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Why Is Digital Disruption a Thing for Technology and Service Providers?

by David Yockelson  |  February 8, 2018  |  Submit a Comment

Technology and Service Providers (TSPs) face several major issues:

–They may develop or integrate disruptive technologies but face difficulties differentiating their offerings (e.g., everyone is embedding AI).

–Barriers to competitive entry are low and so are buyers’ attention spans; what can be done to disrupt a market AND make buyers take notice?

–They often struggle to convey value – particularly disruptive value – in the context of their customers’ business or organizational needs

–Emerging providers with disruptive products or services want to compete with the established; established providers need to defend against incursion from the emerging and recapture a “change the world” mentality.

We know that many people are already experiencing “disruption fatigue”.

disruption fatigue

However, the fact remains that TSPs need a disruption playbook to capitalize on the technologies, business models, societal changes, and other elements that can help – or hamper – their go-to-market (GTM).

What is Disruption?

  • When fundamental change is driven BY one or more of the elements, or
  • When fundamental change is driven IN one or more of the elements

Blockchain is a potentially disruptive technology because it can drive fundamental change in a process (contracting), industry (logistics, banking), etc. BlockchainsRUs is a disruptive provider if:

  • It’s changing an industry, changing societal convention, etc. through its products/services
  • It’s running roughshod over competitors by using revolutionary pricing, delivery, selling, etc. methods

What’s NOT disruptive? I’ve blogged about this here, but in short, a quote from a provider that says that their blockchain implementation is disruptive because: “…we’ve shown that blockchain can work on many of the most common barriers in supply chains. We’ve used the technology to securely digitize, automate, and store critical paperwork. Early testing demonstrated that we can significantly reduce administrative costs, which at the time of testing could be as high as 15% of the value of the goods shipped.” — isn’t disruptive since nothing appears to be fundamentally changed or improved from what BPM, document imaging, EDI, or about a half-dozen other technologies could offer.

So how should TSPs approach disruption? It’s not a marketing speedbump like the above, nor is it necessarily – and often isn’t – a “tear it all down and start over” mentality. Rather, disruption for TSPs should have three strategic components:

–A willful disruption strategy (encompassing some or perhaps all of offense, defense, self-disruption, serendipity, and anarchy) that translate to business, technology, and operational strategies and tactics.

–A consideration of how to use the elements of disruption (technology, business/economics, industry, and society) to influence GTM strategies and tactics.

–A plan or method(s) to help customers understand and find business moments to convey disruptive (or not) value.

elements

Gartner has an entire agenda this year (that I am managing) that is focused on these principles. You can find all the details here. A foundation document that discusses specific tasks for each leadership role in a TSP’s organization can be found here. I and many others have been and will be writing and speaking about the application of three disruption strategy components above, including reports on how to take advantage of disruptive technologies like digital mesh and conversational AI platforms; we also have research on organizational imperatives and constructs to help imbue organizations with the ability to willfully disrupt…and continue to do so over time. I look forward to sharing insights on all this work with you all.

Category: digital-business  digital-disruption  go-to-market  gtm  product-management  product-marketing  

David Yockelson
Research VP
1 years at Gartner
30 years IT Industry

David Yockelson is a Research Vice President on the Tech Go-to-Market and Sales Strategies team in the Technology and Service Provider Research organization.. Read Full Bio




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