Sunday, July 16, 2017

Book Review: 'Big Bang Disruption: Business Survival in the Age of Constant Innovation' by Larry Downes and Paul Nunes

About these highly disruptive innovations: There’s some really great news and there’s also some really terrible news….

Those who have read Larry Downes’ previous book, The Laws of Disruption: Harnessing the New Forces that Govern Life and Business in the Digital Age (2009), and/or Paul Nunes’ previous book, Jumping the S-Curve: How to Beat the Growth Cycle, Get on Top, and Stay There (2011), were probably as excited as I was to learn that they have collaborated on Big Bang Disruption in which, yes, they develop some of their prior insights in much greater depth but, key point, they provide additional information, insights, and counsel of an equally high quality that offer the substantial value-added benefit of their collaborative, as Roger Martin would characterize it, their integrative thinking.

As I began to read this book, I was again reminded of Charles Darwin’s observation, “It is not the strongest of the species that survives, nor the most intelligent that survives. It is the one that is the most adaptable to change.” Downes and Nunes suggest that a new paradigm, Big Bang Disruption, occurs much faster and has much greater impact than does the process of natural selection to which Darwin referred. However, in both instances, the given species — biological or organizational — must adapt or perish.

I was also reminded of the material that Ichak Adizes provides in Corporate Lifecycles: How and Why Corporations Grow and Die and What to Do About It (1990). In this book, what he views as the ideal combination, the ideal balance, of four critical “factors” (i.e. performance, administration, entrepreneurship, and integration) will always be a “moving target” under constant “attack” by internal as well as external forces, each organization must constantly be aware of what that ideal combination is for it at any given time, what that ideal balance should be. Change is the only constant. Downes and Nunes agree while noting that Big Bang Disruption (for better or worse) can occur almost anywhere and at almost any time; also, whereas the lifecycle that Adizes describes can be either progressive or regressive, extended over a period of time (years and even decades), the one Downes and Nunes have identified has the power “to undermine stable businesses in a matter of months and even days.”

The information, insights, and counsel that Downes and Nunes provide in this book are based on years of wide and deep research, in conjunction with the Accenture Institute for High Performance, that focuses on disruptive innovation in more than thirty industry segments, research that generated more than a hundred detailed case studies, “many recent but some historical.”

These are among the dozens of business subjects and issues of special interest and value to me, also listed to indicate the scope of Downes and Nunes’ coverage.

o Exponential Technologies (Pages 21-30)
o What Makes a Big Bang Disruption (30-41)
o The Economics of Organizational Transformation (46-47)
o Undisciplined Strategy: The Declining Cost of Creation (48-57)
o Unconstrained Growth: The Declining Cost of Information (57-65)
o Unencumbered Development: The Declining Cost of Experimentation (65-74)
o The New Life Cycle of Industry Transformation — The Shark Fin (77-83)
o The Four Stages of Big Bang Disruption (83-85)
o Pinball, the Replay (85-95)
o Four Stages of the Shark Fin (103-106)
o The Singularity: Three Rules (107-112)
o The Big Bang (143-167)
o The Big Crunch (171-178)
o Entropy (203-209)
o Four Kinds of Specialization (236-240)

As Downes and Nunes explain, academic thinking about disruptive innovation has evolved through three phases during recent decades: Michael Porter’s advocacy of “three generic strategies,” for example, suggests a top-down approach whereas Clayton Christensen’s insights in The Innovator’s Dilemma suggest that many (most?) of what he called “disruptive” technologies usually start as inferior alternatives that enter the market at the bottom and work their way up as the new technology is improved. Downes and Nunes are convinced that they now enter the market as superior alternatives right from the start. So what? Incumbents can no longer await the appearance of inferior disruptors as their signal to start thinking about what they might do with the new technology sometime in the future. That’s now a recipe for disaster. Business thinkers such as W. Chan Kim and RenĂ©e Mauborgnue (in Blue Open Strategy) fine-tune the bottom-up approach while suggesting that some innovations (like spontaneous combustion) can occur whenever and wherever the right conditions exist.

Downes and Nunes make a convincing argument that Big Bang Disruption heralds a new phase, the fourth phase. It has three defining characteristics: undisciplined strategy, unconstrained growth, and unencumbered development. The implications have immense (albeit potential) importance. For example, the innovations that Big Bang Disruption makes possible can be achieved by almost any organization, whatever its size and nature may be, creating new, opportunities whose nature and extent are unprecedented: undisciplined strategy is possible because of the cost of creation just as unconstrained growth is possible because of the reduced cost of information and unencumbered development because of the reduced cost of experimentation.

Long ago, someone asked Henri Matisse if he painted all the time. “Oh heavens no, but when my muse visits me, I better have a brush in my hand.” The same can be said of Big Bang Disruption. Business leaders must understand that such an innovation can achieve great success for their organization but, paradoxically, that success can then destroy it if they do not manage with rigor and prudence the opportunities that success creates.

No brief commentary such as mine can do full justice to the scope and depth of the material that Larry Downes and Paul Nunes provide in this volume. However, I hope that I have indicated why I think so highly of it. For many executives, this may well prove to be among the most important business books they will ever read. Whether or not their organizations engage in Big Bang Disruption, they can at least avoid being devastated by it.

Editor's note: This review was written by Robert Morris and has been published with his permission. Like what you read? Subscribe to the SFRB's free daily email notice so you can be up-to-date on our latest articles. Scroll up this page to the sign-up field on your right. 

No comments:

Post a Comment