*A McKinsey-Award Winning Article*

Executive Summary

When Apple introduced the iPod and iTunes store, they crafted a revolution that completely changed the landscape of not only their industry but society as a whole. In the process, they created a nearly $10 billion product that they have continued to build from. While Apple is the most famous example of this brand of innovation strategy, they are not the only company that has successfully leveraged a truly disruptive business model to spark a paradigm shift.

The right kind of disruptive business model can transform an industry and result in incredible growth for an organization. In order to ascertain whether your organization needs to shift to a new business model, or alter its existing one, this article explores the following:

  1. Determine what it is that makes your existing model work, using the above components for understanding your business model. Potential questions to ask would be: does it solve a customer problem, and what problem? How is it bringing revenue to your company?
  2. Keep a lookout for signs that it is time to change your model, for example if a strong new competitor is emerging.
  3. Deduce whether reinventing your model will be worth the effort and resources. In this situation, it is important to envision whether it will be a truly disruptive business model that will change the industry or market.

The article goes into more detail regarding dissecting your business model and assessing whether an adjustment is needed.