The problem, to be quite honest with you, is that you’ve never actually known what the question is. – Deep Thought, The Hitchhiker’s Guide to the Galaxy
For a long time, digital technologies were laughably bad. Then, in what felt like an overnight turnaround, they became exponentially good—computers started diagnosing diseases, vehicles started driving themselves, and artificial intelligence is now a ubiquitous black box.
Technology is transforming industries, re-defining careers, and changing forever the way we do things. And looking at this from the aged care industry, it is perhaps no wonder we often forget that technology should be the handmaiden of our commercial success.
There is much talk of technology’s incredible power, and mixed in with this is the doom and gloom verbiage of disruption. This combination of awe and fear is nothing more than a symptom of us forgetting that technology is essentially a tool.
Sir John Hegarty, Founding Partner of advertising agency Bartle Bogle Hegarty, said it best with this:
Gutenberg may have invented the printing press and movable type, but he didn’t create the publishing industry. The Lumière Brothers may have invented the motion picture camera, but they didn’t invent the movie industry.
As market power has shifted from organisations to consumers, with ever increasing levels of competition and decreasing levels of funding, organisations are faced with steep productivity challenges.
Success is not won by those who compete best in a largely homogenous industry. It will be won by those who can generate new demand, and create and capture new market categories.
This has strong parallels to the aged care industry, and as we continue with industry reforms, and be more market-driven, the key here is to avoid being trapped in old markets fighting the same fights for the same consumers.
In order to transcend old markets, we need to consider three potential barriers. INSEAD Blue Ocean Strategy Institute co-directors, W Chan Kim and Renée Mauborgne, frame it best with the following insights.
First, developing new market strategies through consumer-led approaches:
…which causes them (organisations) to reflexively stick to their focus on existing customers and how to make them happier. …Noncustomers [sic], not customers, hold the greatest insight into points of pain and intimidation that limit the boundary of an industry. A focus on existing customers, tends to drive organisations to come up with better solutions for them than what competitors currently offer.
Second, equivocating technology with innovation, and mistaking technology innovation as a pathway to creating new markets, where:
Value innovation, not technology innovation, is what launches commercially compelling markets. …But when companies mistakenly assume that market creation hinges on breakthrough technologies, their organisations tend to push for products or services that are too ‘out there’, too complicated, or lacking an ecosystem.
Third, equating disruption for market creation, forgetting that:
Many market-creating moves are non-destructive, because they offer solutions where none previously existed. …Conflating market creation with creative destruction not only limits an organisation’s set of opportunities, but also sets off resistance to market-creating strategies.
The quote at the start of this article, from Deep Thought in the Hitchhiker’s Guide to the Galaxy is quite helpful at this junction. It teaches us that, if you can properly phrase the question, then the answer is the easy part. It also hits home the reality that conventional wisdom only seems inadequate in hindsight.
Still, having a consumer focus is key to improving products and services. Likewise, technology innovation is an important element of industry productivity, and greater abundance—at times, even a source of disruption.
However, if your intent is to create new markets, the previously mentioned approaches involving consumer-led approaches, technology, and disruption are better aligned with competing in old markets.
As chess Grandmaster, José Raúl Capablanca, framed it: (to succeed) you must study the endgame before anything else.
Published in Fusion, Winter 2018