This document discusses how organizations can leverage capabilities in disruptive environments. It defines key terms like leverage, disruption, and capabilities. It describes how organizational capabilities focus on meeting customer needs and creating competitive advantages. Traditional sources of advantage are lower costs, product differentiation, and innovative technology. Capabilities provide customer value through responsiveness, relationships, and service quality. Disruptions can be technological or marketing innovations that create new markets and overtake existing ones. For organizations, disruptions can present threats or opportunities depending on factors like adaptability and innovation. Examples of disruptive strategies include low-cost airlines and new financial products. The document provides tips for leveraging disruption, such as learning from the market and identifying new opportunities.

1. Leveraging Capabilities
in a disruptive
environment
Dr. Sandeep Kulshrestha

2. Some key words used in this presentation
 Leverage: Gaining benefit
 Disruption: Separation/Division into parts (Ref:
Dictionary.com)
 Capabilities: A firm’s ability to gain competitive
advantage
 Competencies: Specific skills and experience in
the market where the firm is operating. Eg:
Delivery of Pizzas by Dominoes

3. Organizational Capability
 focuses on internal processes and systems for
meeting customer needs
 creates organization-specific competencies that
provide competitive advantage since they are
unique
 ensures that employee skills and efforts are
directed toward achieving organizational goals
and strategies

4. Traditional Sources of Competitive
Advantage
 Economic / financial capability: able to produce
good or service at lower cost than competitors
 Strategic / marketing capability: products or
goods that differentiate a firm from its
competitors, typically by “adding-value” or
“product-portfolio mix.”
 Technological capability: products or services
that customers receive are innovative, high-
quality, state-of-the art, typically in how they are
built or delivered.

5. Organizational Capability and value for customers
 1) Responsiveness: the ability of the business
to understand and meet customer needs more
quickly than competitors
 2) Relationships: the ability of a business to
develop enduring relationship between customer
and employee
 3) Service quality: the ability of business to
design, develop and deliver service that meets or
exceeds customer expectations.

6. Disruption in the strategic process
 An innovation/practice that creates a new market
by applying a different strategy, which ultimately
overtakes an existing market.
 It can be technological as well as marketing
linked

7. What Disruptions do
 Disruptions in the business environment cause
economic shifts that destabilize industries,
companies, and even countries
(Harvard Business Review)

8. Disruption…..
Opportunity
or Threat

9. Disruption as a threat
 For firms who don’t change their strategies to
cope up with disruption, it is a threat

10. Disruption as an Opportunity/Leverage
For firms which are;
 Adaptable
 Flexible
 Risk taking
 Innovation oriented
 Employee friendly
 Resourceful
 Technology Friendly

11. Examples of disruptive strategies
 Air Deccan started a Airfare of Rs 1 + Tax in the
year 2005, creating disruption in the civil aviation
sector
 Citibank was the first bank in India to offer credit
cards in early eighties
 Maruti 800 changed the shape of the market.
Premier Padmini was out of market within no
time.

12. Disruptive Changes
 Technology
 Business Strategy
 Industry Dynamics
 Globalisation
 Outsourcing
 Political and Regulatory Environment

13. How to leverage from a disruptive environment
 Learning from the market
 Expanding horizons
 Identifying the probable disruptions
 Selecting new ideas
 Turning new ideas into opportunities
 Reducing risk by entering into related industry
 Technological as well as marketing
collaborations