Disruptive Innovation
IT IS EXPECTED THAT HALF OF THE S&P 500 COMPANIES WILL BE REPLACED IN THE NEXT DECADE, IN FACT THE AVERAGE TENURE OF A COMPANY IN THE S&P 500 IS DECLINING.
In 1965 it was 30 years, which dropped to 20 years in 1990, and is expected to drop even further to 10 years by 2030. While this phenomenon is attributed to several root causes, disruptive technologies and innovation is one of the reasons, as it has enabled the successful startups to grow at an unprecedented rate. In addition, accessibility to disruptive technologies and laser targeted advertising at a very low cost, has made it possible to experiment with new ideas cheaply and quickly.
TO SIMPLIFY THE MEANING OF THE TERM DISRUPTIVE INNOVATIVE, WE DEFINE THREE TYPES OF INNOVATIONS THAT COULD BE DISRUPTIVE:
NEW PRODUCT INNOVATION
We distinguish between two types, “Incremental” and “Potentially Disruptive” product innovation. Most product innovation investment dollars are directed to Incremental innovation which is based on an existing product as the base, than adding improvements including new features and design changes targeting mainly existing markets. The Potentially Disruptive product innovation is the kind that gives birth to new industries and/or replaces existing ones. For example, how the mobile cell phone impacted to the pay phone.
BUSINESS MODEL INNOVATION
Business Model Innovation allows a whole new breed,of startups and SMEs, access to a product or service that was historically only accessible to incumbents with deep pockets, strong capabilities or intellectual capital. Once a truly disruptive product or service takes root in simple applications at the bottom of a market it can move relentlessly up market, eventually displacing established incumbents. For example, what the introduction of on-demand economy in the local transportation and hospitality is impacting the traditional taxi and hotel industry.
NEW PRODUCT AND BUSINESS MODEL INNOVATION COMBINED
WHY EGNYT
EGNYT Team’s multifaceted experience with strategic consulting, design thinking, and technology partners, provides us with a unique three-dimensional perspective into a business and the ability to evaluate and identify its best opportunities for success in the marketplace. By providing unbiased guidance and an external perspective, EGNYT can help companies shortcut the trial and error process of sifting through noise and ideas and instead help management focus on the handful of ideas most likely to create value and drive ROI.
It takes both sides of the brain, the creative right-side and the analytical left-side to successfully generate and commercialize ideas. But very few people are skilled at both. EGNYT helps build a culture of teamwork so that it enables you to tap into both sides of the brains in your organization and foster innovation in new business models and products/services. We have deep experience in assessing innovation performance and identifying solutions to foster ongoing innovation. We employ multiple tools and approaches to EGNYT (“ignite”), capture and catalyze sparks of ingenuity.
EXPECTED RESULTS
DISRUPTIVE INNOVATION
Innovative Business Models don’t come from following competitors. EGNYT provides a change from the status-quo with a new set of eyes, expert analysis, and creative, idea-sparking activities to help accelerate your business growth.
TALENT
Combine right-brain creativity and left-brain management skills to spur innovation and attract and retain creative and commercial personnel more successfully. Improve the effectiveness of decision making and build and sustain a culture of innovation and continuous reinvention.
RAPIDLY INCREASE INTRINSIC VALUE AND ROI
Achieve ROI in 6 months or less on short-term initiatives and opportunities with same fiscal year improvement in company’s intrinsic valuation.
IMPROVED SUCCESS RATE
Achieve project success rates five times better than traditional projects.
BETTER PERFORMANCE
Generate higher productivity, speed up time to market and increase team motivation.
NEW WAYS OF WORKING
Embed innovative ways of team work and co-working in your organization.INVESTOR READINESS
THE IDEA BEHIND THE BUSINESS
Early-stage Investors look for clear, concise idea and founders that can think and communicate clearly. Founders not only need to attract investors, but also attract and recruit top talent and attract customers by selling the product/service. Therefore, the idea behind the startup needs to be clear before embarking on journey to spread the message.
We help startups position their business as new rather than something derivative. Most successful startups started with something fundamentally new. We help you position your business as something that 100x better as opposed to one of five other companies that are starting the same thing. Investors and new employees will want to partner with you and join you if you are creating something new.
THE PRODUCT OR SERVICE
You need to have a great product or service in place. What is a good product? A simple question that often gets the wrong answer. One way to get the right answer is to ask your existing (or future) customers and figure out exactly what they need, where to find them, and what makes them buy what you are planning to offer.
