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Will toilet paper become obsolete?

Ideas on business model innovation


If you’re an executive and aren’t anxious about the rate of change in the business world, my guess is you’re just not paying attention. Either that or you sell toilet paper and aren’t worried about any new, disruptive technologies. Even a toilet paper company, however, could find its business model disrupted by a hungry startup — perhaps a tiny, self-contained manufacturing unit that recycles your lawn clippings and turns them into tissue.

No more trips to Costco.

I’ve written extensively about business strategy, but before you crack the code on why customers buy from you rather than your competition, you need to have a business model – identify a need and an operating model to profitably satisfy that need.

Business model disruption is different from strategy – as an example, ask – How can we make toilet paper softer?

Amazon and Harry’s shave club have business models that are disturbing to brick-and-mortar retail. Southwest Airlines revolutionized the airline industry with new standards. Dell was disruptive to personal computers. Netflix has a delivery system that’s transformed movie theaters and other entertainment. Blue Apron and its peers are potentially troublemakers to traditional grocery stores and dining establishments.

The language of strategy is inconsistent, and the line between model and strategy is blurry.

Deal with the ambiguity.

What’s important is that you consider both concepts.

Some startups are capitalized and operated without a strict business plan. A few figure it out and make oodles of dollars. Most go down in flames. I’m not a fan of investing in a business that doesn’t address an identified need or has no identified profit model.

This is what most interests me about the healthy, but somewhat paranoid, leaders of successful businesses:

What alternative business model might be disruptive?

Who will come at this need from an entirely different viewpoint and eat our lunch?

A strategy that identifies how you’ll compete in the present isn’t worth spit when someone changes the rules!

Don’t bring a knife to a gunfight.

Much innovation comes from startups, but it doesn’t have to be that way. Folgers could’ve developed Starbucks, and Walmart could’ve established Amazon.

If you’re in the health care, education or the transportation worlds, you could think about how to put patients through your clinics faster, provide more interesting classes, or offer new practices for hiring truck drivers — and you should!

However, it’d also be beneficial to think about patient care without clinics, education without professors and transportation without drivers.

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Todd Ordal

Todd Ordal is president of Applied Strategy®. Todd helps CEOs achieve better financial results, become more effective leaders and sleep easier at night. He is a former CEO and has led teams as large as 7,000. Todd is the author of Never Kick a Cow Chip On A Hot Day: Real Lessons for Real CEOs and Those Who Want To Be (Morgan James Publishing, 2016). Connect with Todd on LinkedIn, Twitter, call 303-527-0417 or email todd@toddordal.com.

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