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Disruption and Product Market Fit

By May 8, 2021June 3rd, 2021No Comments

Is there really that much difference between Disruption and Product Market Fit?
Most start-ups talk about getting to product market fit, and go fast, go big.
Most big businesses talk about being disrupted by smaller competitors or that the market is being disrupted by new technologies.
Most of the time and in this context they’re after the same thing but at different stages of business maturity and growth.
Danny Holtschke gives a comprehensive view of the three types or views of Product market fit here, where he breaks them down as

  1. Market View: Marc Andreessen
  2. Business View: Steve Blank
  3. Product & analytic View: Eric Ries, Ash Maurya, and Dave McClure.

Points being…
The #1 company-killer is a lack of market (ability to scale).
So;
Customer Discovery = Achieve problem solution fit
Customer Validation = Achieve product market fit, Is it what the customer wants (must-have!)?
and;
Customer Creation (on boarding at scale) and Company Building = ability to scale as a business. Will they pay for it? (viable), Can it (pain) be solved? (feasible)
Mitt Tarasowski has written a simple explanation here in the form off a mini case study of Trello vs Atlassian for anyone who just doesn’t understand disruption (in the context of technology, but the principle can also apply across other industries).
In Atlassian’s case while the company’s revenue grew, its product became overly complicated and difficult to maintain.
Whilst Trello which was more of a visual kanban solution began to take on features that could potentially fill the gap, or vacuum as Clayton Christensen outlined in The Innovator’s Dilemma, that Atlassian was itself creating through growth.
It’s very simple, the start-up provides “80% of the benefit for 20% of the cost”, is sometimes seen as the ‘shiny new toy’ and starts to hoover up the competitions customers.
Products based on disruptive technologies are typically cheaper, simpler, smaller, and more convenient to use.
At this point there are two choices for the larger enterprise company; go head to head with the disruptor OR take them out of the market by acquisition.
Now there is another dilemma… disrupting the disruptor. As the start-up grows and starts to mature as business it starts to become like a bigger organisation it expands it’s workforce and puts in place processes which typically slow things down.
if you’re in a start-up or responsible for innovation in a larger company remember the phrase small is beautiful. It’s easier to maintain a competitive edge when you’re small, you’re certainly more agile.
Jason Fried may have nailed it with 37 Signals 
“No growth-at-all-costs. No constant, churning false busyness. No ego-driven decisions. No keeping up with the Joneses Corporation. No hair on fire.”
As an aside here’s two great resources for spotting tech start-ups performance:
Product Hunt https://www.producthunt.com/
CB Insights: https://www.cbinsights.com
See also: http://agilebusinessmanifesto.com/agilebusiness/hidden-treasures-in-digital-transformation/
These are also key themes in our book
For exclusive content related to the upcoming book on Building the Agile Business, you can sign up here.
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