An Excerpt from Beyond Disruption

Disruption dominates innovation theory and practice. But disruption, for all its power, is destructive—displacing jobs, companies, and even entire industries. Are we missing an alternative approach to innovation and growth?

With three decades of research, the #1 global bestselling authors of Blue Ocean Strategy, W. Chan Kim and Renée Mauborgne, reveal another way to innovate and grow. Just as Blue Ocean Strategy redefined the essence of strategy as creating not competing, Beyond Disruption redefines and expands the existing view of innovation by introducing a new approach, nondisruptive creation, that is free from the destructive displacement that happens when innovators set out to disrupt.

A practical guide for driving innovation and growth, the rich research behind the book, coupled with its frame-breaking message, make it the must-read book for the next generation of innovators.

The excerpt below was adapted from Chapter Five: The Three Paths to Market-Creating Innovation and Growth. 

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The Path to Nondisruptive Creation: How E-Sports Creates a New Industry without Disruption 

Organizations that identify and solve brand-new problems or create and seize brand-new opportunities outside the boundaries of existing industries unlock nondisruptive creation.  Nondisruptive creation generates new industries and strong growth but without leaving failed companies, lost jobs, and destroyed markets in its wake.   

Instead of looking for breakthrough answers to existing industry problems, this approach begins with asking: Are there brand-new problems we can solve beyond existing industry boundaries? Are there brand-new opportunities we can unlock outside those boundaries? As your focus shifts in this way, so do the opportunities you see to create new markets that eat at neither the margins nor the core of existing industries and established players. In this way, virtually all the demand created is new, resulting in nondisruptive growth.  

While all brand-new problems that are solved in effect result in new opportunities, not all brand-new opportunities are created by addressing new problems. Many of them are generated by spotting and unlocking newly emerging value that is not linked to any unaddressed problem or pain.  

Consider e-sports: a nondisruptive market offering that addresses an aspiration rather than a problem of youths today. E-sports involves almost no physical activity—just hand-eye coordination, precise timing, skillful planning, and click speed, as an audience watches teams play online video games in massive arenas, their every move projected on panoramic screens. With up to 50,000 in attendance at top e-sport championships and some 100 million watching online in dozens of languages, e-sports has become one of the hottest, most lucrative sports on the planet.  

Game makers in the past focused mainly on creating and selling games that were exciting to play—the kind that inspired diehard video-game geeks to lock themselves in their rooms. In the early 2000s, however, game makers saw a chance to create and seize an opportunity outside the existing industry boundaries.  

In Korea, where gaming is part of the country’s mainstream youth culture, game publishers observed that gamers and non-gamers excitedly followed online gaming tournaments, commenting on players’ tactics and discussing their favorite players and teams in chat rooms.  

Game publishers began to realize that there was a huge, untapped market of people who wanted to watch others play, whether or not they were gamers themselves—just as people enjoy watching basketball or tennis whether or not they play the game. They also saw the excitement and revenue that could potentially be generated by bringing together top gamers from around the world to compete in person for meaningful prize money. The gamers would get the glory of global recognition, the audience would be able to see their favorite players up close, and both would feel the excitement that spectator pro sports have always enjoyed—the thrill of a crowd.  

So, game publishers started to design games with the aim of creating e-sports, a full-out live spectator sport. That meant creating multiplayer games like Riot Games’ League of Legends and Valve and Hidden Path Entertainment’s Counter-Strike: Global Offensive, which were as much fun to watch as they were to play, and in which skill and strategy, not luck, were the key to winning.  

Game makers, along with third-party e-sports organizers, created professional leagues and tournaments around the most skilled players to produce spectacular in-person events and then entered into lucrative agreements for the events to also be broadcast and cast live to fans around the world. In this way, e-sports was crafted into a spectator sport that was separate and distinct from gaming itself.  

E-sports took video gaming from kids in a basement to a physical, in-person, pro-sports event. Today, the industry is bigger than ever, with more than $1 billion in revenue and some 175 million e-sports fans around the world. Yet no other pro sport has been disrupted or seen its revenues decline as a result. In fact, more and more pro-sports teams and players see e-sports as a burgeoning growth opportunity for them: members of the New York Yankees in baseball, Magic Johnson and the Houston Rockets in basketball, and the New England Patriot’s NFL owner Robert Kraft have bought into the sport.  

E-sports created a billion-dollar nondisruptive market by capturing a newly emerging opportunity across the globe. Just like Viagra, GoPro, Post-it Notes, and microfinance it was a brand-new offering that lay outside existing industry boundaries, creating new growth and new jobs without displacement.  

Reprinted by permission of Harvard Business Review Press.
Excerpted from Beyond Disruption: Innovate and Achieve Growth without Displacing Industries, Companies, or Jobs by W. Chan Kim and Renee Mauborgne.
Copyright 2023 Harvard Business School Publishing Corporation.
All rights reserved.

About the Authors

W. Chan Kim and Renée Mauborgne are professors of strategy at INSEAD and codirectors of the INSEAD Blue Ocean Strategy Institute in Fontainebleau, France. They are the authors of the over 4 million copy global bestseller Blue Ocean Strategy, which is recognized as one of the most iconic and impactful strategy books ever written, and the New York Times, #1 Wall Street Journal, USA Today, and Los Angeles Times bestseller, Blue Ocean Shift. To date, Blue Ocean Strategy and Blue Ocean Shift teaching materials have been adopted by over 2,800 universities across the globe. They were named the most influential management thinkers in the world by Thinkers50.

To learn more, visit blueoceanstrategy.com and twitter.com/blueoceanstrtgy