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Embracing Constructive Disruption: Unlocking Innovation Without Destroying the Old

Saturday Special: From an interview with Ursula Eysin of the Code Red Podcast

Disruption is a loaded term in the world of technology and entrepreneurship. It conjures images of startups storming the gates, intent on tearing down entrenched industries and leaving the old guard in ruins. The idea of “creative destruction” – replacing outdated systems and business models with bold, innovations – has captivated innovators and terrified incumbents alike.

However, as Chris Kalaboukis, a renowned futurist and serial inventor, points out, the reality is far more nuanced. “Destruction is a side effect,” he explains. “Basically, for example, look at something like Uber. Uber is extremely disruptive if you ask me because there was a system in place that was so fixed and stolid and nothing would get around it and then Uber just came in and replaced it. They didn’t look at destroying the taxi industry or destroying the travel industry or destroying the food delivery industry. They just said, ‘we’re going to create something that’s better, that can serve our customers better.'”

This distinction is crucial. True innovators are not driven by a desire to demolish the old, but rather by a relentless focus on creating something new and better. The “disruption” occurs as a natural byproduct of these superior solutions displacing the status quo. As Kalaboukis observes, “From the consumer’s perspective, it’s not disruption. From the consumer’s perspective, it’s like, ‘oh, great, I have another choice. I have a choice that’s better.'”

Osela Eysin, the CEO of Vienna-based Red Swan and Kalaboukis’ co-host on the “Code Red” podcast, echoes this sentiment. “Great inventors don’t destruct,” she affirms. “They create new solutions instead. Typical examples of genuine disruption actually illustrate that quite well. I think the inventor of the automobile was not primarily concerned with demolishing carriages, and streaming services do not count destroying other sound carriers among their co-activities. These new technologies have solved customer needs in a completely new and convincing way and thus pushed existing systems out of the market along the way.”

This distinction between “destruction” and “creation” is vital, as it highlights a key difference in mindset. Entrepreneurs driven by a desire to “disrupt” often find themselves at odds with the very incumbents they seek to unseat. Eysin notes that established companies and funding agencies frequently demand “disruption,” but only in an “orderly” and “safe” manner – an inherent contradiction.

“Because one of the first questions I have to answer is, ‘is there already a willingness to pay for the proposed service or product?'” Eysin laments. “I even dared to say that the invention of the automobile would not have made it to the next round in a European funding scheme. Just imagine the pitch interview with car brands, for instance, going like this: ‘Mr. Bands, before we support the development of your automobile, we would like to know how many people would actually buy it. Have you ever sold a single unit of it? No. Well, how much experience do you have in the automotive business? Nothing either. We must say you are not the first one to try something like this either. Yes, yes, yes. Let’s be honest, Mr. Bands, one component of your invention, the wheel, dates back to 4000 before Christ. So your idea isn’t that new anymore? But come on, give us a two-minute elevator pitch on why someone would prefer your automobile to a carriage, convince us. Wouldn’t that be just preposterous?'”

Kalaboukis nods in agreement, noting that truly groundbreaking ideas often struggle to gain traction in risk-averse corporate and regulatory environments. “Had they not pushed it, had he not just pushed ahead and done it? I think that he would never have made it through any funding scheme. Nobody would have given him money,” he says.

This speaks to a fundamental tension between the disruptive mindset of innovators and the cautious, status-quo-preserving instincts of established players. Eysin laments that in Europe, in particular, “we have another great thing – it’s called regulation. We have a lot of that too. I’m not sure if we talk about the same level of that. So we are very good in preventing entrepreneurs from doing exactly the thing you just described, I must say, because if you have a regulation hindering you to do it and just try it, it’s really very, very hard.”

Kalaboukis acknowledges this challenge but points to the resilience of true innovators. “Pushing against the envelope as far as you can can actually show you maybe where the limits are and then you maybe have to backtrack to something that’s more useful,” he says. “But they won’t let you backtrack in the EU.”

So, if destruction is not the end goal, and merely a byproduct of creating something better, how can we harness the power of disruptive innovation more constructively? Eysin and Kalaboukis identify several key strategies:

1. Shift the Mindset from “Destruction” to “Creation”

Both Eysin and Kalaboukis emphasize that innovative thinkers are not primarily motivated by a desire to tear down the old, but to build something new. “You can’t really be an innovator if you’re pessimist, because you have to see things, things can get better,” Kalaboukis asserts. “You can’t innovate if you think things are going to always going to get worse. So you have to look at things from a, from a, from a, not a from a destructive light, but from a, from a creative light.”

