How to Disrupt an Industry in Three Steps Everyone's out to change the world these days. While that's no walk in the park, it isn't always rocket science, either.
By Steve Tobak Edited by Dan Bova
Opinions expressed by Entrepreneur contributors are their own.
It's one thing to invent something cool. It's another matter entirely to turn inventions into real products people can use to make their lives easier or better.
Everyone tries to be different, but it's a far greater challenge to make a differentiated product that customers value head and shoulders above the competition.
By that logic, changing the world sounds downright impossible. And yet, we hear people talk about it all the time. Everyone seems to be out to change the world these days. Sounds like a pretty big disconnect, doesn't it?
Yes and no. Making a dent in the universe is no walk in the park, but it's not impossible either. It happens. Real people make it happen. And I can certainly shed some light on how the thought process generally works.
So how does a company come along and, seemingly out of the blue, come up with a way of doing something so much better than before that it captures a huge chunk of market share and disrupts a big industry that's been around forever?
Take Uber, for example. In its last round of funding, the five-year-old transportation network company raised $1.2 billion on a valuation of $17 billion – nearly the equivalent of Hertz and Avis combined. How did its founders do that? What's the real difference between Uber and a taxi or limousine service?
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To a user, it seems so easy. It's just an app. You tell it where you are and where you're going, pick an option, and, voila, a car shows up.
But that seamless and reliable user experience required a complete top-down reimagining of how people get from one place to another when they don't have a vehicle. Not to mention the software development, logistics deployment, and rapid recruiting and operations ramp-up in dozens of cities around the world.
Sure, it's groundbreaking, but in a "why didn't I think of that, it's so obvious" or "how did we ever live without it" sort of way that's reminiscent of FedEx, Tivo or the iPod. A lot has to happen behind the scenes, but the end result always seems simple and easy.
That's just how it is with groundbreaking products. They may be rare events, but when you look at companies as diverse as Uber, GrubHub, WhatsApp, Alibaba, and Apple, they disrupted their respective industries in more or less the same way.
It always starts with a problem. Why isn't there a simple way to get someone to take me from point A to point B? There's no one-stop website for ordering takeout and delivery food. How do we connect a billion Chinese people to the products they want to buy without brick-and-mortar infrastructure? Why isn't there a multipurpose handheld computer?
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Some problems seem immensely complicated while others appear to be downright impossible. Funny thing is, the key is always asking the right question or defining the problem in just the right way – usually a way that nobody's ever thought of it before. In nearly every case, that's the way a disruptive product begins. With a problem.
Next, of course, is a solution. That means figuring out what it will take to solve the problem and putting a team together that can capably handle all the pieces of the puzzle. Of course, if you want to disrupt a market and change how people do things, the solution has to be ten times better, easier, cheaper, whatever, than anything else out there.
While that may sound overly simple – in some cases, it is – it's not always complicated, either. Look at GrubHub. It's a creative solution but, you've got to admit, it isn't rocket science. Neither is WhatsApp, for that matter. And yet, the 55-person messaging company got half a billion users and $19 billion from Facebook. That's pretty disruptive, if you ask me.
Once you have the problem and solution defined, the only thing left is to start doing it. Whether that's getting to work on an app, designing a website, developing a logistics or ecommerce platform, envisioning a new kind of consumer electronics device, raising some seed funding, or all of the above in concert, it always starts the same way: with a first step.
If the enormity of the task freaks you out, congratulations, you're human. Just get your team together, come up with a plan, and set the wheels in motion.
Don't get me wrong. I'm not saying any of this is easy. If it was, everyone would be doing it and we'd be disrupting markets every day. And while the rate of change in our modern high-tech world is rapid, it's not that rapid.
But if you really want to change the world, now you know what it takes. If you can face that and still be inspired and motivated to take the first step, then go for it. You'll never know how things would have turned out unless you do.
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