I had previously written about Clayton Christensen, author of The Innovator’s Dilemma and The Innovator’s Solution, and more recently Seeing What’s Next. This last book gives new business entrants (upstarts) and incumbents a theory-based set of tools to understand and use disruptive innovations. One of the strategies for upstarts is to target non-core customers of the incumbents. These come in three categories (overshot, undershot and non-customers) and by targeting these customers entrants can avoid direct confrontation, while developing skills and expertise in areas outside the core business of the incumbents. Once the entrants have grown “under the radar”, they can grow to directly confront the incumbents.
This book, which is not written by HPT professionals, brings powerful illustrative value to our field. I highly recommend it, as it will stimulate your thoughts – and likely your actions. Seeing What’s Next is about one way for organizations and individuals to cope with the future.
I have been stimulated to take some of this book’s ideas and create the following graphical representation of how an upstart company should look at the “Signals of Change”, especially from non-market conditions. Upstarts should use their asymmetrical sword & shield and focus on non-consumers and overshot customers, such as those paying too much for what they really need (think bloated word processing applications where customers use only 20% of the features). By avoiding the cash cows (Undershot Customers) of the incumbents, upstart companies can develop asymmetrical skills in new fields before the incumbents know what hits them (think Voice over IP and traditional telcos).