Illuster current primary global focus area

A massive internet disruption is pending across several key industries. It sounds so ominous and dangerous, almost like scaremongering. Unfortunately it is also getting very hard to get companies to take this impending disruption seriously. This is because disruption is used excessively and in places where it is not relevant. Nowadays everyone seems to think any new change no matter how small is "disruption". However, the "real" disruption of several key industries is impending. The consequences of such a disruption will be very real. The rewards to the disruptor will be immense. For the disrupted it will be traumatic, even fatal.

If your industry hasn't been disrupted "significantly" due to the internet in the past 10 years, there's a very good chance your industry is on the block for an internet led disruption. As in, in the past decade, if the market leaders haven't changed due to tectonic shifts in the industry, your industry is up. The disruption can happen any time. Companies must treat it as imminent. Which brings us back to the biggest barrier to companies taking the imminent disruption seriously.

Companies simply don't seem to believe this can or will happen, or if it will, it will happen to others and not to them. Because they have social media teams, internet run backend and they put out content on the internet. The question is, is that enough? A closer inspection into this can reveal a very scary reality, but a reality that companies need to know now.

The companies that fail, the companies that crash and burn due to internet disruption appear very robust, even unbeatable right before they aren't. When I hear about this, I am reminded of the once mighty Myspace. Myspace was the archetypical internet success story. It's success, dominance, and success in perpetuity was a foregone conclusion at the time. Myspace was not just the market leader, it had an absolute monopoly. In the July of 2006, Myspace was THE most popular website in the United States, ahead of even Google.

Just a year earlier in 2005, Myspace was acquired by News Corporation, the multibillion dollar media behemoth. Myspace was outfitted with the best and brightest of business and management professionals. These business professionals set plans and sound strategy for Myspace to chart and then worked the plan. This led to Myspace growing and by August 2006, Myspace had its 100 millionth user, and many thought it had critical mass and that it couldn't be upstaged. By all means this should have been the case, they had a massive lead, and they had professional management. Then they got disrupted.

Facebook, a fledgling startup that was restricted to a college phenomenon wasn't the first to the game. In fact they were a whole year behind Myspace and paled in comparison to Myspace in the early stages. Facebook even reportedly offered to sell to Myspace for $75 million, which the then CEO of Myspace rejected.

Facebook didn't have top management talent, it was basically composed almost entirely of tech undergraduates, mostly dropouts. But they had a real finger on the pulse of what was going on. They disrupted the social media space by bringing in some nuanced features that they were able to find out by knowing what the users wanted. They didn't find out the users needs through market surveys and focus groups, they observed and followed user behaviour. Myspace asked users to use pseudonyms because they thought that the users wanted privacy, Facebook observed the behaviour of users and saw they wanted "real" interactions. Facebook used real names. Facebook saw the emergence of a trend like social gaming in the form of games like Farmville and built it out. Facebook saw users use the platform to organize events, Facebook developed it out. All of these changes were very nuanced, but they made all the difference in the world. In the words of a former head of Myspace, Mike Jones, Myspace introduced the social network concept, Facebook "perfected" it.

Being on the internet is introducing your clients to a your products and services, disruption winds up "perfecting" it. For the disruptor, the rewards are immense, just 14 years after its founding Facebook is worth 396 billion dollars. It is the fifth most valuable company in the world and the youngest company in the top ten. However, for the disrupted, it can be very painful. Myspace went from having a valuation of 12 billion dollars when it was a monopoly, to being sold for a mere $35 million dollars just 5 years later. Doing what a company is supposed to and implementing best practices can lead even monopolistic companies with huge resources and great and experienced management to fail miserably. Whereas, the company that actively disrupts the market can snatch critical mass from current market leaders and go to never before seen levels of success in record time. Unfortunately, most people would read this article, learn this reality and do nothing for one simple reason.

Beyond the realization of how essential it is to actively disrupt one's industry, is to actually know how a company can actively disrupt its industry. Disruption happens in sync with the way your users behave, and particularly how they behave on the internet. This varies for every industry and knowing how to take user behaviour and engineer a disruption is crucial. Disruption is a phenomenon that is easier to do looking at an industry from the outside. That is why it is usually considered the domain of startups, but that isn't always the case. What is often required is an outside perspective, preferably an expert that understands disruption to see how one can do it.

For us, at Illuster Consultants, the area of internet disruption is a focus area at the moment. And its flawless execution is essential to the survival of businesses. In the spirit of to giving back to industry, we at Illuster Consultants, are having our senior partners give free CXO/MD level executive briefings to our valued industry friends. Contact us to see if you qualify: Request CXO/MD level internet disruption primer