We help you understand your users well in order to better define your great product. Our approach may include starting with a product or service that doesn’t necessarily scale and recruit initial users one at a time, until the right offer is perfected. We help you build the product that end-users want, one brick at a time.
PROOF OF CONCEPT AND GROWTH
If you don’t yet have a proof of concept, you need to break the problem into small pieces, and iterate and adapt as you go. Most common mistakes founders do is try to plan too far out and launch everything in one big batch release.
We help you start with something simple at first and launch it soon, then talk to users and watch them use your product, figure out what parts are sub-par, then gradually improve, then repeat. The faster the repeat rate of this cycle, the better the company usually turns out. We help you get this cycle right, you have to get very close to your users. Literally watch them use your product. Building a simple product first to test the hypothesis.
There are three ways to conduct proof of concept.
The first is if you are building a consumer product which you could test by launching a simple product fast and see what happens. The second is for enterprise product in which you try and sell the product before you build it. The third is for products that require intensive R&D such as biotech and hardware companies, the way to test an idea is to first talk to potential customers and then figure out the smallest subset of the technology you can build and test first.
There are three ways to conduct proof of concept.
The first is if you are building a consumer product which you could test by launching a simple product fast and see what happens. The second is for enterprise products in which you try and sell the product before you build it. The third is for products that require intensive R&D such as biotech and hardware companies, the way to test an idea is to first talk to potential customers and then figure out the smallest subset of the technology you can build and test first.
COMPETITOR AND MARKET AWARENESS
Once you have a great product and proof of concept, it begs the question, what is the addressable market? How big is the addressable market and how fast is the market growing? What is the market going to be in 10 years?
We help you develop backed up assumptions as to why it’s a good market for a startup to go after. We help you frame your business plan within major technological shifts that are just starting but most big companies haven’t realized yet. We help you establish a business model that gets more powerful with scale and that is difficult to copy (quasi monopoly).
With such business models, competitors (primarily copycats) become less of a worry. That said, most disruptive startups end up failing from internal issues and problems (suicide) rather than murder (by external competitors). Therefore, how you run your company, Team, Focus and Execution are key to success.
THE PRODUCT OR SERVICE
You need to have a great product or service in place. What is a good product? A simple question that often gets the wrong answer. One way to get the right answer is to ask your existing (or future) customers and figure out exactly what they need, where to find them, and what makes them buy what you are planning to offer.
We help you understand your users well in order to better define your great product. Our approach may include starting with a product or service that doesn’t necessarily scale and recruit initial users one at a time, until the right offer is perfected. We help you build the product that end-users want, one brick at a time.
FOCUS
Being focused is hard for entrepreneurs, because founders that start companies are typically the sort of people that always like doing new things. One reason some startups fail to death is doing too many things even when it is doing the right things.
A company should not start doing the next thing until they’ve successfully conquered the first thing and it is running on autopilot. One thing we help entrepreneurs do is focus on priority things. Equally important to setting the company’s strategic priorities is setting the founders’ tactical priorities. We coach entrepreneurs to become decisive, which is hard when managing a startup and you will get a lot of conflicting advice. Great founders listen to all of the advice and then quickly make their own decisions.
EXECUTION
As a successful startup, you have not succeeded until you turn your product or service (that you worked hard to build until this point) into a great company. To do so, startups must rely on their limited resources and existing skill sets to get all that done successfully. Hiring experienced managers to fill in the skill gaps does not work as you cannot insource all the work needed by hiring. Furthermore, you cannot outsource the needed work for a long time. Therefore, there needs to be balance to increase your chances of success. This is where we step in, we support you by giving the targeted support you need to cover skill gaps when you need it most, and when hiring someone to bridge the specific skill gap is neither possible nor financially sound. We act as an extended member of your Team to give you the right support when you need it most and when hiring external people is not an option.
WHY EGNYT
- We help founders get to profitability as quickly as possible so they can control their own destiny early-on and are no longer at the whims of investors and financial markets
- We act as an extended member of your Team to give you the right support when you need it most and when hiring external people is not an option.
- We provide founders with the needed coaching and support needed which includes key success factors such as recruiting the right team members, ensuring focus and improving communication skills
- Understand what drives company valuation in your sector and steer your company’s business model positioning to maximize value to the founders and investors alike
- We assist in defining the product or service by making you understand your users well which may include starting to recruit initial users one at a time, until the right offer is perfected
- We help you achieve proof concept and drive growth by bringing the right product to the market under the right business and operating model, and help you monitor and collect the right metrics to validate market opportunity, growth and proof of concept
- We help you organize to build the right business model and reinforce your capabilities to cover all basis for successful fundraising effort