The upside to disruption

Disruption may seem like a scary word sometimes, but it shouldn’t be. In fact, the only organizations that should be scared of disruption are those actively avoiding it. Today, most businesses must not only embrace disruption as a necessary part of re-inventing themselves, but should expect it to change the way their industry evolves and operates.

 We live in fundamentally transformational times. The evidence is everywhere. In the mainstream media, at events such as the World Economic Forum in Davos, in books and blogs and in board level discussions about how to steer our businesses through times of ambiguity. We hear about it all the time. Yet for many, it is difficult to know how to respond and keep pace.

 This week in San Francisco, EY is convening leading disruptors, technology entrepreneurs and chief innovation officers from 20 countries and across all industries to address this. But while disruption can be perceived as a threat to incumbent organizations, our focus this week will be on the upside of these shifts and on how to make innovation a reality.

 We are discussing what leaders need to think about in this new world to survive in today’s environment and to get ready for the future. New ideas and technologies are rapidly disrupting traditional models; we’re examining how organizations and governments can adapt.

 Here are some key takeaways from Day 1 of the retreat:

1.  Creating new markets—new products for new customers—is what’s disruptive and therein lies growth.
2. Innovation has to become everyone’s DNA at an organization. The tone is set at the top, but it’s not someone’s title or corner office.
3. Every disruptive idea comes from the space of what we don’t know that we don’t know.
4. You can’t expect innovation without building slack into people’s days, give them time to think and create.
5. Identify what part of your business model has already died and have the hard discussions about the implications for your business.
6. Achieving cognitive diversity with your workforce is as important as other kinds of diversity.

 Today’s disruptive environment is ripe for new market opportunities. Every industry and government body must rethink how to connect to their clients and constituents. Asking the right questions and not jumping to conclusions will also help make it clear that they are open to innovation as a way of life, not as lip service.

 Leaders in every industry are responding to shifts that would have seemed unimaginable even a few years ago. Artificial intelligence (AI) and robotics are fundamentally reinventing the workforce. Drones and driverless cars are transforming supply chains and logistics and challenging policymakers to rethink existing approaches to infrastructure and regulation.

 Changing consumer preferences and expectations are also having a massive impact on industry — most notably in millennials and Generation Z. These groups are leading the change in consumption patterns and demand for everything from cars to real estate to entertainment.

 Responding to these forces, including the potential negative impacts on job availability and employment, is one of the biggest strategic imperatives facing today’s business leaders and policymakers. Governments and businesses will have to work together to strategically redeploy people to new roles and offer retraining and education to growing sectors. Through all of this, they will have to figure out how to bear the resulting costs while maintaining social stability. 

 At a time when there are many unknowns and no easy answers, it’s all the more important to first ask the right questions. This is our primary purpose this week.

 Behind every challenge is an opportunity. Our approach of asking better questions seeks to find the upside of disruption, which in turn helps build a better working world. The ultimate better question is how you find the opportunity in the challenge. How do you seize the upside of disruption?

 The era of being afraid to make mistakes and take risks is over. Over the next 5 to 10 years, those that embrace the upside of disruption – that transform the way they operate – will be the winners.

The views reflected in this article are the views of the author and do not necessarily reflect the views of the global EY organization or its member firms.