Disruptive innovation, is a term coined by Clayton Christensen. The term describes a process by which a product or service takes root initially in simple applications at the bottom of a market and then relentlessly moves up market, eventually displacing established competitors.
For example, take a look at what a company like Uber has done to the taxi service in San Francisco. They don't hire drivers like Yellow Cab. They don't own a fleet of cars. They built an application. An application that has been very disruptive to the taxi industry and is changing the landscape of ride-hailing services.
Thanks to Uber, San Francisco's largest yellow cab company is filing for bankruptcy. Yellow Cab Co-op President Pamela Martinez was quoted saying that some of the financial setbacks "are due to business challenges beyond our control and others are of our own making." Yellow Cab's drivers are flocking to Uber, an app-based enterprise, lured by the promise of more riders and better schedules.
Yellow Cab has been turned on its head by a disruptive innovation. Uber has disrupted the ride-hailing service industry with a lasting impact which is now moving across the county.
Why do I point this out? Because, you are either being disrupted or are the disrupter. Think about that for a second. Ask Yellow Cab how it feels to be disrupted in an industry they felt very secure in before an application took over.
Look at companies like Blockbuster. I bet you can tell me who disrupted them? Got it in your mind?
Blockbuster in its peak in 2004 consisted of nearly 60,000 employees and over 9,000 store locations. In 2000 a fledgling company came on the seen slowly changing the landscape of the movie rental industry and eventually bankrupting Blockbuster in 2010.
If you were thinking of Netflix then you are correct. Now a $28 billion dollar company, about ten times what Blockbuster was worth. Blockbuster has been greatly disrupted and is reinventing itself.
You can either be disrupted or be the disrupter as with VMware. They have been a disruptive force in the technology industry from their entry with vSphere to their latest creations like SDDC, vSAN and NSX. VMware's vSphere changed the landscape of compute forever, moving cpu, memory, etc. into software, removing the dependency on hardware and has now become the most popular infrastructure management API in use today.
Disruption doesn't happen overnight; Disruption happens gradually. Remember, the term "Disruptive Innovation," is taking root and relentlessly moving up the market. Uber didn't overtake Yellow Cab overnight just as with Blockbuster. A disruptor was introduced and slowly moved to overtake the industry.
The same is true for vSphere. Industry leaders were hesitant to adopt such a drastically different technology but now this tried, tested and proven technology is the leader in x86 server virtualization infrastructure.
VMware continues to be a disruptive force in the technology industry. Look at the movement to hyper-converged. Hyper-converged is about software, not hardware. Hyper-converged derive from being able to support all infrastructure in software, and without the need for separate dedicated hardware, such as a storage array or fibre channel switch. And, what is the core software technology in just about every hyper-converged product available today? VMware vSphere and the Software Defined Data Center.
VMware is disrupting the way that we have traditionally approached the data center. Fully virtualized infrastructure, delivered on a flexible mix of private and hybrid clouds. I'm sure you have all heard the mantra, "One Cloud, Any application, Any Device." This is the next evolution in data center technology and VMware continues to lead disruptive change with products like NSX for Software Defined Networking (SDN).
NSX like vSphere has had a slow adoption. I find myself having the same conversations with customers that I had when vSphere was introduced. You don't have to convince customers of the value of vSphere anymore. The speed of adoption is picking up and VMware saw an increase of threefold in the number of paying customers for its NSX network virtualization product and in Q4 of 2015 9 out of 10 VMware deals included NSX.
The NSX solution is an innovative approach to solving long-standing network provisioning bottlenecks within the data center, and it allows for the integration of switching, routing and upper-layer services into an integrated application and network orchestration platform. With an overlay solution that may not require hardware upgrades, NSX offers customers a potentially quicker way of taking advantage of SDN capabilities.
NSX is that disruptor in the networking industry bringing agility to existing network deployments with limited impact to existing network hardware and offering all of this without vendor lock-in. VMware NSX works across many IP-based network installations and in virtual environments running mainstream hypervisors and has established relationships with a broad set of IT vendor partners to provide integration of security and optimization solutions, as well as key network hardware players, such as Palo Alto, Arista Networks, Brocade, Dell, HP and Juniper Networks.
Remember back in the beginning of this blog where I quoted President Pamela Martinez as saying that some of the financial setbacks "are due to business challenges beyond our control and others are of our own making." Some challenges were of their own making. Remember too that disruptive innovation happens over a period of time. It took 10 years for Netflix to overtake Blockbuster. Could Blockbuster have moved quicker to insue their spot as the leader in the online movie rental industry? The same is true with VMware and vSphere. This disruptive innovation took time to take hold and now it is still a driving force to change the industry with SDDC.
VMware NSX is picking up steam and is in the heart of every hyper-converged to hybrid-cloud solution that companies are moving toward. The question is will you be disrupted or be part of the disruption? I want to be part of the disruption and drive change in an exciting time to be a part of this industry. Will you be disrupted or will you help disrupt? It's a call to action; To be the disruptive force that your company doesn't even know it needs because NSX will do for networking what vSphere did for compute.
Disrupt or be disrupted.