Self-disrupt to Avoid Self-destruction

For sustained success in business of software, it is necessary to constantly anticipate next curve. Not only anticipate, but execute to make the jump to the next curve early on. But often, incumbents become victims to innovator's dilemma (book reference: Innovator's Dilemma) and fear to self-disrupt and in the process get self-destructed. They don't want to strangle their current roadmap that is bringing in revenue. And, surely, they don't want to upset Wall Street.

However, Apple is one of the organization that is self-disrupting in the space of consumer electronics. Apple's iPhone is a good example of self-disruption. Apple's iPhone is an early indicator of self-disruption of its very own product - iPod - that won Apple back its lost glory. iPhone will eventually replace iPod. This might not happen this year or next, but in future not far away from today.

For any organization, big or small, self-disruption should be a built in trait to maintain long term leadership in its business. They can do so in following ways:
1. By having next generation of themselves (a different business unit or a spin-off), whose sole responsibility is to attain leadership on the next curve. In doing so, they might and should take away revenues from their parent company who is still a leader on older curve. This way the parent company will lose its market share, but only to the next generation of itself.

2. Other approach to self-disruption is to acquire company(s) who are already on the next curve. Even though this seems to be dull and not-so-challenging approach as compared to #1, it is a practical one. Instead of placing bets and investment on next curve, its definitely better to shop-and-compare for proven companies who are on their way to become leaders on the next curve. Such an acquistion approach also works out well for software business ecosystem. Smaller startups can innovate at a greater velocity than bigger organizations. Bigger organizations, on other hand, get to shop-compare-buy and not risk their investments based on speculation of next curve. Also, after certain stage, smaller startups can flourish better under big banner organization by taking advantage of its branding, sales, marketing, customer support and other infrastructure.