Market disruptors

Game Changers by JJ Atencio

This column will explore and talk about success, the kind that comes from game-changing innovation that makes the business a market disruptor.

In the just concluded Philippine Investment Summit hosted by the Financial Times and First Metro, where I was a panelist in the discussion of “market disruptors,” the thesis was that, before the private sector would be instrumental in enabling the Philippines to compete in the international playing field, firms must be prepared to embrace major market disruptors, from regional demographic changes and evolving consumer trends across Southeast Asia, to global and industry-wide trends in e-commerce, social media, data and other digital developments.

Even as businesses prepare to embrace and respond to market disruptors, we must also prepare to evolve our businesses to become market disruptors themselves. Market disruptors provide us opportunities for innovation, which results in not only redefining our enterprise, but also changes the game for the industry we are involved in.

In the mass housing sector, for example, the drastic and abrupt change in housing finance by the Home Development Mutual Fund, or Pag-IBIG, in 2011 provided us an opportunity to innovate and become a market disruptor in an otherwise conservative, cautious and rather unimaginative industry. 2011 gave us a chance to innovate housing production by reengineering our precast construction technology to produce solid and quality houses in a matter of eight days.

We innovated housing finance by coming out with an in-house financing scheme that was based on the realities of how the mass housing market earned their money and how they budgeted and spent it.

We innovated our business model by insisting that our credit and collection policies focus not so much on collection but on buyer’s education and behaviour modification. The results were dramatic: while the industry was forced to contract due to tighter home lending rules, we were growing by 33 percent annually, capturing a bigger market share each year.

I realize that success—the spectacular and long lasting kind—is not about just playing the game well, but about introducing change, creativity and out-of-the-box thinking that revolutionizes in such a way that changes the game itself. Its about innovation. It’s about challenging preconceived notions about one’s business and, by designing new ways of doings things based on insights gained by closely studying your target market, one can change the game, disrupt the market and emerge as the industry leader.