How to convert problems into disruptive innovation?

Omar Javaid
Nov 27 · 22 min read
Image Source: https://www.bill.com/blog/disruption-more-buzzword/

I have been observing aspiring-entrepreneurs since last 9 years or so. I have attended business plan competitions, startup exhibitions, followed many new entrepreneurs online, let alone teaching entrepreneurship to undergrads or post grade students myself for nearly a decade. What I have noticed that 99% of the ideas which the aspiring ones bring are either run-of-the-mill, a copy of an existing idea or they try to target a superficial problem with a hypothetical solution at best. In other words, I have found most of them not working on current or emerging big problems of our society (as they say, the bigger the problem, the bigger the opportunity). And the rare examples, who do try to focus on issues like garbage collection, health care, or unemployment etc., do not seems to possess sufficient in-depth understanding of the root of a particular problem. There is also appears to be an over-reliance, or rather a blind-unwarranted belief on IT based tech to create solutions for problems which are at best superficial. As a result, the ideas which they bring in are not disruptive in least of its sense.

I don’t intend to blame the aspiring-entrepreneurs or practicing entrepreneurs for this lack of depth or focus on big problem (big opportunities) spread all around us. It is the job of the teachers and mentors to guide them out of their bubble, help them see the problems, understand their roots, and show them how to work out a possible solution for the root cause or short term remedy of its effects. Possible externalities of a certain solution also need to be worked out so as to be at least aware of the hidden costs on the environment, society and economy. As a matter of fact, most teachers and mentors are themselves not aware, or too much fixated on mimicking the solutions created by successful entrepreneurs in foreign sociocultural contexts, or on the very least, only concerned about maximizing ROIs. Result is ignoring the obvious. Problems like climate crisis, rising traffic congestion, pollution, water scarcity, food security, unaffordable health care, poverty, unemployment, inflation, street crime, corruption, garbage, trade deficit, absence of proper education system etc. etc. are ignored typically as if they do not even exist (there are a few exceptions though). To cure such pressing problems we need urgent solutions to effectively disrupt the old structures acting as the breeding grounds for the problems. This article therefore attempts to outline a methodology to workout disruptive ideas or solutions for the pressing problems around us.

Disruption and its drivers

Allow me to first explain what a disruptive idea is. An idea is disruptive when it has the potential to transform how we do things to an extent that the existence of a particular problem becomes impossible. Disruptive idea therefore do not solve a particular problem, rather it altogether eliminates the possibility of the existence of a problem. It’s can be referred to as the Sun Tzu (the ancient Chinese author of the famous book ‘Art of War’) way of solving a particular problem. If an idea has the capacity to do so, it should be referred to as disruptive. I define the term ‘disruptive’ in a way different from Clayton M. Christensen’s definition of the term ‘disruptive technologies’. Christensen’s definition use the language of business and economics which I would like to avoid primarily because I do not wish to evaluate a disruptive idea for its capacity to generate economic value rather for its capacity to solve a certain problem.

Reasons for avoiding economic valuation of an idea are philosophical, psychological and neurological. Every problem adds to the pain, losses, damages or wastage in a man-made or natural system. Often the impact is more subjective than objective, and is difficult to quantify. If the elimination of the problem leads to benefits greater than direct — indirect cost of disruption, then disruption will be justified. The benefits are often subjective and nearly impossible to quantify, therefore true impact of disruption or the problem it intends to eliminate would be eluded if quantitative techniques of modern economics are used for that purpose. That’s the philosophical argument to avoid economic evaluation.

The 2nd reason is psychological. Carl Jung and Victor Frankl, two famous names in the domain of existential psychology, would testify that our creative process works best when we pursue a meaningful goal with all its subjective and extra-rational justifications which emerges from the subconscious of our minds. Modern scientific method employed by modern discourse of business and economics only focus on what our rational or conscious mind can express or justify in pure mathematical form. Therefore, employing the scientific techniques of modern business theory and economics would not allow a full utilization of our mental faculties like intuition, ability to think holistically and the energy from our subconscious mind.

