Disruption is where you don’t expect it!

I love aviation, and I love flying…especially in small planes and helicopters. When my wife and I recently visited the coast of Maine, I found a flyer in our hotel lobby about scenic flights in a Bell 47G helicopter (it had been my dream to fly in this chopper).

We decided to stop by the airfield, which is close to Belfast, ME. The owner (who is also the pilot and instructor) was preparing his helicopter for an instruction flight. That, of course, drew my attention. We started talking and he told me that he could give me a lesson, as well. I definitely wanted to seize this opportunity!

The Bell 47 G

When we arrived at the airfield the next day, the 1954 Bell 47G helicopter was waiting for me to have my first real helicopter lesson (I fly a big RC helicopter, so I know the basics of how a helicopter is controlled). Some things that stand out are how sensitive the controls are—you hold the cyclic stick just with two fingers and the helicopter follows the slightest inputs. Also, flying over the coast keeping the rotor disc in relation to the horizon and doing only very little corrections on the controls. I could talk about this exciting experience forever. To make a long story short: I couldn’t get the grin off my face for hours. It was a dream come true!

After the class, the pilot and I talked casually about flying, and then about his business in general. He told me that he can no longer make a living through flying—there is just too little demand nowadays. Sadly, he told me that he has to close his business soon. The two helicopters he owns (the Bell 47G I flew with and an older Bell 47D, both in excellent shape) are for sale.

Debriefing after the flight while the engine is cooling down

His helicopter business has been disrupted—by digitalization! Previously, he made most of his money through aerial photography. His biggest clients were real estate firms that needed scenic pictures of the gorgeous houses along the Maine coast. Until a few years ago, the only way to get perfect aerial photos was from a helicopter. You wouldn’t even use a plane because they move constantly, unlike a helicopter, which can stand still (hover) in the air.

Done for now

But who does the job now? Drones! Even though they are bigger and more professional, they are pretty much the same drones you can buy in a toy store. The technology is the same! Microprocessor-controlled gyros, combined with GPS and cameras, sends pictures directly to your remote control. Wind gusts are not an issue for drones because they stay pinned at exactly the same position, no matter what.

This technology has matured within the last few years and is widely available today. Regulations will be developed, but they will definitely be less strict that the those for “real” helicopters.

Taking aerial photos with drones is much easier, much cheaper, and much faster than hiring a chopper with pilot plus photographer. Digital technology has made it possible to control a strange flying machine like a multicopter with several up-pointing propellers.

This is yet another industry that has been disrupted, although I never would have thought about it without this experience. In the Financial Times panel discussion I attended last year, I said “It’s all about imagination. ” Sometimes it’s obvious that an industry will be disrupted by new technology. Kodak invented the digital camera, however, the top management couldn’t see the highly disruptive character of their own invention and stuck for too long to print, where Kodak had been successful with for more than 100 years. Please find more information in my article “Why Digital Optimization And Industry 4.0 Is Not Enough!”.

Innovation distinguishes between a leader and a follower. – Steve Jobs, 2001


Nokia Communicator

The same is true of Nokia, who did nothing to challenge the new iPhone in its first year. After that, it only took Nokia four years to decrease from 50% market shares to a mere 5%. Within six years, the 5th most valuable brand in the world was so obsolete that the smartphone division was sold to Microsoft.

Another similarity between Nokia and Kodak was innovation: they invented the Nokia Communicator in 1996, a revolutionary—but expensive—device that was ahead of its time. However, that didn’t help. After they were unsuccessful with Windows-driven smartphones, the brand became history in 2014.

It is very difficult to identify disruption when you’re buried in day to day business. Understanding digital transformation, disruption, and digitalization requires major effort in every business:

  • strong involvement in new technology: how can it affect your business model
  • observing the market
  • realizing the smallest signs of what your competitors do
  • proactively seek opportunities of digital technologies as they appear

It’s all about innovation and new digital business models. Being a follower in technology doesn’t help.

Many follow-up discussions I have with those who attend my sessions at conferences make it clear that too many businesses, especially SMBs, don’t do any of the above. There is a prevalent belief that the digital hype will disappear one fine day, and that they only need to wait until everything calms down again for business to return to normal. In the meantime, they keep optimizing their production and processes, and products the way they always did.

The question is: how can we, as digital evangelists in our organizations, persuade the board, the executive team, and the CEO that we have to act? This is not about technology at all! It’s about creating a sense of urgency within the executive team. When I talk to peers, it seems ever so difficult to even pique their interest in the opportunities, as well as the disruptive character of “Digital.” However, I strongly believe that Digital Transformation must follow a top-down approach. If the board and CEO are not fully supportive, it won’t happen.

From all I’ve heard during networking breaks at several conferences, I’m rather pessimistic regarding the survival of many SMBs. Most aren’t even at a level where they have mastered digitalization (see my article “Don’t confuse Digital Transformation with Digitalization!”, i.e. they still struggle with too much paper in the organization for business critical processes. Excel sheets—instead of a workflow integration of the ERP system—is their understanding of digitalization. How can you question your current business models if you don’t even apply the technologies that have been available for many years now? By now, businesses should have removed paper from the process.

The lesson we need to learn is that disruption due to digital technologies is everywhere. It is usually difficult to see. It takes effort and imagination to foresee the risks and opportunities involved. Let’s be clear, it is mainly about opportunities! Digital technologies, such as cloud, IoT, AI, etc. will allow unprecidented business models!

I am highly interested in your opinion. Do you agree, or disagree? Write a comment with your ideas on that.

About Alexander

Alexander Buschek is passionate about Digital Transformation and the opportunities it gives businesses—especially MSEs. He is convinced that every business has to embrace Digital Transformation in one way or another in order to survive. The sooner a business begins its Digital Transformation, the better. Alexander was the CIO / CDO of Braunschweiger Flammenfilter and CIO of Cherry GmbH. Prior to that he was an entrepreneur, consulting MSEs about IT strategies, providing external project management, and overseeing various IT projects (e.g. ERP and CAD implementation and migration). Working with many MSEs gave him a deep understanding of this market. Alexander is now Senior Director, Analyst (MSE) at Gartner.