Disruptive Innovation takes a product that’s historically been too expensive, complicated, and/or inconvenient for the majority of people to use, and transforms it into one that’s so simple and affordable that a great many can do so. And no company has mastered this more than Apple.
It’s been less than a month since the newest iPhones hit the shelves and fans lined up to get the latest and greatest from Apple. The iPhone is largely responsible for disrupting computing and later photography—let’s explore how it transformed the former industry, and what healthcare innovators can learn from it.
When Apple launched in 2007 it sought to make computing accessible to billions of people around the world who couldn’t afford computers. It wasn’t the only one; the i-mate JAM, BlackBerry, and Palm Pilot also aimed to democratize computing by making it simpler and more affordable. In many ways, they even shared similar features. So why was it the iPhone that successfully defined the smartphone, and ultimately spurred a wave of disruption?
In short, because disruption is not just about the product. It’s about (1) addressing a consumer need that makers of current solutions are ignoring, and (2) ensuring success by aligning the whole business model toward that end. While Apple’s competitors put computing into consumers pockets, the iPhone took it up a notch by making computing useful, with every aspect of its business model supporting that purpose.
Specifically, Apple created a new business model around applications that made their phones infinitely customizable and useful. On the consumer side it created the technology for users to download apps from the web onto their devices, it launched the App Store to make shopping for apps convenient and engaging, and it leveraged its brick-and-mortar stores to provide free user support for customers who needed help downloading and managing their apps.
On the supply side, Apple secured a community of developers to keep the App Store brimming with options, requiring a host of new assets, processes, and policies to ensure Apple’s relationship with developers would be productive and sustainable. It was the company’s business model—not its product design—that made the iPhone so customizable people can solve almost any problem anywhere in the world. Today, iPhone users can do everything from completing work assignments, to editing professional grade photos, and even being told by a pirate voice where they parked their car.
The lesson Disruption Theory teaches, therefore, is not how to design a product differently, but how to compete differently. It’s not just about technology solving an important need, but the business model enabling that need to be addressed as effectively as possible.
So, what can the iPhone’s continued disruptive success teach us about disrupting healthcare? There is an urgent market need that America’s incumbent, acute care-focused healthcare system isn’t designed to address: the need for care that helps each of us live the longest, healthiest life possible. When innovators design solutions to that end, and deploy them within an enabling business model, they’ll create the conditions for cracking expensive, painful problems like chronic disease. That’s how disruption can make healthcare better and more affordable.
Consider how healthcare professionals are using telemedicine to provide for patients who are harder to reach. Just as the iPhone and its competitors made computing more accessible, telemedicine has made care more accessible; yet its potential to be a disruptive force in healthcare hinges on how it’s used. If healthcare professionals deploy telemedicine in the same business model they’ve always used, then it won’t be disruptive. However, if it’s deployed in a new business model that aims to aid healthcare’s shift toward population health management—for instance by facilitating stronger relationships with people in their homes and community, and leveraging these to help people better manage their own health—then telemedicine could fulfill its disruptive potential. Disruption doesn’t just happen because the technology or product design is impressive.
Innovators proposing new healthcare solutions often label those solutions as “disruptive.” But for innovations to truly transform the industry by making care more accessible and affordable, they can’t be deployed in the same business models. Those who focus on how their technologies are used will find more disruptive success —and could one day be known as the Apple of healthcare.