Finally, from a neurological perspective, our creative process happen in the outer layers of our brain, while involving financial stakes in the equation can trigger the primitive parts of our brain responsible to generate the fight and flight response. When it comes to financial rewards, the fear of losing money is a far greater driving force than the anticipated pleasure of a monetary gain. Therefore, when the goal of finding a disruptive idea is rather to seek ROI, the parts of our brain which are responsible for the creative process become less empowered in comparison, while our limbic brain system, amygdala in particular takes charge subsequently reducing our creative capacity. For these philosophical, psychological and neurological reasons, it’s better to avoid using the paradigm and language of business and economics, while discussing how and why of disruptive idea.

It has been long known that great innovators of all time were not primarily driven by material gains. The urge to contribute towards the society or the sheer joy of inventing a solution or a problem was their primary driving forces. Jim Collins would also concur (see his book ‘Built to Last). Motivational theories like that developed by Frederick Herzberg suggest the same. True happiness indeed comes from investing in others, to make the world a better place and not just in exclusively pursuing our self-interest. That’s what Victor Frankl meant by bringing ‘meaningfulness’ into our lives, which Frankl considered even more important than pursuit of happiness alone, happiness is mere a byproduct rather. The point is not to completely ignore the economic sustainability, but to avoid it as a primary motivation behind a disruptive idea due to its distracting influence. Keep in mind that the world needs more healers then billionaires now. This realization in itself is as disruptive as it can get. Let us have faith that an idea of makes the existence of a problem redundant will eventually find enough support to grow and transform into an economically sustainable enterprise.

Some problem busting rules

So the rule number one is when we ought to find a way to eliminate a problem, we will not constraint our minds with the worries of generating ROI … let the Divine powers take care of that for a moment (you must be having some faith in some Higher Power, don’t you, who would support you if you try to make the world a better place). Our intention should be to make the world a better place even if it requires eliminating something. Elimination often require re-engineering of a process or replacing it altogether in a way that the root of the problem seizes to exist. That’s often counter intuitive for many people who are in search of a product or a service to be sold to a certain target audience with the conventional idea of selling something to make money. This conventional idea is limiting in itself as we are not trying to create a product or a service, rather a solution to a problem which may be sustained in a variety of creative ways. So the rule number two is to consider option of elimination open, even preferable if it makes a problem disappear altogether. Nassim Nicholas Talib refers this approach to as ‘Via Negativa’.

Rule number three: Keep away from institutional investors at least in the beginning. The primary concern of an institutional investor to seek guarantee for ROI from the entrepreneur. The quicker and greater the return the more the institutional investor is willing to invest. Often VCs are looking for a 10 times return on their investment. So when an entrepreneur looks forward to a VC or an institutional investor then the pressure forces him to only pick up propositions which can look attractive to the investor in terms of ROI. Chamath Palihapitiya, a former FB employee, entrepreneur and VC, also acknowledges that ideas built around world’s big problems may reach breakeven in at least 7 years, with an annual return of not more than 20 percent. Not every investor is like him. The other problem with institutional investments particularly VCs is that they are extremely rare, like for example in USA only 600 ventures were financed in 2016 (if I remember the year correctly) whereas the total number of new ventures launched were more than 600,000, most of which were financed by personal savings, or from the angle investors among family and friends.

This brings us to rule number four: Simple is better than complex, because it is cost effective, easier to maintain and fix. Often the problem exists due to unnecessary complications of a system, and the solution lies in simplification. One may ask then why complex systems are then created. There can be many reasons. For example, we are typically biased toward complex systems and often consider them to be better, the Medical Industrial Complex is a good example. Often experts in a system prefer complicating it so as to avoid criticism or competition, as complex systems are often impossible to copy but impossible to fix either in case a problem arise, so to fix a problem, something always requires adding as it is often impossible to identify what exactly is causing the problem due to extreme interactivity of components with each other. So to fix a problem, adding something to the system is preferred, which also adds to its complexity. Giant tech companies like Google and Amazon are following this pattern according to Jaron Lanier, where not a single expert can explain how the entire system works, and to fix problems experts keep adding stuff. Complexity therefore breads complexity, and also renders a system incapable of radical change if needed.

