Rhenald Kasali: Disrupt Innovation, This Industry Shattered in 5-10 Years

INDUSTRY.co.id - Jakarta - The phenomenon of disruption or change in the way and business fundamentals, one of which is due to the digital technology revolution is predicted to last for 100 years. Companies that still retain the ancient business model, sooner or later certainly will be affected by disruption.

This is said Professor of the Faculty of Economics and Business University of Indonesia (UI), Rhenald Kasali in Jakarta, Thursday (7/12/2017). "This disruption is still 100 years long, the short term is fashionista or style, selfie," he said.

In this process of economic change, Rhenald said, there are industries that are worry. Call it the conventional transportation service industry that has been replaced with online transportation. Including the conventional retail industry, hotels, and travel that has undergone massive changes in quick time.

"The destruction process of this disruption will happen for about 5-10 years, some fast and slow, which is the hotel service industry, travel, transportation, while the old manufacturing industry because it is controlled by the company can not be shared," he explained.

Another industry that is subject to change is insurance. Rhenald Kasali says, 70 percent of the current premium is given to foster insurance agents. The cost is very expensive.

"One day there will be a new way that will go straight without an agent, because if the price is overpriced or something is expensive, then it will certainly get disrupted to be cheaper," Rhenald explained.

The theory of change, Rhenald says appears every 200 years. Economic figures, Robert Malthus had predicted the earth would lose against human growth. In 1800, the world population reached 1 billion, and became 7.4 billion in 2016.

"Every 11 years add 1 billion people, and the price of fuel oil does not go up, the economy is wriggling, motorcycle behavior, subsidies are getting heavier because we are importing fuel with expensive price," he said.

After that 200 years later, Rhenald called Clayton Christensen in 1997 forecast to be destroyed in old ways, such as conventional business models.

"In 2007 it was predicted that the incidents of retail in the United States (US) collapse due to the emergence of a new platform (online) that is not understood by many people," he said.

President Commissioner of PT Angkasa Pura II asserted that the fall of big companies such as Kodak, Nokia, and a number of retail giants at home and abroad not because of purchasing power, but because of the era of disruption.

"This is disruption, not the purchasing power of the streets, which is a lot, the number of passengers rises 15 percent-25 percent, and other phenomena. If the turnover of Indomart and Alfamart down, so it is fair on a highway there are 12 outlets, down, "Rhenald explained.

He further said, companies that initially provide services at a free tariff, as Google grows into a large company. But on the other hand, companies or entrepreneurs who sell luxury handbags have difficulty because of the operational costs to rent locations, hire designers is very expensive.

"The upper middle class that has been dominating the market, enjoying the market, all disrupted, bigger companies are in trouble now, the happiest the bottom, because all can do business," said Rhenald.