Disruptive Innovation

Lessons from Donald Trump’s Victory

Posted by Aj Khan on November 20, 2016

Donald Trump’s Victory over Hillary Clinton in the 2016 US Presidential elections is a politically and socially significant event in modern history. This is not only true for USA but indeed the entire world and the established global order may face significant headwinds from the new political order. However, another significant aspect of Donald Trump’s victory is the manner in which it has caused disruptive innovation to the entire political system in USA. From the “establishment wings” of both the Republican and Democratic Parties, personified by the Bush and Clinton families, to the entire army of political pundits, pollsters and media, no one saw this happening and this election will be analyzed for years to understand why the vast majority of experts never predicted a Donald Trump victory.

Wikipedia defines Disruptive Innovation as “an innovation that creates a new market and value network and eventually disrupts an existing market and value network, displacing established market leading firms, products and alliances”. Donald Trump did exactly that to the US political system. Below are few insights which the practitioners of innovation can take away from this election result.

Job to be Done: Innovation happens because someone comes along and redefines the “Job to be Done”. Edison wasn’t just trying to improve candles but he defined the Job to Be Done as something which creates light. In a similar manner, Donald Trump’s aim was not just to become the President of the United States of America. He redefined the entire mission of his campaign to challenge the entire political establishment and in so doing created new ground realities.

Understand your (Potential) Customers Pain Points: In order to “disrupt” a market, one needs to understand why the customers are not satisfied with the current offerings. It’s not enough to know that the customers are unhappy with the current offerings but the real question is WHY. To apply the question of “why” to the US political landscape prevailing in the years before the 2016 elections, why was a sizeable portion of the electorate unhappy with the traditional political establishment? Why is it that the policies of both major parties in US were not good enough for the voters? Why are people so against traditional politicians?

Most traditional political candidates did not even appreciate that there was a sizeable number of voters angry enough at the establishment to vote for someone with a totally different message. Other candidates such as Bernie Sanders and Ted Cruz did understood this phenomena but Donald Trump was the ultimate champion of disruption.

Communicate: Communication is essential to drive innovation. This is not only important to nurture the initiative but also to make everyone understand the brand’s new value proposition. In this regard, whether we agree with Donald Trump’s message or not, his “messaging strategy” was very effective. His simple message of “Make America Great Again” addressed his potential customer’s pain points and his use of free media began the process of acceptance and diffusion essential to any new offering i.e. a possible President Donald Trump. Donald Trump understood that communication is essential to support rapid innovation based on the following three fundamental steps:

• Communication as a way to test the coherence between the brand and the innovation;
• Communication as an essential asset to develop innovation;
•Communication as a tool to spread innovation.

New metrics to measure growth: The day after the elections, on 9th November 2016, the question was how everyone could be so wrong? Why no one could correctly predict the elections results? What went wrong with the polls? The answer is simple. Disruptive Innovation needs new metrics

According to Clayton Christensen, the person who coined the term disruptive innovation, “the characteristics of disruptive businesses, at least in their initial stages, can include: lower gross margins, smaller target markets, and simpler products and services that may not appear as attractive as existing solutions when compared against traditional performance metrics”. This is precisely the reason that, such disruptive innovation models are unattractive to other entities operating in the same market. But most of these traditional entities are measuring metrics which do not matter anymore.

To use this analogy for the just concluded US Presidential elections, maybe a better measure would have been to measure voter issues rather than to ask them who would they vote for. Measuring the impact of Job losses, loan defaults, mortgage delinquencies, etc. on voter behavior might have more accurately predicted the end result of the 2016 US Presidential elections.