Cannibalisation Is Not A Useful Choice Of Language

Phil Libin, CEO of Evernote, doesn’t like the word “cannibalisation” because it’s zero sum. It implies that you’re the guy doing the eating or being eaten.

He says being in business is not like playing a sport or being in warfare. It’s more like music, it’s more like art. It’s not a zero sum game.

I absolutely agree with Libin, and in the long run his view is the only healthy and constructive way to think about business. However, this doesn’t account for the popularity of books among business people like Sun Tzu’s “The Art of War” or Machiavelli’s “The Prince”.

What’s going on here?

Why does Libin think about business as music, whereas many others think only of warfare?

A first explanation is that most people who think and write about business are not C-suite executives or founders of successful companies, and so they are typically exposed to the hostilities that are inevitable in trying to rise upwards. Even in the friendliest of work environments employee performance will be reviewed annually and productivity will be compared against other employees working at the same level.

Large professional service firms typically place employees in a kind of tournament like dynamic where they are shown the promise of a small number of well-paid managerial roles and the implicit threat of being fired if they fail to perform better than their peers.

A second explanation is that some industries are more zero sum than others.

Any industries dealing in the real world of atoms (for example, mining, farming or transportation) are likely to see the world in a more zero sum way. The customer either buys my coal, corn or transportation or they buy someone else’s.

Industries dealing in the virtual world of information on the other hand (for example, tech start-ups) are likely to see the world in a more collaborative way. After all, there is always more information and goodwill to go around.

That being said, I would suggest that Libin’s view of business should apply not just to the technology industry but to all sectors.

Economists have coloured our thinking by painting traditional business as a place where firms compete to maximise profits through the sale of goods and services, forgetting of course that businesses can only sell their products by first engaging in some form of marketing. And what is marketing, if not the pure and free exchange of information.

Libin is in the technology industry, but in a strange and unexpected way, so are we all. And as a result, talk of “cannibalisation” is not a useful choice of language.

Ready or Not

The Consulting Industry is Ripe for Disruption

Ripe for Disruption

(Source: Flickr)

ACCORDING to the Harvard Business Review, the consulting industry is one of the most resistant to change. Even though consultants are brought in by corporations to innovate and shake things up, the consulting industry itself has been slow to innovate.

At its core, the consulting industry has remained the same for more than 100 years. Meanwhile, new tools and technologies have become increasingly sophisticated and available.

This begs the question, “why hasn’t the consulting industry been reinvented?”

CONSULTED, a company run by CEO Sebastian Sager, have not only asked this question but are also taking action, and may be on the cusp of profoundly changing everything.

Using a non-traditional business model, CONSULTED is on a mission to give companies access to expert consulting without the long-term commitment or initial expenses.

Traditional Consulting

Traditional consulting is perfect for enterprise businesses that have massive budgets, constantly “creeping” needs, and a particular business structure which is difficult to change. But even so, engaging a traditional consulting firm often only makes sense if the consultants are used to the fullest.

The issue with traditional consulting is that it doesn’t work in all cases. Very rarely do businesses – big or small – use the full consulting retainer. As a result, money that gets paid to consultancies could have been invested in other areas of the business.

The startup world is rapidly changing the way that businesses operate. For example, it is now easy to find credible, highly regarded contractors to fix your house through online tools like Angie’s List.

Why aren’t the same resources available for helping businesses get advice?

Many founders and mid-level managers don’t need a long-term consulting contract – they’re just looking for some quick, credible advice to guide them through a problem situation or challenge.

Credibility is key, but you shouldn’t have to pay an arm and a leg for it. Consulting should also be flexible so that people can get the advice they need by scheduling a quick phone call or discussion via Skype. You shouldn’t need to “know a guy” or have a contract in place to get the help you need.

A New Era of Consulting

It’s finally time for a fresh new approach to consulting – something that is designed to truly help businesses.

Enterprise-level clients are starting to look at changing the way they engage consultants. Professional service companies in the past charged high fees for standard service packages, making them unsuitable for companies that needed a more discrete piece of advice.

Many newer consulting firms are addressing this pain-point by offering smaller and more flexible consulting “blocks” and flexible collaboration packages so that companies can get on-demand consultancy on topics ranging from audits to Lean Six Sigma to strategic planning. This is a step in the right direction, but a whole new consulting model appears to be on its way.

Companies like CONSULTED are developing solutions which allow clients to forget about meetings, memos and all the other unnecessary hassles that come with engaging a major consulting firm. They also allow users to browse a range of experts from around the world, review consultant credentials and save money by paying for only the time they use.

Is this a disruptive innovation? How is this new consulting model likely to affect your business? Share your thoughts in the Consulting Forum.

Clayton Christensen on Disruptive Innovation

Disruptive innovations often beat successful incumbents

CLAYTON Christensen, author of The Innovator’s Dilemma, is an authority on disruptive innovation, a process by which a product or service initially takes root in simple applications at the bottom of a market and then moves ‘up market’, eventually displacing established competitors.

Christensen gave an insightful talk back in 2009 at the ECS National Forum on Education Policy on “How Disruptive Innovation Will Change the Way the World Learns”.  This talk is relevant for business leaders, consultants and entrepreneurs because Christensen explains how disruptive innovations can displace successful market leading firms which produce quality products.

How could this happen you ask?

Good question.

In the videos below, Christensen provides a clear account of disruptive innovation and some implications for business. If you are interested in new technology, disruptive innovation and business theories that will help you and your clients achieve sustained success, then this talk is for you.

If you have any thoughts on disruptive innovation, please share in the comments below.