Rule number five: Roots of the problem often lie in maps or templates upon which systems are built, or the very logic behind the maps, or the very paradigm at the root of the logic, or the very axioms at the root of the paradigm. The deeper the root goes the more radical and ideological the solution is. That is why one can argue, that the greatest disruptions of all time have been the ideological disruptions, but they also take considerable amount of time to spread, and the instigators also face massive resistance from the status quo. If your concern is that you are not specialized or trained to dig so deep, then please remove this concern from your mind. If you are here to eliminate a problem, and want to remain inside your comfort zone and domain of specialization then please let go of this mindset. Therefore, there need not be any self-imposed intellectual limits to constraint the development of a disruptive idea. Solutions to problems emerge via integrating horizontally across subjects, and vertically along the layers of knowledge (from processes, to maps, to logic, to paradigm to axioms). Your mind must be free to move in any direction it takes to develop an alternative map, logic, paradigm or axiom to disrupt.

Rule number six: Old can be gold, or even better. Cancer for example is an outgrowth, removing it from a system is disruptive for the cancer at least. But after its removal we restore the system to its default position. Often ancient ideas brings us wisdom pertaining to all layers of knowledge, so to find an alternative, all what we need to is to look or compare the existing with the old. These could be religious ideas, or ideas of ancient philosophers. For example, Socrates, Plato or Aristotle (for example) are still used while working around many modern problems. So let us scrap the claim that if it is modern so it would be better by default, in fact it could be worse. Restoration to the original setting can be massively disruptive keeping in view the complexity of the outgrowth which require removal; let us not adhere to it just because it is modern. Keep the options open.

Rule number seven: Benefits are often subjective and not quantifiable, and the very attempt to quantify the benefits is an act of ignoring the wide array of benefits which are not quantifiable. Same is true for the losses or damages. The damage to the social relations is often unquantifiable, so is the damage to the natural environment. The obsession to quantify therefore often makes it difficult rather impossible to value the subjective side of a certain initiative or project. Subjective benefits or damages are often more significant or worthy of consideration then objective or quantifiable ones. For example, we might not be able to properly assess the damage to the environment due to pollution, or human relations with the spread of materialism. Children do not understand the monetary value of the toys or cloths being given to them, rather they do feel the importance of being valued in the act of receiving a gift from a loved one. Is it possible or even appropriate to assign a quantitative value to the emotional benefit a child receives in the process of being valued?

Rule number eight: Do not become a direct rival of the existing players in the industry, do not enter into the red ocean. Because if you try to directly compete them they will obviously create problems for you. You become a direct rival, but bringing in a direct substitute of their product or service. It is possible that you might want to partner with one of the big players to compete with others, however, the chances of getting beaten in a game are very high which you are not expert playing while your competitors have decades of experience, and they know all the tricks in the game. Besides getting into a direct rivalry implies that you at least agree with the rules of the game. What if the problem is not in the product or service, but in the very rules of the game, or in the very logic on which the system is built upon. So the very act of direct competition implies that you perhaps have not understood the root of the problem correctly. I do not know of a single big problem in the world at the moment which can be fixed by bringing in just a better product or service. The problems have deep roots, and often the rules of the game which all competitors equally follow are responsible for the externalities a particular market segment generates. Take greenhouse emissions as a case, or plastic pollution, or the side effects of social media, or problem of flight of capital from different economies during the time of recessions etc. All of these problems are not created by a particular type of product or service, rather by the rules on which the systems are built. So the act of getting in direct competition will not just make your survival, let alone growth, difficult, but will also make you play by the same rules which are responsible for creating the problem in the first place. Disruptions as we discussed happen when we change the rules of the game rather.

