At first glance, disruptive innovations can be hard to get your head around. Take 3D printing. How is that possible? If I draw a ball on my computer and click print, will it come bouncing out of my HP Laserjet printer? Cool. And what about Amazon’s delivery drones? My mind goes right to small, black, ninja-like helicopters bonking their noses on my low porch overhang, dropping the Ming vase I just scored for $9.99 on eBay. How is that going to work exactly?
Understanding a disruptive innovation requires a willingness to think differently about something we’ve come to accept as normal, to see an old problem in a new way. Today, companies like Uber, Tesla, Amazon, and Umpqua are asking us to do just that, energizing outdated business and marketing models and upsetting entrenched leaders in the process. A car I can buy direct from its maker, an Internet company that delivers toothpaste before I know I need it, and a bank that wants me to drop in anytime for ice cream and a quick scan of the New York Times via iPad are examples of organizations innovating in unexpected ways, creating new markets for routine products and services that have become decidedly less gratifying over time. These companies have decided to play offense in markets where defense has become the norm.
This concept of disruption is especially compelling when it hits home. Case in point:
In Portland recently, I called for a cab. A business meeting had gone into overtime, and I was in danger of missing my flight to Seattle, a flight I needed to be on in order to pick up my kids from their after-school activities.
So I did what I imagine many people do these days: I pulled out my iPhone, googled “Portland taxi” and dialed the first reputable looking service that popped up. After requesting a large vehicle, one that could accommodate myself and four colleagues, I was told, “No problem. We’ll have someone there in 15 minutes.” Fantastic.
My co-workers and I milled around in the lobby and chatted about the meeting, and then I began to feel apprehensive. Twenty minutes had passed and no cab had arrived. I called the cab company back. “We don’t have a large car available, and we can’t promise one will be available anytime soon.” Silence. What? No apology, no problem solving, and no attempt to re-establish credibility was forthcoming.
Worry about my kids aside, I was furious. In what other industry is such rotten customer service acceptable? Certainly not in the financial services sector or the agency business. In what universe is it acceptable to simply leave a customer stranded? The cab driver that finally arrived was apologetic and drove like a maniac to get us to the airport in time and, while I sat watching crucial seconds tick by as he ran my credit card, I couldn’t fault him for the deplorable service etiquette of his dispatcher. He simply had no control or input into the situation.
Enter Uber. Had an Uber-like service been available in Portland, you can bet my experience would have been very different.
Uber is a new ride alternative that is disrupting the industry for a number of reasons. First, it’s a cashless model—you sign up for the service with a credit card when you download the mobile app to your cell phone. Your ride fee is automatically charged to your card so there’s no need to hover at the end of a ride, waiting for a slip to sign, and no worrying about figuring and adding the tip. Second, when you request a ride, you get to see how many cars are available and how close they are to your location. You can even toggle between car classes, depending on your group size (and your budget). Best, you can then track the car as it makes its way toward you.
Revolutionary. Its true that Uber is more expensive than a standard taxi service, but its also more reliable, comfortable, and efficient. Essentially, this is the anti cab.
The cab industry understandably isn’t happy about this challenge to the status quo, and resistance to Uber and others like it is playing out in courts across the country. But the industry doth protest too much, me thinks. The old system sucks. This market is ripe for disruption.
At Weber, we see resistance to disruptive innovation time and time again. Financial service retailers fight to stay somewhere between safe and static, attached to brand strategies that feel comfortable and controlled, where roles are clearly identified and variables are understood and manageable. The problem is that this space is rarely innovative—not in the least bit. And down the road, this defensive plan often leads to stalled growth and loss of market share. Maintaining momentum requires new thinking, which depends upon a willingness to see ourselves differently, to see the playing field from a new angle.
You have to play offense in order to score. And Uber is scoring big time.
(7.31.14) P.S. If you want to follow the Uber vs. Portland debate, check out this article at the Portland Business Journal : http://bit.ly/1ptyZBB