Disruptive Innovation: What is disruptive innovation

Disruptive innovation creates new products or services that customers love and can occur through Low End-Disruption or New Market Disruption.

 

Why disruptive innovation? 

When you are building a new product or service, you first need to understand which type of innovation you are aiming to achieve. Neither is better or worse but the rules of the game are slightly different for each. There are two main types of innovation. 

 

Sustaining Innovation 

The primary focus of sustaining innovation is profit. Already established companies focus on making a better product for their most lucrative customers and extracting maximum profits. This sounds like a good strategy but often leads to failure over the long term if companies become too comfortable and complacent while focusing on growth of margins and not growth of new markets and revenue streams. 

 

Disruptive innovation 

The second type of innovation and the force behind disruption—occurs when a company with fewer resources moves upmarket and challenges an incumbent business. There are two types of disruptive innovation: 

  • Low-end disruption, in which a company uses a low-cost business model to enter at the bottom of an existing market and claim a segment 
  • New-market disruption, in which a company creates and claims a new segment in an existing market by catering to an underserved customer base 

 

According to Geoffrey Moore’s framework, in order to successfully compete in the age of disruption, every company needs to balance both Sustaining and Disruptive innovations. Each of these are broken into zones. Sustaining innovations are all about driving productivity and performance. Disruptive innovations on the other hand are about incubating new ideas to catch the new waves of emerging markets and transforming new services or new product lines that are entirely differentiated from the existing business models and perfectly answer to customers’ needs. 

 

 

This Rangle knowledge hub is dedicated to give you guidelines on how to operate in the incubation and  transformation zones of disruptive innovation, whether you are a startup or a large organization. We believe that disruptive innovation is an organizational capability that everyone should strive for in order to prolong their business life cycle.

 

Disruptive innovation requires a fundamental shift in mindset of “falling in love with the problem and not the solution.

Thomas Edison

What is low-end disruption?

Read article 

What is new-market disruption?

Disruptive Innovation: Think traction-first

There are many ideas about determining Product/Market fit (PMF) but in our experience the best way to ensure the success or failure of a new product or feature is by focusing on traction

 

We are living through a global entrepreneurial renaissance. Today, it is cheaper and easier than ever to build a product, which means that there are many more people “starting up” all over the world. While this explosion in startup activity represents an incredible opportunity for all of us, it comes with a dark cloud: more products translates to more choices for both investors and customers, making it harder to stand out. 

 

Customers today are constantly bombarded with a multitude of product choices. When customers encounter a half-baked product, they don’t turn into beta testers and give you feedback; they just leave. Without customer feedback, it’s too easy to fall prey to the “build trap”, where success always seems one killer feature away but remains ever elusive. You end up spending needless time, money, and effort building something nobody wants, until you run out of resources. This is why investors don't value intellectual property, but traction as the primary metric.

 

Traction isn’t about being first to market, but first to market adoption. Traction is evidence that people other than yourself and your team care about your idea. It means customers love your product; so traction is evidence of a working business model. The funny thing is most companies, both startup and enterprise, focus exclusively on building product features, sometimes even testing and validating them in advance, but rarely apply the same methodology to the traction channels needed to acquire and retain customers.

 

"Traction is basically quantitative evidence of customer demand.

Traction: A Startup Guide to Getting Customers

 

There are 19 identified traction channels to consider (

):

  • Viral Marketing
  • Public Relations
  • Unconventional PR
  • Search Engine Marketing
  • Social & Display Ads
  • Offline Ads
  • Search Engine Optimization
  • Content Marketing
  • Email Marketing
  • Engineering as Marketing
  • Targeting Blogs
  • Business Development
  • Sales
  • Affiliate Programs
  • Existing Platforms
  • Trade Shows
  • Offline Events
  • Speaking Engagements
  • Community Building

Disruptive Innovation: What is Rangle GO

Rangle GO is a traction-first approach to early value creation and validation of your disruptive innovation in just 12 weeks

 

At Rangle, we developed a traction-first approach called Rangle GO, that is based on all of our experiences of implementing the latest lean startup and new product development theories in real world companies who wanted to disrupt a market. We combined all of our lessons learnt and continuous improvement ideas in the Rangle GO approach, so we can share these with our community openly, as we believe that knowledge should be free for everyone.

 

Rangle GO is a traction-first, agile approach to disruptive innovation that consists of 12-week, agile Model-Test-Release cycles. The first 12-week cycle brings you from the definition of a business challenge or problem to a validated solution in just 12 weeks. This validation happens by testing the problem-solution fit with a POC at the end of week 3 and testing the idea’s feasibility, desirability and viability with a Minimum Viable Product at the end of week 12. After a validated product idea, you aim to scale and grow the product, which can be done by executing a maximum of 5 cycles of the 12-week Model-Test-Release approach.

 

Rangle GO is implemented in a 12-week Model-Test-Release agile cycle to bake in continuous learning and improvement, customer experience as a foundation, drive alignment, validate new areas of value and remove all the big risks early (

):

 

  • value risk (whether customers will buy it or users will choose to use it)
  • business viability risk (whether this solution also works for the various aspects of your business)
  • feasibility risk (whether the engineers can build what you need with the time, skills and technology you have)
  • usability risk (whether users can figure out how to use it)

 

During these cycles, solutions are figured out collaboratively by engineering, design and product working side-by-side. We focus on solving problems, thus it’s not about features or a roadmap; it’s about delivering results.