So here is a summary of rules described above:

1. Do not worry about ROI when working on a innovative solution or finding a problem to work on, we will rather worry about financial sustainability while formulating the execution plan later, but first target needs to be set and that’s not ROI, if it is, its is highly unlikely that the idea would be genuinely disruptive;

2. Do not approach an institutional investor, at least in the beginning

3. Solution can also be in eliminating something from the system (Via Negativa);

4. Simple is better, complex isn’t;

5. Do not limit yourself to a single specialization, peel off layers of the system to find the roots;

6. Old can be gold;

7. Benefits or losses are often unquantifiable, try not to quantify them …

8. Do not try to compete with the big players directly …

Steps to workout Disruptive Solutions

So in the first step, you need to know the big problems that are disturbing or will disturb a significant number of people on the planet or in the country. For that you need to be well read, and aware of what is happening around, what the experts are talking about. It is true that it require a considerable amount of research to just to make a list of major problems in the order of severity, and even greater amount of research to understand their actual root cause. It is also quite understandable that you might want to limit yourself to a particular domain, but keep that in mind, that problems are complex, and their roots cut across various disciplines. So even if you pick a particular problem based on your area of specializations, you might have to explore various domains to trace the roots and how it may be solved to the core. Take the problem of non-communicable diseases like cancer, diabetes, cardiovascular issues etc.; anthropologists have found many primitive communities untouched by modern lifestyle, which are almost free from such diseases. Jared Diamond has documented his firsthand account of emergence of such diseases in Papua New Guinea. Diamond explained that when he began to visit the place some 40 years back, non-communicable diseases were almost non-existence, but as the country gradually modernized and people adopted processed food and other synthetic products, the occurrence of such diseases also increased, and as of now a significant number of the population suffer from obesity, diabetes, cancer and cardio issues etc. Papua New Guinea is not the only place on earth where one can observe such a phenomenon. This implies that if one really wants to save people from cancer for example then one must understand what chemical substances leads to cancer, why they were non-existent previously, and how such contamination can be eliminated from our lives. Prevention is the best cure, but to do that in case of non-communicable diseases your knowledge of human physiology alone is not sufficient.

Another pre-requisite is passion. Look inside, does a problem disturb you greatly, and thought of working for its solution sparks some energy inside you? This intrinsic motivation is extremely important to maintain your natural drive particularly during the rainy days. But you must further ask, why you really want to solve it, and what would it really take, are you willing to pay the price of getting out of your comfort zone? Does the result or the act of working on the problem motivate you? Often striving to solve a problem can take you toward life threatening situations, so you must also ask, are you willing to take the risk? If the answer is yes, then it means that the outer layers of your brain are active enough to overcome the fears lurking beneath, inside your amygdala. Your prefrontal cortex (the front part of your brain) must be empowered enough, and that can only happen if you really feel the worth of taking the risk, and visualize your role in the bigger picture. Since it’s all subjective with a strong input from intuition, therefore, one must not try to rationalize the cost-benefit analysis in the light of available empirical evidence. Let your intuition lead your way.

In the second step, after identifying a problem, and passion, it’s important to dig deep into the root cause. The example of communicable diseases shared above already hints toward the process of tracing the root cause of a problem. Here is more on it. The most important aspect of the process is to distinguish the symptom from the problem, and trace its root-cause. Only by such differentiation we would be able to correctly define the problem with all its depth and breadth. Take plastic pollution for example. At the moment the plastic manufacturers are putting in some 300–400 million tons every year, half of which is single use plastic. There is so much plastic thrown in the world now that rain contains plastic particles, plastic is found on ice in the arctic, every fish and marine animal is ingesting plastic which often chock them to death, plastic as of now has become part of our food chain, and it is already proving to be hazardous for all kind of life including humans. So what should we do? The first question to ask is, why the world is so hooked to plastic? To answer this question one has to understand why a disposable culture exists, how our production system is organized, and what keeps the general public from knowing the harmful effects or deliberately remain in the state of denial? At every stage, you need to ask ‘Why this happens’. That will eventually lead you to understand the actual cause of a problem, and subsequently find a solution. For example, the public’s perception about the culture disposability needs to change; in many cities around the world, shops are opening up which expects the customers to bring their own jars and bottles for refilling their daily use items. Instead of selling water bottles, there can be water dispensers which would refill the bottle which you would carry with you. The distance between the producer and consumer needs to be reduced so much so that the need of packaging material is eliminate. But this doesn’t happen because the economy has gone extreme on the idea of division of labor and globalization, where each person is expected to specialize and spend all his time in just a single narrow domain. In traditional homes for example, this isn’t the case, as people there know how to produce many of the stuff all by themselves. In tribal societies on the other extreme they in fact produce everything all by themselves.

