I just finished reading a book that will probably remain in my top-10 list for a long time: ‘The innovator’s dilemma’ by Clayton Christensen. The book was published almost 15 years ago. It hasn’t seen the rise of technologies like cloud, virtualization, smartphones and the iPad… But still, its conclusions are so true you can apply them to any recent market trend.
The book introduced the concept of sustaining vs. disruptive innovation.
Applied to business software: sustaining innovation is what you do when you listen to your customers, and stuff your solution with more and more new functionalities, or make it mobile, in the cloud, portal-based… All those nice things that you build on top of what you had already.
Sustaining innovations are good. You have to listen to your customers and make your solution more performant to address more complex needs.
But disruptive innovations are totally different. This is the kind of innovation that results from not listening to your customers in the first place. Its an innovation that puts the whole value network in a market upside down. Its something that makes established competitors unable to react appropriately (i mean what Steve Ballmer said about the iPhone and later the iPad).
Unfortunately, I can’t mention any disruptive innovation in ERP software, because there hasn’t been one for about 15 years. What I do know is that current ERP solutions suffer from severe ‘performance oversupply’ for more than 50% of the companies; and that one day a new competitor (certainly not an existing player in the market), will come with a simple, convenient, technologically not so advanced but cheaper solution that will put the whole market upside down. A solution that certainly will not arise from market research among existing customers, but from the brains of a smart who sees what customers themselves haven’t seen yet. A solution that nobody had asked for in the first place.
So, what solution? If I knew it, I would probably be writing this on my 45 ft. sailing yacht.
