SBJ/Nov. 4-10, 2013/Opinion

How to spot, benefit from next disruptive innovation in sports

Here’s the scenario: You’re stuck in an airport, and out of sheer boredom you wander into the concourse bookstore to consider a reading purchase. Suddenly, you notice an abundance of business books related to technology’s impact on business, management and leadership. Logical, right?

But maybe that’s just the beginning. Maybe you’re supposed to be wondering about the process of disruptive technology in sports. Are you ready for the pending convergence of television, Internet, radio and voice into one device? Are you considering what impending development might next change the dynamics of your sport, like aero lightweight frames in cycling? What about forecasting those unexpected new markets, like the thousands now competing in Warrior, Spartan, Tough Mudder and, our new favorite, “zombie” runs?

Our attention was piqued about a year ago in Australia. It started with a line of research with two academic colleagues (Ann Pegoraro of Laurentian University’s School of Sports Administration and Nadège Levallet at Queen’s University’s School of Business) on “disruptive innovation.” By definition, that phrase includes any change or evolution that has more than an expected change on the industry. From a scholarly standpoint, we are seeking to model these innovations and then try to arm practitioners with a framework by which to forecast their arrival and navigate their reality.

That sounds attractive, but practically, it’s tricky. Things that are disruptive often are resisted, and in the following examples you may see what really happens when disruption occurs.

Events like the Tough Mudder races created a whole new market for endurance sports.
Photo by: GETTY IMAGES
If we go back in time, we can talk about athletic concepts like the development of titanium drivers in golf or curved sticks in ice hockey. These were product innovations that changed the game. But let’s look at how the game was managed. What did Danny Biasone’s 24-second clock do to professional basketball? How did Title IX change the dynamics of the NCAA? How did Billy Beane’s “Moneyball” approach influence the data-mining revolution in team sports?

There are others we could cite, such as the American League adding a designated hitter rule or various leagues instituting salary caps, granting free agency or establishing player drafts to foster or ensure league parity. We could go down the safety route as well and talk about devices like pop-up vents on race cars (to keep them from flying into the crowd) or the NHL’s recent mandate to include visors as mandatory wear.

At the venue level, we could discuss personal seat licenses, the creation of luxury boxes at stadiums or the advent of electronic tickets to replace paper ducats.

We could go on, as you could, with examples that were very disruptive or were just a logical progression of technology that was expected or overdue. Indeed, the list in this run of examples would be almost endless since sports has required numerous innovations to keep games and races safe, exciting, and sustainable.

But here’s a key thought for you: In the technology world, discussions on innovation and disruption are as regular as nightly scores and player updates. That means the key in this discussion is helping owners, management and sports marketers spot disruptive opportunities before they arrive and then help them to adapt or make them happen. After that, someone, usually a commissioner or a series operator, needs to deal with them.

This leads to a series of questions:
n Have you heard about material printing, where scientists are now able to print golf clubs, running shoes and other sports equipment on demand? The potential to disrupt the entire manufacturing process is already there. It may be many years away or perhaps is already racing at us.

Are you regularly scanning blogs and industry reports for new developments?

Are you staying in touch with that wise old professor of yours to see what he or she is observing?

Do you really understand what the process of disruptive change is and how much more to expect in the future?

We’re early in the research process, but two steps are critical. First, practitioners in club management, marketing agencies and corporate sponsors all need human resources at their organizations who are in the know and constantly watching for disruptive clues as they occur. This means these “forecasters” are researching their industry (or segment) and all the elements that could disrupt it. More than likely, these folks are doing Web research, following scientific journals, attending key conferences and informing their colleagues that something unusual is happening.
For example, in 1989, if cyclist Laurent Fignon had employed a coach or adviser who understood aerodynamics and new equipment, he could have adopted the new technology like Greg LeMond did and, in turn, possibly have captured his third Tour de France (as opposed to finishing second).

Second, someone at the organization has to respond when the alarm is sounded and include these potential disruptions in the annual planning process. This, we know, is easier said than done. But look at Silicon Valley and tech startups: They deal with this hourly.

We think this is an annual consideration (or should be) and that numerous agents inside the organization need to be ready with resources in place. That’s easy to suggest when you are camped out in the ivory tower as we are, or pushing others in the communal think tank. But the rate of change, particularly in technology, is quicker than you think. Logically, it must be almost as fast in sports since our industry relies on technology to keep the fans and consumers buying our respective products and services.

Remember: Evolution rewards those who adapt the fastest and most efficiently.

Rick Burton (rhburton@syr.edu) is the David B. Falk Professor of Sport Management at Syracuse University. Norm O’Reilly (norman.oreilly@ottawa.com.ca) is a professor of sport business at the University of Ottawa.

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