Three lessons that Uber can teach us about digital disruption

27th Aug 2015
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The importance of our ‘online’ offerings is giving way to customer experience as the major differentiator between businesses. As a result, traditional industries which were not widely acknowledged to ‘need’ shaking up, have been turned upside down by disruptive technologies.

Let’s take Uber as an example; the car hire service hit headlines globally with its recent US$51bn valuation. Uber is changing the way consumers build relationships with service businesses; not only does it encourage driver-passenger interaction by providing the name of both parties and the ability to ‘rate’ your driver and passenger, but it also offers an instant service through location technology.

Uber has used a unique customer experience to disrupt the transport industry - even in London where the classic ‘black cab’ is an iconic service. In a similar vein, other businesses need to think about how they approach disruption and innovation.

To stay relevant, large businesses must address their customer experience and how it could be disrupted by smaller, more agile players, and act to ensure that they remain ahead of any encroaching competition.

Here are three top tips for businesses to be more disruptive:

1. Remember, innovation is a process, not a goal

In its purest form, innovation is the introduction of new things or methods. However, within business today there is often more focus on the outcome of innovation, rather than its creation.

This focus on end goals hinders businesses from causing market disruption and embarking on innovative transformation projects. The pressure to prove a project’s success from the get go means that companies do not see the process as innovation. True innovation comes through the changes that are made progressively, which collectively will drive the business forward.

Businesses on a path to transform themselves should consider whether their business structure is organised for disruption and innovation to be a true possibility. For example, if a business wants to boost customer resales, focussing on boosting ROI on an existing feature could stifle innovation, rather than foster it. Another example is if a marketing team with monthly targets to hit is faced with digitising customer touchpoints – a process which could foster a significant increase in customer relations. At the cost of compromising their short-term goals, the team is more likely to dedicate resources to utilising existing channels than embark on a new project which could actually reshape the business for years to come.

Businesses should be thinking of innovation within the process, rather than as an end goal. Playing the long game means that even heritage businesses can compete with the new kids on the block who are revolutionsing their industries. Whilst immediate business goals are important to achieve, businesses can really make their mark by embodying innovation over the long-term.

2. Unlock siloes within your business

It’s possible for even the biggest enterprises to compete with disruptors like Uber, provided that they patch up their ‘communication gap’.

Talented people exist across many business units, but most of the time the absence of cross-department relationships prevents skills from being shared. The marketing department, for example, might understand the need to drive innovation within its customer relations programme, but it is trying to do this in isolation from IT and customer service, who have access to data on customer interactions. Collaboration across businesses is a part of almost every successful innovation project.

The division of responsibility and core accountability is often the major inhibitor to the creation of innovative processes. Instead of encouraging these roles and departments in isolation, businesses should look at how internal walls can be broken down to encourage collaboration. Service businesses are constantly trying to do better by their customers, but the process could be improved and more easily, if they identify whether the answer to their question already exists within the business.

3. Identify innovation champions in your business

One of the main challenges a business faces when trying to encourage innovation is getting the rest of the business on board. For example, when a business decides to improve its digital footprint, the decision is often made to appoint a chief digital officer. However, you cannot appoint a CDO and expect digitisation instantly and from them alone; to achieve a change in the business, there needs to be participation from key stakeholders across the organisation.

There must be a central team that presents a vision of the project, and the business transformation that the innovation will enable. Identifying the senior transformation champions across departments such as IT, marketing and business development is vital to making any innovation project a long-term success. These are the people that are dedicated to seeing through the benefits that change will bring and can highlight the value of transformation across the business.

A by-product of this togetherness is the motivation and fulfilment brought about by working to higher level goals and with people that bring new and different perspectives. By encouraging collaboration, businesses will see processes created and implemented, driving innovation within the company and creating market disruption.

Every business can be a disruptor if it champions business transformation internally. A sustained approach to innovation means that even the biggest businesses are able to compete with first-to-market start-ups like Uber. Start-ups cannot pull the rug from under an established business’ feet if that company has continually developed, innovated and disrupted their own industry.    

Stephen Morgan is European managing director of digital transformation business, Squiz

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