The  difference  betweenDisruptive  Innovation

and  Breakthrough  Technology

Richard  BunkSAAB  Combitech

Lindholmen   Software  Development   Day  2016

Many  disruptive  innovations  of  today  are  based  on  key  technologies  that  turn  out  to  be  invented  years  ago,  sometimes  even  decades.

How  come  these  inventions  never  reached  any  disruptive  levels  on  the  market?

More  than  50%  of  launched  products  in  USA  never  make  any  customer  success,  despite  large  amounts  of  money  and  time  spent.

Ericsson R380, is considered to be the first smartphone, released in 2000

CTO of Sony Ericsson (Mars 2009):-We had smartphones on the table before Apple’s iPhone.

Cell phones launched 2007

Motorola RazrR2

Blackberry Pearl

LG Rumor

Sony Er. K630

Samsung Gleam

iPhone

iPhone  disruptive  features

• iPod  +  Cellphone  +  Internet  connectivity• One  device  model  fits  all• No  physical  keyboard• Finger-­‐touch  screen• Flat-­‐rate  data  plan• Dialog-­‐based  SMS  (speach  bubbles)• High  level  of  usability• …

What  Apple  iPhone  Does  not offer,  and  Nokia  does offer(Oct  18,  2008)

• Cannot  change  the  SIM  card• No  Video  Recording• No  SMS  Forwarding• No  MMS  Sending• No  Cut,  Copy  &  Paste• Non-­‐Easy  Battery  Replacement• No  Wifi  Support• No  Bluetooth  File  Sharing• No  Adobe  Flash  support

Will  you  still  buythe  costly  Apple  iPhone?

The Sony Ericsson innovation model

Combine any new technology with all pre-existing popular features, and then launch a product of each kind.

Those technologies that the market like, we continue to evolve upon.

Strategy:Profit should arise from launching never-before seen groundbreaking technology.

Basic assumption:Customers buy cell phones in order to get access to new technologies.

This is why some of the most disruptive innovations are so difficult to copy …or understand

Apple’s vision(effectively)

Turn ugly and difficult technologies into simple and beautiful things

Guess what part cost the most…and was the first to break

Sony Ericsson Xperia X1

January 20091.5 years after the iPhone entered the market

Less than two years later, Sony had its first year of financial losses in decades (-24 billion SEK). Also Nokia signalled a massive drop in profit

…and Apple displayed a quarterly report that Forbes called nothing less than ”truelly enormous”. Making a profit of 13 billion SEK – in a quarter!

Asked ”what Apple should do with its 230 billion SEK in accumulated cash”, the CTO of Sony Ericsson replied:–In Apple’s place, I would save the money. Times are bad right now.

One lucky shot?

So just how did Apple manage to find the exact right mix of features to make the phone simple and beautiful?

…especially when Sony Ericsson couldn’t find that recipe even after an almost complete permutation of technologies, with years of advantage.

And how come Apple, and a few other select companies, succeed in doing this over and over again – in hardware products, software products, services, …even buildings?

Patently Apple

The facts• It’s not about any cutting edge technology

(Sony Ericsson already tried that).

• It’s not merely about putting lipstick on a pig(Nokia already tried that with replacable shells).

• It’s not about money. Apple hasn’t always had huge amounts of cash floating around…and Sony Ericsson already tried pouring money onto product development anyway.

• So it has to do something with the customers

• But it can’t be pure fanboy’ism, because loyalty arrive only as a consequence of long and steady customer satisfaction (brand managers have known that for decades).

• Could Apple have some clever interviewing technique, or data-mining mechanism, to find out exactly what the customers want?

If I had asked people what they wanted, they would have said faster horses.

Henry Ford

You can't just ask customers what they want and then try to give that to them. By the time you get it built, they'll want something new.

Misconception → Insight1. It’s not about the actual product. Sorry, but your customers will not primarily be

interested in your product.

2. Rather, they view your product as a tool …a tool to achive some other task. And it is the urge to complete that other task that motivates your customers.

A painter cares about making a painting …not playing with the brush.

He might know a few things about brushes, and spend some money on them. But the main task for the painter is to get that image out of his head, and project it for others to see.

3. If you can offer a tool that helps users achieve that underlying task they have, then they will become your customers, and your product will become a success.

So what you need to do……in order to find out if your product will become a success, is to figure out just why the customers will choose to use your product in the first place.

Stop spending time on understanding the customers (too complex).Instead, start focusing on understanding the actual task driving the user …the mission it needs to complete?

To find that answer, you will need to study what the customer’s entire environment looks like when that mission is complete. And be open to anything you find in that study, because customers often don’t buy what the company thinks it’s selling.

If you manage to create a new, easy or cheap product that helps the customers finish that underlying task more enjoyably than your competitors do, you will have the recipe for a disruptive innovation.

Thank you!

Richard BunkSAAB Combitech

So, what are the underlying tasks that motivate us consumers to pick up the smartphone every day?

Did Sony Ericsson ensure our tasks are completed?Did Nokia?Did Apple?