Renée Mauborgne, author and speaker on innovation and growth, joins the podcast to discuss non-disruptive creation and its role in driving economic growth while avoiding negative aspects of disruption. Topics include identifying and inventing non-disruptive creations, the role of disruptive creation, challenges and capabilities needed for non-disruptive creation, the influence of AI, and the success of the book Blue Ocean Strategy as a disruptive technology in the field of strategy.
Non-disruptive creation allows companies to pursue profit while also being good for society by creating new industries without displacing anyone.
Non-disruptive creation offers advantages in terms of entry, incumbency, internal stakeholders, and external support.
Deep dives
Non-disruptive creation: Creating new markets without displacement
Non-disruptive creation is the concept of creating new markets where there once weren't any, without displacing industries, companies, or jobs. It is a flip side of disruption and focuses on uncontested spaces or creating new spaces. This approach is different from traditional blue ocean strategy, which seeks to create new markets across existing industries. Non-destructive creation occurs outside existing industries, creating new opportunities and avoiding social pain or job displacement. It offers advantages in terms of entry, incumbency, internal stakeholders, and external support.
The growing importance of non-disruptive creation
Non-disruptive creation is becoming increasingly important due to various factors. There is a growing movement to shift away from solely focusing on shareholder profit maximization and toward considering the broader impact of business activities on society. Non-destructive creation allows companies to pursue profit while also being good for society by creating new industries without displacing anyone. Additionally, with the rapid acceleration of technology and the potential displacement of jobs, non-disruptive creation becomes a crucial strategy for creating new industries and absorbing released labor.
Four types of advantage for non-destructive creation
Non-disruptive creation offers four types of advantages: entrant advantage, incumbent advantage, internal advantage, and external advantage. As an entrant, non-disruptive creation allows for the creation of new markets without competing directly with established players or overcoming high sunk costs. For incumbents, non-destructive creation offers an alternative to full-on disruption, allowing them to innovate and adapt by creating new opportunities. Both internal stakeholders and external factors benefit from non-destructive creation as it is easier for stakeholders to accept and involves less negative backlash from society or governments.
Identifying opportunities for non-destructive creation involves two approaches. The first is to identify existing issues or problems that have long been taken for granted within an industry. The second approach is to explore emerging changes in the economy, society, or demographics that may give rise to new problems or opportunities. Companies can find non-destructive opportunities right next to their current businesses, such as creating parking opportunities in empty spaces between buildings. By encouraging a mindset that emphasizes non-destructive creation, companies can discover new spaces and unlock potential for profitable growth.
In a new book with longtime collaborator W. Chan Kim, Beyond Disruption, Renée Mauborgne describes an alternative path to pursue innovation and growth. Non-disruptive creation taps into a new market outside or beyond the boundaries of existing industries, to not only drive economic growth but also have a positive impact on society by avoiding the negative aspects of disruption, like job displacement.
Together with Martin Reeves, Chairman of BCG Henderson Institute, Mauborgne discusses the rising importance of non-disruptive creation given increased sensitivity to the social impact of business. She explains the differences between non-disruptive creation, disruptive creation, and blue ocean strategy and provides tools for companies to identify and unlock non-disruptive opportunities.
Mauborgne, a professor of strategy at INSEAD, is also the co-author of the influential Blue Ocean Strategy and has been recognized by Thinkers50 as one of the World’s Most Influential Management Thinkers.
Key topics discussed:
00:53 | What is non-disruptive creation (NDC)
08:27 | How companies can identify and invent NDCs
16:01 | The role of disruptive creation
21:08 | Challenges and capabilities needed for NDC
23:53 | AI and NDC
26:22 | Renee on coining NDC
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