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The quest to disrupt has become Silicon Valley’s crusade and startups across the world are shaking up existing industries. Former Cisco CEO John Chambers predicts that “40 per cent of businesses in this room, unfortunately, will not exist in a meaningful way in 10 years”, Cisco CEO John Chambers at the giant Cisco customer’s conference in 2015.
Europe is lagging behind. A McKinsey study claims that only 12 per cent of the digitalization potential has been used to date, compared to 18 per cent in the USA (Bughin et al., 2016). The first round of digital transformation was won by Silicon Valley. New technologies are changing the entire economic structure, society and the way we live, work and consume with breathtaking speed. The digital transformation is unprecedented in terms of speed, range and impact. The combination of individual technologies offers unparalleled new possibilities. Bringing together emerging technologies such as cloud computing, artificial intelligence, robotics, 3D printing, smart devices, big data or social media has led to entirely new products, services and business models across industries. The challenges are enormous. Many of the digital changes are disruptive. They are changing industries fundamentally. New business models replace traditional ones in ever shorter time intervals. Many established companies are struggling. They underestimate the dynamics, react too slowly and are sticking to their existing business models.
This pattern of disruption is remarkably stable. It characterizes most disruptive changes in business history (Christensen, 1997) and still holds true in the age of digital transformation: Netflix killed Blockbuster, Amazon disrupted the retail industry, and it was not the “Big Four” music labels that introduced MP3 or streaming business models. The digital transformation is revolutionizing every industry, and the disruptors very often are new entrants while incumbents face the innovator’s dilemma. Their business models and their core competencies make them good at sustaining innovation but hinder them in disruptive changes. A worldwide IMD-CISCO survey of more than 800 executives across twelve industries found that, depending on the industry, the established companies within industries are the least likeliest to disrupt (Bradley et al., 2015). Up to 25 per cent of the disruptions will come from companies outside an industry, and between 25 and 50 per cent of the disruptors will be...