Disruption
The pandemic has been catastrophic for many businesses. More than 9,300 stores closed in
the U.S. in 2019; another 5,800 closed the year before that. With quarantines and stay-at-
home mandates, businesses were hard pressed to keep their doors open. The environment --
and the state of the economy -- demanded a new approach.
Digital transformation helped to change "business as usual" to "whatever it takes". Survival
now requires the ability of businesses to re-imagine, re-design, and re-invent themselves to
stay ahead of the competition. That included building new business models to help disrupt
the status quo and help innovate across the enterprise.
Forrester said it best:
"Today's fastest growing companies didn't get where
they are by using the same business models as their
competitors or incrementally innovating using the
same tried and true practices. Instead, they changed
the game with technology. They jumped on trends,
pioneered new digital models, and offered products
and services that differentiate with insight. And they
did so ahead of their competition."
Forrester also found that firms with advanced
technology-driven innovation practices are growing
Definition
dis·rupt·or
noun
A company or form of
technology that causes
radical change in an
existing industry or market
by means of innovation.
Consumer Direct Offense (CDO): this simple strategy eliminated its wholesale distribution
business, replacing it with direct sales to consumers. By focusing on its ever-growing
digital footprint, it changed it business model completely.
3.6 times their industry average, while beginners are shrinking – and none of this is true or
possible without disruption.
In the retail industry, Nike is a perfect example of digital transformation done right. Nike
represents the largest seller of athletic footwear and apparel in the world. Its aspiration to be
the leading digital-first, direct-to-consumer (D2C) company is widely known. By leveraging its
growing investments in digital technologies, Nike set a goal for e-commerce revenue to reach
30% of total sales by 2023. They were so successful, they hit that goal two years earlier. Now it
expects ecommerce revenue to reach 50% in 2022. At the same time, Nike's D2C sales raced
from $2.5 billion in 2010 to $16.4 billion in 2021.
Its approach was clever. It instituted two core strategies company-wide:
DEMAND, DELIVERY, DISRUPTION | 9