Disruptive Innovation: Rangle GO to launch

The first 12-week Model-Test-Release cycle of Rangle GO focuses on launching and validating a Minimum Viable Product that drives traction with its clear unique value proposition

 

Model | Week 1

Explore.Learn.Synthesize.

In the Model phase, you work to define the problem space. The primary goal is to understand the problem, identify the customers, their unmet needs and areas of opportunity to inform ideation, grounding it in the shared realities of the current state. After this, you summarize the findings in a Clarity Canvas that describes the problem statement, the solution idea and a basic user experience connecting the two. Throughout all the activities, taking a jobs-to-be-done mindset is essential for the framing of solving for the actual needs and competing on the right market. 

Scheduled activities:

  • Immersion in present research and existing strategy
  • Stakeholder interviews
  • Competitive and comparative research by following Jobs-to-be-Done framework guidelines
  • Technology and infrastructure research/audit
  • Clarity Canvas workshop

 

Test | Week 2-3

Ideate.Design.Define.

In the Test phase, you work to define the problem-solution fit. The primary goal is to build a Proof of Concept (POC) of a solution, focusing on capturing the Unique Value Proposition and deliver it to potential clients over many interviews to receive their feedback. This is your earliest testable version of your product. For this you need to form and clarify a hypothesis, align on assessment criteria, and determine methodology to inform the MVP. Then you need to test your POC with potential customers to understand what are the emotional forces influencing them to make the decision of wanting to use your product or stick with the alternatives.

Scheduled activities:

  • 4 forces workshop
  • Value proposition design
  • Brand model innovation
  • Wireframing / Conceptual visualization
  • Jobs-to-be-done interviews
  • Evaluation & validation of technology choices
  • System & information architecture planning

 

Release | Week 4-12

Build. Mesure. Validate.

In the Release phase, you work to define the market-solution fit. The primary goal is to build the core features required for the realization of the value proposition, also called as a Minimum Viable Product, that you can launch on the market to test the customer desirability, technical feasibility & brand viability of the solution. 

Scheduled activities:

  • Application Development
  • Implementing Basic Analytics needed to measure stickiness
  • Production Operation
  • Documentation
  • Cycle analysis 
  • Go-to-market strategy and implementation

 

Unlock customer demand for SaMD using the Jobs to be Done framework

Read more 

Previous Chapter

 What is Rangle GO

Disruptive Innovation: Rangle GO to grow

After the launch of the MVP, you may run 1-5 additional 12-week Model-Test-Release cycle of Rangle GO to grow and scale your innovative product, thereby gaining enough reach to disrupt the market you operate on

 

 

Model | Week 1

In the Model phase, you work to define the North Star. The primary goal is to inspire aligned autonomy while managing the product by identifying a single, crucial metric.This happens by first understanding which game you are playing and then identifying your North Star metric and the equation between all the leading indicators contributing to it. After this you need to align all product strategy initiatives to feed the North star and enable continuous measurement. 

Scheduled activities:

  • Identify which game you play
  • North Star workshops
  • Strategy alignment
  • Metrics setup and enablement

 

Test | Week 2-3

In the Test phase, you work to fully optimize the product-market fit. The primary goal is to run a set of well-defined experiments across multiple experience areas in order to identify, shape and implement optimization opportunities before you start scaling.

Scheduled activities:

  • Analysis of data and metrics
  • Design and prioritisation of experimentation
  • Enablement of experimentation
  • Running and reporting on experimentation

 

Release | Week 7-12

In the Release phase, you work to grow the product. The primary goal is to build new features that help gain more traction, grow into a connected ecosystem/platform or enter new markets and segments.

Scheduled activities:

  • Create outcome-based product roadmap 
  • Feature and improvement backlog refinement
  • Development of new features
  • Product marketing

Previous Chapter

 Rangle GO to launch

Disruptive Innovation: Enabling disruptive innovation

In order to enable disruptive innovation, you need a digital-first operating model, customer-obsessed culture and top-notch technology

 

Regardless of the size and maturity of your organization, you will need an innovation-first mindset with strong digital capabilities and a digital-first operating model to be able to disrupt a market with your product. Here are some of the most important anti-patterns and patterns for enabling disruptive innovation in your organization:

 

Anti-pattern: Innovation project mindset >< Pattern: Innovation product mindset

Anti pattern: Milestone-driven predicted roadmaps >< Pattern: Culture of intelligent disruption

Anti pattern: Working with personas >< Pattern: Working with customers

Anti pattern: Focused on MVP building >< Pattern: Focus on traction and growth

Anti pattern: Doing Digital Transformations >< Pattern: Outcome-focused digital-first operating model

Anti pattern: Segregated Innovation teams >< Pattern: Transferring ownership of innovation

Anti pattern: Outsourcing essential capabilities >< Pattern: Growing in-house essential capabilities

Anti pattern: Focus on ROI >< Pattern: Focus on North Star metric

Anti pattern: Scaling too fast to show progress >< Pattern: Scaling solid foundation in the speed of adoption

Anti pattern: Yearly budget cycles >< Pattern: Value-based lean funding

Previous Chapter

 Rangle GO to grow

Disruptive Innovation: Our experience

hims & hers

A scalable digital healthcare platform only in 1 month

See case study 

Babbly

An AI-enabled demo from concept to functional model in just 2 weeks

SaMD with a CE marking

Building the first React Native app Software as a Medical Device to receive CE marking

Borrowell

A brand-first mobile experience goes from concept to the App store in only three months.