Many startups owners who are obsessed with the idea of disrupting their industries, often find themselves chasing an illusive goal rather than building a strong business.
There is another option, says Dr Yudhvir Seetharam who is head of analytics at FNB Business, entrepreneurs should consider optimisation instead.
Essentially, there needs to be a paradigm shift in the approach to the use of data in informing decisions, says Seetharam. Businesses should rather use the data on hand to optimise certain processes in terms of solution offerings and service delivery, rather than chase disruption.
“Optimisation can be the ultimate form of innovation”
“In most cases, the most effective way to innovate is to use data to understand what is currently not working and simply optimise that,” says Seetharam.
Disruption – The No Holds Barred Option
Disruption is described in a Forbes article, as an idea that literally uproots and changes how we think, behave, do business, learn and go about our day-to-day.
“Harvard Business School professor and disruption guru Clayton Christensen says that a disruption displaces an existing market, industry, or technology and produces something new and more efficient and worthwhile,” the article states.
Businesses such as online marketplace and hospitality service, AirBnb, streaming service, Netflix and mobile money platform, Zoona are often touted as disruptors in their respective industries.
Is Optimisation Really Better?
Optimisation can be the ultimate form of innovation simply because unlike disruption which looks to replace what is broken in your business, optimisation looks to solve the core problem by fixing it, Seetharam says.
Along with giving your business a more easily attainable goal of helping you improve your business processes, optimisation can be a more cost effective way for completely upgrading your business.
It is described by Jack Stack, co-founder and CEO of SRC Holdings Corp., quoted in an article on Inc. as “the process of taking something you already do and figuring out how to do it better, cheaper, and faster by making incremental improvements”.
“Businesses that survive and thrive need to understand what actually drives their business – demand and supply factors; and also be able to create customisable sales conversations to enhance customer experience. These all talk to optimisation,” says Seetharam.
LOOKING TO OPTIMISE? Here are 3 ways your business stands to benefit, according to PwC.
- Improve efficiency: eliminate manual data entry, reduce process cycle time and/or reduce manual routing.
- Improve effectiveness: handle exceptions faster and better, make better decisions and/or consistent execution.
- Become more agile: adapting to change as a key source of competitive advantage and/or supporting new business models.