Eysin agrees, noting that “great inventors don’t destruct. They focus on creating new solutions instead.” By reframing the narrative away from “disruption” and towards “innovation,” entrepreneurs and companies can shift the cultural conversation to one of progress and empowerment, rather than fear and resistance.

2. Embrace Long-Term, Visionary Thinking

One of the key obstacles to disruptive innovation, Eysin and Kalaboukis argue, is the short-term focus of many organizations. “Everything’s just incremental,” Kalaboukis laments. “So we can take what we have today, and we can just add this and add this and add this and add this and add this. And then you have a Jenga of foundations that you pull one block out and everything collapses.”

Instead, they advocate for a more visionary approach, where companies and individuals look 10, 20, or even 30 years into the future, and then work backwards to establish a strategic roadmap. “If you start with where we’re going to be in the longer period of time, work backwards, then you get a much better picture of where you want to go as opposed to where you are now, because where you want to go and where you are now, there’s a huge gap there,” Kalaboukis explains.

This long-term mindset not only enables more ambitious goal-setting but also helps organizations identify and overcome the myopic “benchmarks” and “short-term management goals” that often stifle true innovation.

3. Cultivate a Culture of Experimentation and Calculated Risk-Taking

Closely tied to the need for visionary thinking is a willingness to experiment and take calculated risks. As Kalaboukis points out, many organizations are paralyzed by the demand for a “solid business case” before pursuing new ideas. “But you mean, you don’t want to experiment. You don’t want to try things out of the blue. You don’t want to try things that have no return just to see what happens to see if a return comes down in the future,” he laments.

Eysin agrees, noting that the most transformative innovations often emerge from a spirit of experimentation, rather than a focus on immediate profitability. “Look at Twitter,” Kalaboukis says. “Twitter would not exist if it weren’t for, ‘you know what, let’s just give it a shot. Let’s try it. Let’s put it out there. We have no idea if it’s going to be useful. We have no idea if anybody’s going to use it. We have no idea how we’re to make money with it. But look at it today.'”

By cultivating a culture that embraces calculated risk-taking and experimentation, organizations can create the conditions for truly disruptive ideas to flourish – not through wanton destruction, but through the constructive process of innovation.

4. Empower Employees to Identify and Pursue New Opportunities

Closely related to the need for experimentation is the importance of empowering employees to take ownership of innovation. Kalaboukis notes that in many organizations, employees are “trained to be cogs in the machine” – efficient but uncreative performers who are discouraged from rocking the boat.

Instead, he argues, companies should actively encourage their employees to explore new ideas and solutions, even if they don’t immediately align with the organization’s short-term objectives. “If you start with what’s the business model, you’re already restricting yourself into a tiny little box saying, ‘we got to make sure we make money with this before we even do anything about it,'” Kalaboukis says. “And if you ask me, that’s not innovative, that’s not disruptive. That’s just like, okay, well, you’re just, you’re just being incremental.”

By empowering employees to be proactive, visionary, and unafraid of calculated risks, organizations can tap into a wellspring of innovation that might otherwise remain untapped.

5. Embrace Competition and Choice

Ultimately, Eysin and Kalaboukis argue that the key to harnessing the power of disruptive innovation is to focus on creating better solutions, rather than solely on destroying the old. As Kalaboukis explains, “Nobody’s trying to take down the banks, nobody’s trying to take down the colleges, nobody’s trying to take these things down. They’re just trying to build a better version that people can then have the choice to go to.”

This emphasis on choice and competition is critical, as it shifts the narrative away from “disruption” and towards “progress.” When consumers have multiple options, each vying to offer a superior product or service, the end result is not destruction, but rather a flourishing of new ideas and the empowerment of the customer.

“So if I go to a college online and get my degree through them, then the other college, I could just as easily choose to go in person to an old line traditional college,” Kalaboukis explains. “So having all of these options out there, I think are where things are going. And I don’t think anybody sets out to destroy things.”

By embracing this constructive, customer-centric view of innovation, organizations can harness the power of disruption without succumbing to the fear and resistance that often accompanies it. The goal, Eysin and Kalaboukis assert, should not be destruction, but rather the creation of something better – a loftier vision that benefits both businesses and consumers alike.

Ultimately, the key to successful, sustainable disruption lies in shifting the mindset from “tearing down” to “building up.” By cultivating a culture of visionary thinking, calculated risk-taking, and employee empowerment, organizations can unlock the true potential of innovation – not as a means of destruction, but as a pathway to a brighter, more prosperous future.

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Alex Tsakiris
Alex Tsakiris
1 month ago

“sustainable disruption” love it.

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