“Disruption” is probably one of the most frequently used terms in connection with business models and digitalisation. The resulting “digital disruption” describes a scenario in which business models, value chains or even entire industries and ecosystems face varying degrees of challenge, perhaps even coming under existential threat. Such challenges often arise from the presence of new market participants, but can also come from established players developing novel solutions and business models as a result of newly gained digital expertise. These result in a significant change in consumer behaviour. In the sense of Schumpeter’s “creative destruction”, this leads to the above-mentioned disruption of established structures for value chains and business models. The market participants affected by such disruption must adapt their strategies accordingly in order to ensure their long-term survival. Figure 1 shows four examples of such digital disruption:
Figure 1: Examples of disruptive business models
Looking at the examples above, it is apparent that these all share a key similarity – namely that ultimately, the disruption was not caused by a technology, but rather by changes in people. The way people use technologies has changed, leading to changes in their behaviour and, in turn, their service expectations.
In addition to the disruption initiated and driven by people or customers, there are further reasons. A detailed view of these can be provided by the “digital disruption radar”, which is used as part of a disruption health check and systematically analyses four main analytical areas around an existing business model:
Figure 2: Digital disruption radar as part of a health check
As part of a systematic disruption health check, the existing business model is examined in detail and evaluated in comparison to the competition. Using the radar illustrated in Figure 2, potential disruptive influencing factors are identified and evaluated in terms of their impact on the existing business model.
Based on the results of the disruption health check, it’s possible to identify areas of action and prioritise them as part of a holistic digital transformation strategy for possible future implementation. Together with experienced experts from different industries, we’re happy to work with you to provide you with transparency on the current “health” of your business model and potential digital disruption. Please don’t hesitate to get in touch!
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Markus Fost, MBA, is an expert in e-commerce, online business models and digital transformation, with broad experience in the fields of strategy, organisation, corporate finance and operational restructuring.Learn more