Joseph Schumpeter believed that the process of invention to create a new commercial product or service was the key to creating new demand, and new wealth.
Entrepreneurs could start up or growth their businesses by exploiting suitable inventions.
This creation would “freshen” up the market and those companies unable to respond may well have outlived their economic usefulness (Destruction).
Clearly these entrepreneurs are not responding to changes, more making changes and making markets. There is therefore an emphasis on education of the consumers of the new product.
To achieve this takes a special motivation and a special vision.
Can you recognise destruction or potential destruction in a business from talking to them?
Consider this possibility.
Imagine you are the best in your field, and your company has the best technical people.
You have a monopoly – you probably charge too much for your people’s services, and you may over engineer your solutions.
If there was a solution available to the market place that could deliver “your” expertise at a cheaper cost or watered down the need for engineers, what do you think your technical people would say?
If the competitive advantage of your company has been its technical people, who may win through in the short term?
It may therefore be useful to watch our for the signs of destruction, and when you think it may endanger the long term success of your company.
It is also useful to remember that when you are caught up in a new product, and you can see why everyone should use it, you shouldn’t forget that all your potential customers may not have the same vision. Your task is much larger.
Roger Croft is Managing Director of the PRD Partnership. PRD help companies commercialise their ideas into new products, services, or processes. He also writes and delivers courses and seminars for the University of Bath Small Business Hub. firstname.lastname@example.org http://www.prdpartnership.com
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