So perhaps to fix the culture of disposability and extreme division of labor, we might want to shift a little backwards to progress toward a more cleaner and healthier future by learning to do more stuff by ourselves, and finding time to do the same. This will require a cultural shift, in fact in a country like Pakistan; we rather need to put some breaks on the cultural shift from traditional to modern for that matter, and reassess what we are adopting and how it would impact. The impact of disposable culture as a matter of fact is already visible, yet we are not too far away from what we have left behind. Entrepreneurs who are concerned about plastic pollution, may want to re-brand and promote a non-disposable lifestyle where reuse and recycling are the norms. Contrarily if as an entrepreneur or inventor you are trying to find alternative materials for plastics, well that’s noble! More power to you, but please ask, why plastic has become so common in the first place! And that will take you places, where it will be possible to eliminate the problem altogether from existence. Talk about packaging free non-disposable lifestyle, instead. Removing one packaging material with another which we claim to be biodegradable, may not be the ultimate solution, let alone the disruptive one. Imagine, is it possible to produce alternative biodegradable materials in 100 million ton per year, and even if its possible, what will be environmental effects of 100 million ton of some new type of material on the planet, will its excess be beneficial for the ecosystem, will production be environmentally sustainable? And most importantly a trillion dollar industry will just allow any competitor to make them obsolete? Please see rule number eight above again.

Digging deeper also enable us to see the connection between multiple problems. Like in case of plastics, when we analyze the system of production spread across long distances, we also begin to connect other problems with it. Transportation to long distances also creates green house gases, which are responsible for climate crisis. Which is in fact a bigger problem in the making in comparison to plastic pollution, but it is connected in two ways with plastic production also. 1) The industrial system, which is dependent on a global transportation system to move raw materials and finished products, requires cheap, light weight and robust materials for packaging (plastic!), and 2) The raw material for plastics is fossil fuels, without which the transportation is not possible either at the moment. So fossil fuel is not just causing climate crisis, but also has given the modern man a means to wrap the products. But this begs the question why do we need to transport stuff to such a long distances? Why it’s not possible to develop all the stuff we need, at least the stuff we need for survival within a few kilometers radius? Is it not technologically possible to dedicate a few floors in every residential building for the production of food for example, so that the residents do not have to source it from long distances? When we are miniaturizing much of the computer hardware, why we do not try to miniaturize cloth production as well? Why not we use industrial hemp which can be grown virtually anywhere with a fraction of water, and use its fiber to make cloth in our mini factories spread all over the city? In many homes, we have machines to extract water from the air which can be used for irrigation or drinking etc., but we just throw the water down the drain, rather use the machines to cool the air inside our homes and offices (commonly known as Air Conditioners), why not redesign the machine to produce water though solar energy (this is already happening by the way)? Is it possible to generate energy through wind and solar for this miniaturized system of production or life support system? I cannot digest the fact that we do not have enough technological knowledge or resources to do so? In fact, part of what I just shared is already being attempted in many parts of the world. Self-sustainable communities and infrastructure is already in the making, all what is needed to take it to the next level where all the water, food, clothing, medicine, are produced within the vicinity of the community, and the surplus is given free to others.

So in the above example, the disruptive solution to environmental and oceanic pollution is not in inventing electric cars or in biodegradable plastic, but in reinventing the production system. But here is a deeper level to the problem. The global system of production for designed to maximize profits. The very idea to access global markets even directed the advancement of technology for the sake of globalization process, so we do not see advancements on the idea of self-sustainability on a micro scale. We can import stuff from anywhere on the planet, and sell likewise, so why try to produce stuff close to where we live, why not enjoy a wider variety of products when we can? The planet unfortunately cannot afford that luxury anymore and if the planet becomes more and more inhabitable then it will eventually lead to our own extinction as well. Is this is the price we want to pay for our petty pleasures? Global inequality and exploitation of improvised nation is another externality of the process. So the very ideology which fueled the exploitation of the planet for the sake of profits, need to be disrupted by the ideology of sustainability and localization. So the disruption in the production system often has to be grounded in a disruption in the ideological landscape for that matter.

