No matter your strategic objectives, market disruption is a brutal fact of life for many middle market companies. Everywhere are the corpses of once-triumphant corporate behemoths who have fallen victim to disruptive innovation. Rochester-based Kodak, once the world’s largest producers of film, decided not to pursue the market-revolutionizing digital camera while its competitors did. In the end, Kodak’s film business would be disrupted and the company would file for Bankruptcy. Having strategic objectives is fine, but be prepared for disruption — and try to lead it.
Middle market companies should be driving disruption. This is not limited to technological innovation, according to the pioneer of disruption theory, Harvard Business School Professor Clay Christensen. Disruption is about serving customer needs that are going unmet. For example, the growth of the Internet created new opportunities for people to use online search capability to collect information about local restaurants, auto repair shops, and an array of local service providers. Users benefited by avoiding the cumbersome, clunky Yellow Pages. But it wasn’t until San Francisco-based middle market company Yelp arrived in 2004 that all this information was made accessible on a single, easily searchable website. Yelp has rendered the Yellow Pages almost irrelevant by offering added-value information such as customer ratings to local, online directories.