The Year of Disruption

Nic Hayes

January 2, 2015

The word for 2014 is also a movement and that word is ‘disruption’. It is all about the disruption of traditional business models by technology that allows us to do something better, cost-effectively and more convenient. The word and movement has everything going for it except for those that are trying to protect their turf by yelling, screaming and complaining to any and all who will listen. Only to find these complaints being used to backfire on them highlighting the failings of their industry. So why was 2014 the year of disruption?

I pondered this question as I was selling my old couches on Gumtree.com.au over the weekend. A few short years ago I would have paid to have the couches listed in the newspaper classifieds but instead in less than three minutes I posted the advertisement on the online platform and sold it within 24 hours. I didn’t have to wait for the Saturday paper to be delivered or stand by my home phone waiting for calls. I had my first Uber ride this year and as I passed an enormous line of people waiting for a cab I got into a lovely car just up the road. It was a pleasant experience both comfortable and affordable not to mention not having to wait in that never ending queue.

The disruptive technology that everyone talks about will only work if the traditional business model is broke or failing. The old adage ‘why try to fix something that is not broke?’ would come into play. Taxis in most states are hard to come by, unfriendly and often late. Gumtree has a platform to sell almost anything and is in most cases free of charge. Their power is now coming into play with advertising and priority listings but it so fast and simple to use. Air BnB the online international room bookings started off as a way to secure more lodgings in San Francisco for visitors in 2008 and now has over 800,000 beds listed across the globe. Everyone and anyone can rent out a room now on this international platform and Air BnB is threatening the global hotel industry.

Those that despise the disruptive movement will throw out suggestions that they are breaking down the very fabric business was built on or in some cases breaching tradition. Tradition was once described to me as the miserable excuse for a lack of vision and innovation. Whilst I respect and hold dear to me some more emotionally charged traditions I will not be fooled on those that are halting development and quality service. After all if the content, products and service are not superior the technology for which these businesses have been launched from would just fail. I do respect that some of these disruptive businesses might be working outside the law particularly when it comes to Uber. Businesses that are regulated by government authorities and also contribute significant taxes have every right to be upset by how easy for this type of technology platform enters the market. The movement has started and there is no going back so governments are just going to have to catch up with the technology or will fail both business and its constituents.

Why did Yellow Pages in Australia who had all the names and addresses of just about every small business in the country fight like tooth and nail to halt the online movement and charge from Google. They were protecting a $ 1 billion dollar industry that demanded extortionist prices for advertisements in their now irrelevant medium. They had a chance to embrace and lead from the front with the technology but chose to protect their old and dying stream of revenue.

How is it in 2014 that people are still voting for governments in the local, state and federal elections via paper and pencil? The technology is already out there to do this and yet we risk human error. The lost ballot papers for the WA Senate last year resulted in a $ 10 million dollar plus re-election. The cost and the inconvenience must be raising concerns for electoral commissions around the world.

The year of disruption is just the beginning for some of the obvious traditional business models. Expect to see a lot more of this next year and business should embrace change and lead from the front. After all no one wants to be void, irrelevant or expired.

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