Step three is choosing the right target audience; the audience which has been affected by a certain problem, or at best understand the root cause, and is willing to pay a price for a solution. The higher the level of awareness and motivation toward solution, the better it would be, if not then education eventually becomes a natural part of deploying a solution in step three. For example, if they want to get rid of plastic, they can be educated about how it is possible to bring necessary changes in their lifestyle, if they are not aware for example with the related problems, then obviously the process of their education and conversion toward a plastic free lifestyle would take much more time and resources. An important approach which can be taken to educate the public is to PERSONALIZE THE PROBLEM for them which you as an entrepreneur is trying to fix.

In this context, approach used by Marie Kondo, is a good example. Instead of talking about how hyper-consumerism is damaging for the environment, Kondo focuses on something very personal: Bringing Joy in our lives by improving relationships by removing the unnecessary material stuff which often become a bone of contention among family members (see her Netflix series Tiding Up). Also a disordered, messy home, full of unnecessary stuff, cannot give you the peace of mind and can keep you distracted from important stuff like relationships. So her movement to de-clutter the homes, and letting go the unnecessary stuff and keep only the stuff which brings joy also acts as a counter movement against consumerism which is also responsible for creating massive amounts of pollution in our lives. Educational content focusing on a point which people can value, therefore, can in itself become means to create disruption for good. For that we must have comprehensive knowledge about how a certain problem effect the public on a personal level. Besides modern advertisement do this all the time.

Here is another example, traffic congestion leads to waste of billions of rupees of fuel every year in Pakistan, which subsequently adds to the environmental pollution. So raising awareness about environmental pollution and how bad it is may not much help the people who do not have any other alternative. However, a training program which effectively teaches the corporate world to allow their employees to work from their homes, with the focus of minimizing cost and improving productivity. Such a switch over is perhaps difficult until effective systems are in place which enables employees to work from their homes using digital connectivity; many white-color jobs can be transformed in this manner. Employees can be hired on a 10–20% lesser salary for example, the stress due to commuting can be eliminated, flexi-hours can enable employees to improve their work-life balance, and save many hours of commuting. A happy employee is a productive employee. As a result people will also burn less fuel and subsequently will reduce environmental pollution as well. Along with education or consultancy services, necessary IT solutions are also provided to the corporate clients for that matter. So to fight against climate change, instead of bringing in electric cars and competing directly with the conventional auto manufacturers, we can use tech to avoid commuting altogether. So to reduce greenhouse gas emissions, we avoided direct competition with the automotive industry, opt to eliminate the root-cause of the problem, focused on simplicity, and going back to the tradition of working from home. Communication technology however is was an addition.

A lot more can be added here, but the basic steps which can lead to the development of a disruptive idea has been explained above. Here is a summary

1. Awareness about problems as per the degree of intensity

2. Awareness about their root cause which may spread across various disciplines. The knowledge of multiple disciplines is therefore necessary.

3. Understanding how deep the root goes, ask: does the root exists in the logic on which the system is built, or the paradigm on which the logic is based on, or the very axioms on which the paradigm is built.

4. The level on which the root is grounded is where the disruptive solution to the problem exists, changing the structure of the level like the logic on which the system is built will lead to the development of a disruptive solution. The idea of circular economy and miniaturization or re-localization of production system are good examples.

5. The deeper the root goes, the more education of the public will be required.

6. The need of education which focus on a personal economic or emotional benefit of the target audience can in-itself become a value proposition

7. Follow the rules described in previous section to work out a disruptive solution. Particularly the rule about simplification, which is in fact the key to the solutions of many modern problems. And simple solutions often do not require heavy investments.

In case you have any question, feel free to DM me.

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