[Kim Heeyoon's Bookshelf] The Secrets of the Disruptors Who Turned the Tables

Ministry of Defense DDS Hires Hackers to Find Network Vulnerabilities Despite Risk of National Security Leaks
Introducing Cases of Disrupting Existing Markets and Creating New Orders Through Innovative Ideas

The emergence of singer Yang Joon-il from 30 years ago, who swept the broadcasting industry last year, EBS trainee penguin Pengsoo, and rookie trot singer Yusansul is regarded as a fresh example of disruptors who have reorganized the market beyond innovation. Image = Designer Lee Jin-kyung

[Asia Economy Reporter Kim Heeyoon] Last year, the broadcasting industry was dominated by disruption beyond innovation. Singer Yang Joon-il, who was active 30 years ago, made a dazzling comeback riding the wave of retro video resurgence. Pengsoo, a ten-year-old penguin claiming to be from Antarctica, became a daily hot topic, roaming beyond EBS to other broadcasters. Then, Yoo Jae-seok, a national MC with 30 years of experience, transformed into rookie trot singer Yoo San-seul and won the Rookie Award at the Broadcasting Entertainment Awards. The broadcasting trend is also flowing smoothly into retro and original character (bonkae) and alternate character (bukae) content.

What secret lies behind the success of disruption that overturned the stale broadcasting scene? British management expert David Rowan pursued disruptors who created ‘real innovation.’ As a result, cases of disruptors who thoroughly destroyed and divided existing markets were compiled in his new book, Disruptor: Market Disruptors.

The U.S. Department of Defense’s special unit, the Defense Digital Service (DDS), hired professional hackers in 2016 to launch a government network hacking project. This project was inspired by the bug bounty programs implemented by private companies, which reward reporting security vulnerabilities. Despite the risk of national secrets being leaked, DDS succeeded in finding vulnerabilities in government networks. The U.S. Department of Defense spent only $150,000 (about 180 million KRW) on this project, but the potential damage prevented amounted to $1 million.

The case of Estonia, which eliminated borders at the government level, is even more interesting. After applying online and paying just 100 euros (about 129,000 KRW), one can obtain Estonia’s e-residency. Although e-residency does not guarantee a passport, entry, or residency rights, it allows for entrepreneurship and economic activities. Establishing a company and opening a bank account can be done in a day. Estonia introduced e-government services early on, enabling online processing of all administrative tasks except marriage, divorce, and real estate transactions. Notably, the world’s first internet election was introduced in 2005, increasing voter turnout and serving as a catalyst for the European Union (EU) to switch to online voting. According to global consulting firm Deloitte, by October 2018, 45,000 people had obtained Estonian e-residency, and Estonia is expected to collect 1.8 billion euros by 2025 through fees and economic stimulus effects.

Since last year, controversy has continued over the reform of domestic airline mileage systems. Amid this, Australia’s Qantas Airways’ loyalty program is regarded as a groundbreaking model. Qantas recorded a loss of 2.8 billion Australian dollars (about 2.228 trillion KRW) in 2014. However, it subsequently reinvested 2 billion Australian dollars (about 1.6 trillion KRW) to build a system where customers can earn points in daily life. Whether drinking a cup of coffee, dry-cleaning a shirt, or even walking a pet dog, customers can accumulate Qantas points at participating businesses. Turning customer experience into digital assets, Qantas earned more revenue from point sales than from international flight tickets in 2017.

Hong Kong’s Mass Transit Railway Corporation (MTR) operates subway and bus lines as a public enterprise. However, about half of its annual revenue comes from real estate business. Since opening its first line in 1979, MTR has purchased surrounding land during subway station development and negotiated with real estate developers. MTR’s system, which secured real assets by granting development rights around stations, has become known as the ‘Rail Plus Property’ model. MTR has recorded about 39 trillion KRW in revenue so far and earned the nickname ‘genius of real estate development.’

The idea of not being destroyed but destroying first demands a more painful, unfamiliar, and agonizing process for companies than ever before. Only pioneers who boldly disrupt and destroy to satisfy rapidly changing markets and customers can awaken from the illusion of fake innovation.

Disruptor: Market Disruptors / David Rowan / Translated by Kim Moonju / Sam & Parkers / 22,000 KRW>