Just Good Enough

Disruptive Innovation's most important lesson is "Just Good Enough" for new and more customers is likely the source of a real existential business threat.
Counterintuitively, it's the good business leaders with good business strategies that are also the most likely to get disrupted. They end up pursuing the "continuous improvement" of their products and services, often with the input of their biggest and most important customers. They look at their products and services through the lens of their current customers, and they use the tools and processes of their current organization to improve them.
This strategy is often referred to as the "80/20 rule" or "good enough" strategy in technology ventures. It's based on the Pareto Principle, which suggests that 80% of outcomes often come from 20% of causes. In the context of tech startups, it means focusing on creating a product or service that satisfies the core needs of your target market, rather than striving for perfection or excessive features.

Why is "Good Enough" Strategy Effective?

  1. Faster Time-to-Market: A minimal viable product (MVP) allows companies to quickly enter the market and start gathering user feedback. This agility can be a significant advantage, especially in rapidly evolving industries where being first can mean capturing a larger market share.
  2. Lower Development Costs: Building a simpler product requires fewer resources (time, money, personnel), reducing the financial risk associated with launching a new venture.
  3. Focusing on Core Value Proposition: By focusing on what's essential, startups can ensure they're delivering the most critical features that solve their customers' pain points effectively. This clarity of purpose helps in maintaining customer satisfaction and retention.
  4. Iterative Improvement: The "good enough" strategy doesn't imply a lack of commitment to quality or improvement. Instead, it allows for continuous updates based on user feedback, gradually refining the product until it reaches its full potential.

Examples:

  1. Airbnb: In its early stages, Airbnb was criticized for the poor quality of some listings and the lack of professionalism in their photos. However, instead of waiting to perfect every detail, they focused on solving the immediate problem of finding affordable accommodation alternatives. They iteratively improved based on user feedback, eventually becoming a multi-billion dollar company.
  2. Dropbox: Initially, Dropbox was just a simple file-syncing tool with a compelling demo video (rather than a fully functional product). This "good enough" approach helped them secure significant funding and rapidly gain traction in the market. They then built out their service based on user demand.
  3. Slack: Slack started as a basic team communication tool, but its simplicity and focus on improving real-time collaboration within teams quickly resonated with users. Over time, they've added more features, yet the core of their product remains straightforward and easy to use.
  4. Instagram: Instagram's initial release was limited to photo filters and a simple feed. Despite this "minimal" feature set compared to competitors like Flickr or Picasa at the time, its ease of use and focus on social sharing rapidly gained popularity, leading to its acquisition by Facebook just two years later.
These examples illustrate how being 'good enough' - focusing on solving a core problem effectively rather than trying to be perfect from the start – can catalyze growth in technology ventures. It's about striking a balance: delivering value swiftly, gathering feedback, and continuously improving based on that input.