UNLOCKING THE CUSTOMER VALUE CHAIN - How Decoupling Drives Consumer Disruption

UNLOCKING THE CUSTOMER VALUE CHAIN
How Decoupling Drives Consumer Disruption
Introduction
The real driver of most digital disruption in markets today is not new technology. It's consumer behaviors and preferences. They are flocking to new business models which give them more control and more value. Therefore, if you want to innovate, look at changing your business model first and foremost. Specifically, get to know and see your customer's "value chain" from their perspective – what they want and the steps they undertake to get that.
The Customer Value Chain
Evaluate
Choose
Purchase
Consume
1. The new realities of today's marketplace
Traditionally, consumers completed all the value chain activities with the same company. Today's markets are now full of disruptors who break the links in the value chain and then perform one or a few of those stages themselves. Decoupling is happening everywhere. Savvy digital disruptors are performing those parts of the value chain where the most value is added and leaving others to perform the other parts which are expensive to duplicate. Decoupling is a compelling business model.
2. How incumbents should respond
3. How to build your own disruptive business
If someone is coming along and attempting to decouple your markets, there are realistically only two ways you can respond. You can either take action to recouple your customer value chain or you can preemptively decouple your CVC and seize the portion that generates the most value for yourself. Any other approach is doomed to fail. And before you decide which approach to take, you have to understand the respective upside and risks of each approach. That requires a meticulous analysis.
Building and growing your own disruptive business all comes down to revisiting and rethinking established paradigms nobody else has challenged yet. Apply the basic concepts of decoupling and you'll see opportunities to disrupt all around. This can work whether you're an industry outsider looking in, an intrapreneur starting a new venture inside an existing business or a startup looking for a new and innovative idea to monetize. The challenges of building a disruptive business always fall into three categories which correspond to the life cycle of an enterprise:
START
GROW
DECLINE
How to cost-effectively acquire your first 1,000 customers
How to decide which new products to develop and markets to conquer
How to counter a stall in growth and innovate into or out of markets
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