Disruption is Dead; Long Live Disruption

We’ve all heard this phrase: The king is dead; long live the king! This is the once customary announcement proclaimed on the death of a monarch immediately succeeded by the designated heir. Crisis over. There’s a new king in town.

And so it is in the evolution of B2B value chains and marketplaces. Disruption as we know it is over, and a new form of disruption is ascendent. Change is constant, and disruption is normal.

This tale of change is heralded in an excellent new article on TechCrunch, “The next wave of supply-chain innovation will be driven by startups that help incumbents win.” The first wave of disruptors charged at incumbents, armed with digital technologies, seeking the holy grail of defeating and displacing them.

The new wave of disruption naturally flows from the first, catalyzed by its shortcomings, aiming to push farther by enabling and empowering established businesses. Collaboration is hot; conflict is not.

But there’s a problem. Incumbent leaders tell me digital startups are upstarts — full of passion and arrogance but lacking in industry savvy and experience. B2B is so complicated that it is impossible to explain to tech wizards born of “anything is possible” mindsets. Or so it seems. That’s if incumbents are aware of digital startups at all. Or if startups deign to slow down and listen.

All of these perspectives, held by incumbents and startups, are wrong. Opportunity is knocking, but mindsets, misunderstandings, and misaligned incentives are blocking progress. As a channel strategist with decades of experience, I see the promise of collaborations as a way to accelerate the inevitable and unescapable evolution of distribution and supplier/channel partnerships. As spring follows winter, a new value chain will emerge from the last. I’ve written so here, suggesting ten questions for fostering a productive dialog between startups and established businesses.

I’ve made progress. B2B startups and incumbents will never fully understand each other. The best partnerships are always marriages of the willing in search of something mysterious — a big idea beyond the reach of either partner alone but achievable through mutual commitment and shared effort.

In pedestrian terms, these mysterious outcomes are called “use cases.” In more passionate expressions, they are thought of as possibilities, visions, or, if you like, a raison d’etre — the existential purpose that defines one’s reason to be.

I’ve identified five bold, transformative ideas for the future and introduced them in Discoveries: Big ideas for radically reshaping distribution. I am writing about each idea in depth in Quick Take editions in my newsletter, Mark Dancer on Innovating B2B. Here, in this place, I share the two most relevant ideas, each with a very brief description of a collaboration that might make the impossible possible:

Decentralized distribution (DeDi). Decentralized finance (DeFi) is banking without banks. DeDi is distribution defined not by its warehouses and salespeople. DeDi is an anyway, anywhere, anytime platform for the digital age, combining real-world and virtual experiences. More here.

Regenerative distribution. Way back when before the internet, distributors existed to meet local needs with local inventory and local people. The first wave of disruption has thoroughly made irrelevant that definition of local. The second wave is not about serving local demand but rather serving local communities. More here.

I have been invited to join this newsletter as a contributing editor, and I am happy to lean in. I aim to help advance conversations and collaborations between B2B startups and established B2B companies. Together, much can be done. The impossible is possible. Change is inevitable, and I look forward to pushing progress along as B2B innovation, the future of distribution, and a radically new value system for the digital age.