These new business models have been feasible because of technological innovation. However, a very core element common to major sector disruptions today is increasing public engagement and empowerment. New disruptive systems are enabling the customer to also be the producer or rather, the ‘prosumer’.
Arnstein’s ladder of citizen power proposed in 1969, identifies evolving rungs of citizen participation; starting at manipulation, it rises to citizen control. The examples mentioned earlier of disruptive businesses have been helping citizens move up this ladder. In doing so, they are redefining business in areas such as transit, travel & entertainment respectively by enabling the consumers to create value and share it with other users.
The power sector increasingly faces fears of disruption; a change in its traditional way of doing things. Primarily led by technological innovation in renewable energy, the power sector is getting disrupted as people are starting to produce energy and not just be end of the line consumers relying on a centralized grid. The incumbents in the sector, used to top-down decision-making, are finding it hard to adapt, leading to fears of the utility death spiral.
So as consumers become prosumers, what role can businesses play? In the power sector, it is being predicted that with rising decentralization, utilities will become managers of unique platforms that allow two-way transfer of data and electricity. Thus, transforming into new roles, creating and capturing value through empowerment, helping society move up the empowerment ladder.
However, all disruption is not good, and seemingly great new systems can have unintended consequences, e.g. Uber and workers’ rights in a gig-based economy; Airbnb and issues of discrimination from users etc.
The salient question then becomes: Is disruption equitable, are all people being equally affected? Is disruption leading to the disenfranchisement of the bottom of the pyramid, or is it being driven to support them? Often, the negative consequences of good disruption can be attributed to a failure of the system. A systems change perspective is then required to support disruption and create positive value for stakeholders and society at large.
Disruption is monumental, hard to predict; we don’t know what can happen in the future, and more importantly we often don’t know what we don’t know. As Zygmunt Bauman puts it “We are in a period of interregnum, between a time when we had certainties and another when the old ways of doing things no longer work. We don’t know what is going to replace this. We are experimenting with new ways of doing things.” (Source)