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3 Stories of Disruptive Innovation

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Long before “disruptive innovation” became a catchphrase of the business world, Henry Ford made waves by introducing the 5-day work week (with 6 days worth of pay!) and perfecting assembly line techniques for the Model T. Middle class America flocked to Detroit in droves while auto manufacturing executives elsewhere tried to wrap their heads around the concept.

Today, the concept of creating a new market by displacing outdated technologies or tactics with the shiny and the new has taken on the glamour of stardom. The intense scrutinization of Steve Jobs after his death (both praise and blame for his methodology) bore witness to the glamorization of successful tech companies. Journalists alternatively approved his methods and damned them—yet despite their research failed to uncover the trade secret that allowed Jobs to push Apple ahead of competitors again and again.

While entrepreneurs everywhere search for that elusive trade secret that makes the disruptive innovations of tech companies like Netflix, Apple and Amazon hugely successful, here are a few less star-struck stories about disruptive innovation— how the stage was set, who started the engine powering each ingenious plan, and how they forever changed the way we do business.

1. Sears Roebuck Mail Order Catalog

Like Ford, who perfected the assembly line and thereby took over the market, Sears Roebuck’s mail order catalog catapulted to the forefront of their industry, offering to deliver to your doorstep any product you could possibly imagine.

In Myth, Magic & Marketing, Walt Keunstler discusses Sears Roebucks disruptive innovation techniques as bordering on the supernatural, the magical solution:

“In its day, mail order was as miraculous as the Internet has been in ours. Sears Roebuck brought the store (and it was the world’s biggest store!) right to your kitchen table—wherever that table might be located. The railroad and the US Postal Service were the magic connectors enabling anyone, anywhere, to purchase virtually anything to be shipped anywhere in the United States.”

And it is precisely this concept of the magical solution, the “djinni from Aladdin’s lamp” that contributes to a disruptive innovation’s success. By offering seemingly magical solutions—as Amazon and Netflix and Apple have also done—a company is able to carve itself a new market, or overtake an untapped market in an unprecedented way.

2. 37Signals

An unlikely story of massive success (37Signals only has 35 employees), this web design firm turned software company turned hub for new age business experimentation has innovated time and time again. Four-day work weeks during the summer months, discretionary spending accounts—you name it, 37Signals thought of it first.

Basecamp, their (in)famous web-based project management software, surpassed the three-million user mark back in 2009. Today their website boasts “over 7,000 companies sign up every week.” These statistics are exceptional, especially considering their double digit employee count.

For a constant companion and reference guide to innovation in the tech world, keep your eye on 37Signals, particularly their Signal vs. Noise blog.

3. Baby Carrots

Yes, seriously—baby carrots. Don’t think I’m kidding about this innovation. In the 1980s the introduction of baby carrots became a disruptive innovation that transformed the supermarket, the carrot manufacturing industry, and the way the beta-carotene rich vegetable is consumed in households across the United States.

Like many business innovations, the introduction of baby carrots was born out of a desire to mitigate waste:

“[Mike] Yurosek was unhappy at having to discard as much as 400 tonnes of carrots a day because of their imperfections, and looked for a way to reclaim what would otherwise be a waste product. He was able to find an industrial green bean cutter, which cut his carrots into 5 cm lengths, and by placing these lengths into an industrial potato peeler, he created the baby carrot.”

In Summary

While business journalists try to reverse engineer disruptive innovations, your time as a businessperson is best spent looking for opportunity, recognizing it, and seizing it—as those in the stories above did. Mike Yurosek didn’t plan for the baby carrot’s success, nor, in all likelihood, did he care about transforming the industry: he just wanted to make better use of his materials. The rest is history.

This is a guest post by, Matt Heron. Matt writes and crafts digital products at The Phuse. You can find him on Twitter.

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