Change is Subtle – and Sneaky…April 2006

Just about every new technology start-up has -- somewhere in its business plan -- a description of the “disruptive technology” it is about to introduce. The idea behind this, of course, is that when the new products based on this technology are introduced they will “disrupt” whatever technology or product is already out there and lead to great success for the new company. This will, conversely, cause great consternation for those companies already in business – basically it will “blow them out of the water”. Technology prognosticators and futurists also seem to be in a never-ending competition to be the first to predict the next significant disruptive technology.

All this may be wonderful for creating articles in popular science magazines, for capturing viewer interest on television shows, and for something eye-catching to put into the science section of the Sunday paper; but I am going to suggest that the concept of “disruptive technologies” is mostly wishful thinking. Basically, there is no such thing. The only times in our lives that we have disruptive events is when something truly unexpected happens to us such as when we get into a traffic accident, get a speeding ticket, or have an illness. A destructive earthquake or some other natural disaster is likewise a disruptive event. Our government leaders can also create disruptive events with their behaviors. But technology changes – very seldom, if ever, do they qualify as being disruptive to our lives.

Most technology changes take years or even decades to have an impact in the marketplace. Consumers don’t consider such changes disruptive. If consumers think the new stuff is great, they adopt it. If they don’t, nothing happens. For example, was the introduction of desktop or laptop computers disruptive? They sure changed the way we do our work, but it happened so gradually and relatively smoothly over a number of years that we hardly noticed. The first uses were mostly the same as the tasks we performed with electric typewriters. Then we discovered that we could do presentation slides and also make our typewritten work look nicer – more like a textbook. This led to a demand for printers with more capability than the early dot matrix ones that emulated typewriters. Then we did more with color and somewhere along the line we discovered that the computer could send messages over telephone lines. Initially that did not seem to be such a big deal. Wow, were we wrong in thinking that!

About the same time that desktop computers arrived on the scene we also found that a telephone could be put into a car -- and we called these car-phones “yuppie toys”. All the important technology company executives had to have one and so did all the venture folks. Then the car phone became somewhat more portable and no longer needed to be installed in a vehicle. Over the years, these phones got smaller and smaller and the capacity to communicate with them became easier and easier. Pretty soon we could not only have one to use in our own locale, we could communicate from where-ever we happened to be. And then we really went overboard and added poorly performing digital cameras to these phones. Why? That may remain as one of the great mysteries of consumer product marketing. Maybe someday, when we have the bandwidth and it costs nothing to send these pictures to our friends, this will all make sense.

Digital photography is another example of gradual change. The first digital cameras were expensive and of low resolution compared to film. Consumers had poorly performing printers to combine with these cameras and the images were nothing like the ones we could obtain with conventional film. But gradually digital camera resolution increased, costs came down, and printing technology at a consumer-affordable price became really good. Today we can mostly duplicate, and in some cases even exceed, what film-based cameras have been able to do for many years. Our computers have become capable of storing all this extra information and software is able to enhance the photos we have created with greater ease and lower cost than can be done with chemical photography.

Have any of these been disruptive technology changes? Well, I suppose if we were to ask some of our colleagues at Kodak, they would most likely tell us that they sure have disrupted what was once a nicely stable and growing film business. Perhaps similarly strong opinions would come from those folks working at the traditional landline telephone companies. And most likely, the electric typewriter business is not showing much growth these days. The same can be said for overhead projectors -- that can now be found at very attractive prices in company surplus stores.

Perhaps this concept of disruptive change is very much dependent on one’s point of view. For the consumer, these changes are quite wonderful and are received with great enthusiasm. Nothing disruptive here – just nice new benefits. But for the companies committed to a particular technology approach, the introduction of a new technology by someone else can cause some serious problems. Why does that happen so often and to such a degree? Why does it so often take new companies to create these technology changes? Why can’t the existing companies do it before they get threatened and/or put out of business?

Unfortunately, there is a very good and fundamental reason for this – something so ingrained in human nature that we should not expect anything to change no matter how many times we experience the same bad outcome. The reason we will not change is because our current behaviors are driven by a combination of survival and greed. We are rewarded for what we are doing today and not for what will happen sometime in the future. For example, do you think Microsoft can give up Windows, even though it is rapidly becoming irrelevant? (I’m amazed that my Windows-based computer is allowing me to keep typing after what I have just written).

Our computers have gradually become communication devices. How much of the day do you spend doing e-mails versus other tasks? For me it’s about 90% communications and the rest divided between image processing/manipulation and conventional word processing. Clearly Kodak has had a tough time giving up film as its core business. For some of our colleagues in CRT factories, the transition from CRTs to flat panel displays has similarly been pretty rough.

The skill sets that develop, the reward systems that go along with existing successful products, the difficulty for founders and employees to give up what is working for them currently, all lead to an entrenchment and the desire to stick with what is paying salaries today. The big monster that has been created demands continued feeding. How and why should one risk giving up what is currently producing revenue for something that may or may not work out? Telling the founders or upper management that some new concept is likely to undermine or destroy the existing successful product base may be a sure path out the door. (I can vouch for the severity of this risk from several very intense personal experiences).

Change is wonderful. Change is subtle. Change creeps up on us in unexpected ways. As consumers we get to control change – we choose what we like and we decide what to embrace – or not. As participants in new technology developments we have great freedom in exploring new directions and offering them up for marketplace acceptance. As founders of new ventures we get the chance to create something new and exciting with minimal downside risk. As employees of large established corporations we have the scary prospect that change will indeed disrupt what we have become so nicely accustomed to doing. Therefore, whether we embrace change or resist it will depend to a large extent on which role we have chosen to play.

This can be quite a paradox – the greatest certainty sometimes comes from living a life of high uncertainty. It seems that this is the path that I chose a number of years ago and it has worked out much better for me than trying to hang on to something that may have looked stable on the surface but was really not so stable after all.

As always, I invite your comments. Change can be a blessing or a prospect too scary to contemplate. Have you been able to make it a blessing in your life? You can contact me directly from this site, by e-mail at silzars@attglobal.net, by telephone at 425-898-9117, or by fax at 425-898-1727.