Last night I spoke at a dinner for a selection of retail and property professionals. One of the key themes that came out of it was the difference between iterative and disruptive innovation. It’s sometimes hard to separate the two. What does it mean to be truly disruptive?
Over dinner we focused on the property industry and the high-buzz world of ‘proptech’. For the most part, proptech has been focused on stripping friction from the process of finding and buying or renting a property.
There is a huge amount of friction to be removed from this process, so even though the technologies being applied to the problem are no longer necessarily novel, their impact is significant. If you can strip half — or more — from the time taken to complete a transaction, isn’t that disruptive?
Measures of disruption
It certainly is by the measure of disruptive innovation that I have used in my consulting work. Here, I would define any innovation as disruptive if it can at least halve or double the relevant metric that it affects, whether that is turnover, profit, churn or anything else.
But that’s a purely quantitative measure. Rightly or wrongly, I feel like there ought to be a qualitative measure to disruptive innovations. They ought to be unexpected and novel, not obvious and predictable.
Mature markets and laggards
Most of the time, the qualitative measure works. In mature industries, there is usually very little that can have such great effects that isn’t unexpected or novel, so anything that clears the quantitative bar also passes the qualitative test. But in sectors like property that are arguably lagging on technology adoption, that measure breaks down.
Can something be described as disruptive, if it is really a predictable iteration of current practice or the application of simple technologies to an obvious problem?