customer and say ‘what do you want?’ and they say X and you give them X. The problem is, your customer won’t see the next big thing and so you miss it. In 1995, the Harvard Business School researcher Prof Clayton Christensen identified this weakness of leading technology companies in his article ‘Disrupting Technologies: Catching the Wave’,” added Prof Shoop.
“This problem of customers leading companies astray is not new. Someone else said the same thing a long time ago. Henry Ford said ‘If I’d asked people what they wanted, they would have said faster horses’.”
The gallery of fallen global technology giants include mobile phone makers Blackberry and Nokia, as well as photography company Kodak, he added.
Ironically, a disruptive new technology usually can’t initially compare in terms of performance with its established cousins and has to be evaluated with new measures. Those new measures won’t make existing, demanding customers happy. As an example, the first mobile phones could not offer the same quality of service or geographical reach as fixed telephone services. These were brick-sized and had a battery life of less than an hour, but offered the new performance measure of portability from the start, said Col Prof Shoop.
However, to spot disruptive innovation in time and develop it successfully demands new kinds of nerves in managing people, culture and structure in a business.
“To get innovation in general, you need to put people together in the workplace, very different people who would not naturally work together to get a true diversity of perspective,” said Col Prof Shoop. “If you truly want to be innovative, you have to accept risk and failure. You need to develop a culture where people trust you to get their back if they fail.”
On top of this, disruptive innovation demands a culture and willingness to argue at martial-arts levels about ideas, with diverse colleagues from different levels. Shoop saw this in action at a premium technology giant founded a century ago and still in the Fortune 100 in 2016: IBM.
Concluded Prof Shoop: “When I had the opportunity to meet with the Vice-president: Innovations for IBM at the TJ Watson Research Centre near West Point, he took me around the projects that students were working on. He said ‘if you see people in conference rooms who look ready to punch each other, arguing passionately and vehemently, remember that it is never personal. It is about building the very best solution’.”
His lecture provided much stimulating debate and provided a new perspective to innovation and customer engagement in the technology sector.
Added Prof Saurabh Sinha, Executive Dean of the UJ Faculty of Engineering and the Built Environment and former IEEE Vice-President: Educational Activities: “The ‘disruptive innovation’ theme delivered by Prof Barry Shoop describes our Faculty’s approach of unconventional thinking and solving tomorrow’s problems with new, but alternative, solutions.
“A recent example of this quest was internationally demonstrated by our students who delivered and built an electric vehicle for the Shell Eco-marathon in London. The UJ Voltronics Team 32 kg vehicle achieved over 300 km / kWh, placing 15th globally and beating out teams from Europe. This illustrates how an electrical vehicle approach could potentially disrupt an otherwise well-established fuel based industry. The approach is to democratize technology – initially thinking accessibility and affordability, and gradually competing with bigger players.
“Our Faculty’s new set of Research and Innovation chairs, including the jointly funded City of Johannesburg-UJ Research and Innovation Chair in the Green Economy, is another illustration of an industrially-based academic chair which takes forward the traditional research chair model of endowment and partners with industry to solve sustainable development challenges,” concluded Prof Sinha.