The 3 principles of digital disruption: What we can learn from a mattress company

When we think about the most innovative and disruptive companies in existence today, our minds automatically gravitate towards well-known tech giants like Google and Amazon. Yet, for a business leader looking to replicate their success, attempting to gain insight from companies working on projects like autonomous vehicles or delivery drones can be daunting.

The stakes have never been higher in this disrupt-or-be-disrupted world. What is it that makes these companies so successful, and how can we capture it within and outside of the tech industry?

BTS has worked with many of the fastest growing companies in the world of software and technology. While their paths to success have been highly individual, they also follow a very similar set of core principles. The beauty of these principles is that any business can adopt them regardless of size, industry, or history.

Let’s explore these principles using two unlikely candidates: WikiHouse, an open source project to reinvent the way we make homes, and Casper, an online mattress retailer.

Principle 1 – “Superpower the Users”

Customers and end-users have evolved to fill roles once reserved for employees. In the past, important decisions around product design and go-to-market strategy were the domain of internal experts. No longer – the most successful companies today are the ones that empower users of their products to lead the way at critical junctures. In the world of software, it’s no longer about thinking up new functionality – it has become about observing what the end-users are doing, and writing code to help them do it better.

“Superpower the users” is one of the design principles at WikiHouse. The organization runs an Open Source project that allows anyone in the world to download the complete design files for an affordable do-it-yourself (DIY) micro-house, as well as the instruction manual that tells users how to put this giant “Ikea set” together.

WikiHouse aims to disrupt home design and architecture, a field where the wheel is mercilessly reinvented and the ultimate end-users, the inhabitants, have historically had very little say in the final product. What does WikiHouse do differently, and what does “superpower the users” mean in practice? The organization seeks continuous feedback from the people who assemble and live in its homes, involving experts to consolidate this input into each latest release. By integrating user feedback into its source files, WikiHouse improves the lives of future inhabitants.

Casper burst onto the mattress scene with much the same obsession over its customers as WikiHouse. Quite unlike other mattress companies, Casper has a group of 15,000 customers who are part of the product-development process, sharing sleep-tracker data that helps the company move closer and closer to what its customer base considers to be the ideal mattress with each iteration.

WikiHouse and Casper disprove the notion that only Cloud software companies can benefit from an iterative design process based on user feedback. While beneficial, the ability to push updates to existing users in an “as-a-service” environment is certainly not a requirement. Customer insights similar to those used by WikiHouse and Casper are what enabled companies like Amazon, with massive amounts of customer data, to disrupt entire industries: leveraging online book sales to stock a brick-and-mortar bookstore with bestsellers only, and using shopping trends to help determine which original series to produce and distribute. Customer data is powerful and transformative, and thinking of your end-users as your most important design partners is the easiest way to get it.

Principle 2 – Simplify

Fish organize into schools and birds into flocks because of the “predator confusion effect” – the large numbers of potential prey overload the predator’s senses, keeping the entire group safe. In this example of what economists call the “tyranny of choice,” customers and end-users too often play the role of the predator.

Customers experience confusion and unhappiness when they are not set up for decision-making success. What this translates to is lost revenues for companies in all industries. It is no coincidence that Google only offers one kind of mail service: successful technology companies have long discovered the importance of simplification.

In an industry where the top manufacturer offers 74 different types of mattresses on its website, Casper has done something truly unique by going to market with just one mattress.

This is powerful for three reasons. First, it makes it easy and painless for the customer to make a purchasing decision. Second, it allows for user feedback to be focused on one design that gets better and better with time. Third, it allows for economies of scale to occur, reducing the cost per unit and allowing the company to invest in other things that matter more to the customer, like affordability and hassle-free delivery.

Following this formula, Casper is disrupting an industry that has traditionally benefited, at the customer’s expense, from seemingly infinite choices and sales people that monopolize knowledge. It is easy to see how not customer-centric this industry has been, and how massive simplification will disrupt it, transforming it into a much more customer-obsessed one.

Principle 3 – Build using LEGO

There is an inherent conflict between the need to simplify and the need to call on your end-users as your most trusted design partners. What do you do if different customers want different things?

One way that Cloud software companies have addressed this tension is by breaking their solutions into the smallest possible functional elements, called microservices. These can then be individually assembled, like LEGO bricks, and are reusable in different applications. Once a microservices architecture is in place, it cuts down drastically on development times. It also increases quality: finding where problems occur becomes faster, and each microservice can be optimized independently. The same microservices can also be combined in different ways, making customization easy. This way, Cloud software companies can successfully maintain a single code base for their solutions.

While it is no software company, Casper treats its mattress like a “sleep platform,” where sheets, pillow cases, and mattress covers are distinct elements that can be used to personalize the basic experience.

WikiHouse is assembled using modular components that are put together by the user. The walls resemble jigsaw puzzle pieces, and even the wooden mallet used to assemble the parts is treated as a separate microservice. WikiHouse’s modularization of a larger system (the house) mimics the benefits reaped by any Cloud software provider adopting microservices. WikiHouse can individually maintain each specific building block, updating it with customer feedback to make it even better. Thus, the entire house improves in quality and becomes easier to build. Perhaps most importantly for the end-user, the elements can be put together in a myriad of different ways, allowing for an experience that is highly personal as well.

Becoming a Disruptor

We are in an age in which software is “eating the world,” as Marc Andreessen put it; in which there are only the disruptors and the disrupted. The road to becoming a disruptor is no easy task, but examples outside the world of software and technology like Casper and WikiHouse show that the same disruptive principles used by some of the leading tech companies can be successfully applied in any industry. Empowering users to lead solution design, simplifying customer interactions at every turn, and adopting a microservices mindset are actions that all businesses can take.

This article originally appeared on BTS.com:
The 3 Principles of Digital Disruption: What we can learn from a mattress company