Understanding the Disruptive Business Model

There’s a good chance that you’re seeing aspects of the disruptive business model every day. This business model doesn’t focus on traditional methods of success. It says that there is always a better way to get things done. That doesn’t mean change happens just for the sake of saying that change is happening. This business model forces everyone in an industry to examine what they are doing, look for a better path, and strive to be a little bit better each and every day.

There are many variations of the disruptive business model, but just one truth: innovation and creativity are the heart and soul of it. Without creativity powering the movement, there cannot be any disruption. That’s because people will ultimately be satisfied with traditional practices and traditional results. Here are some examples of the disruptive business model and how they’ve affected lives in sometimes very personal ways.

1. Online Advanced Education

In the traditional business model of education, students were required to attend physical classrooms to be taught. Thanks to the internet, this business model was disrupted with the innovation of the online educational system. Students can start in kindergarten with an online class and earn a PhD today in their preferred field one day with almost all of it being online. Not only has this saved student’s money, but it allows people to remain productive in jobs while they secure an advanced degree.

2. Crowdfunding

Crowdfunding might be the ultimate disruptive business model. It has changed the way that start-ups can obtain the financing capital they need to get a business off the ground. It has changed the way a business markets new ideas to targeted demographics because an entire demographic can be tested immediately. It has even changed how people approach their own creativity because any great idea has the chance to be funded.

3. E-Books

The printing press might have been one of the greatest inventions in human history. It means that books could be mass produced instead of directly copied. The publishing industry was disrupted thanks to the addition of e-books that don’t even need to have a traditional publisher to be distributed. Anyone with a computer and the ability to save a PDF file can legitimately publish their own e-books. Instead of finding agents and publishers and going through hundreds of denial letters, authors can promote their own work from Day 1.

4. Blogging

It wasn’t that long ago that the biggest worries the newspaper industry faced was a shortage of newsprint paper. Now newspapers are slowly dying thanks to the instant journalism that happens on the various blogs that are regularly updated all over the internet. Some news sites have even adopted the blogging style for their journalism and have a 100% digital footprint for the news. This disruption to the world of journalism has changed how people consume news and how much they choose to consume.

5. Smartphones

It wasn’t that long ago a brand new 250 MB hard disc drive would cost $120,000. A Tandy 386 that had a 20 MB HDD was considered a top of the line computer that would cost over $1,000 brand new. Today smartphones can carry gigabytes of data, give people instant access to the internet, and still make phone calls for a fraction of the early costs. Technology in every industry is very much a reflection of the disruptive business model because it is always improving, adapting, and changing and this forces everyone else to evolve.

6. Music Subscriptions

Instead of purchasing a single or an entire CD to get a song, everything has become available online in the music industry. There’s been a double disruption n this industry over the last decade. Apple started it when iTunes allowed for individual songs to be downloaded instead of an entire album for about $1. The music subscription services like Spotify have changed it again by allowing unlimited streams of legal music, including offline downloads as well, for a flat monthly fee.

The disruptive business model forces an entire industry to keep testing itself to see if it can find a way to be better. Some results aren’t positive at all and a business practice this model goes under quickly. Sometimes the results bring in massive amounts of success to the tune of billions of dollars.

The lesson learned here is simple: in this modern world, if there is not a continual focus on innovation, then a business will die a slow death.

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