AI & Disruption
Three signs your hierarchy is about to be bypassed
Disruption isn’t inherently evil. It’s a pressure release valve in a system that’s built up too much internal tension. And right now, that valve is AI.
Apple didn’t storm Dell with cavalry charges. Netflix didn’t lay siege to Blockbuster. Tesla didn’t march on GM’s headquarters. They just built better systems while the incumbents were busy maintaining the old ones.
But here’s what history teaches us about disruption: pretending it doesn’t exist is always, without exception, a losing strategy. The pressure finds a way out eventually. And when it does, it tends to be messy for those who spent their time polishing brass instead of reading the room.
Down the street from INSEAD sits an empty palace. The former residents resisted disruption.In Russia there is a similarly empty palace. As Bolsheviks walked in, courtiers famously worried about tracking mud on the parquet floors. The rituals continued right up until they didn’t matter anymore.
Three Signs Your Hierarchy Is About to Be Disrupted
1. Ritual Triumphs Over Function
When people spend more time guarding process than delivering results, you’re in trouble. I’ve watched this play out in organizations and where executives spend months debating committee structures while their employees, and customers, learn a better strategy from YouTube videos. The form persists, but the substance has quietly migrated elsewhere.
It’s like that moment in every dying regime when palace guards are still enforcing shoe removal protocols while the city burns outside the gates.
2. Bureaucrats Mistake Gatekeeping for Value Creation
There are entire hierarchies focused on blocking. They confuse creating friction with positive change. Their goal is to preserve the status quo no matter the revolutionaries are storming the building.
This is classic late-stage institutional behavior. When your primary source of power is your ability to slow things down, you’re not creating value. You’re a speed bump that innovation will eventually drive around.
3. Leaders Become Symbolic Rather Than Operational
The palace still has a king, but the king commands no army. Blockbuster had executives right up until they were calling the bankruptcy attorneys. Legacy consulting firms still have managing partners, but the actual innovation is happening in garages and co-working spaces.
Title inflation accelerates right before collapse. When everyone’s a “Chief” something, it usually means nobody’s actually in charge of anything that matters.
Why AI Is Different (And Why That’s Actually Good)
Unlike previous disruptions, AI doesn’t just replace tools. It replaces entire categories of thinking work. This terrifies institutions because their whole value proposition was being the exclusive gatekeepers of complex analysis.
But disruption can be a net positive if you approach it correctly. The key is recognizing that AI isn’t your competitor. It’s your force multiplier. VSTRAT doesn’t rely exclusively on AI; we harness it to make strategy frameworks more interactive and accessible than ever before.
We use AI to blend interactivity and advanced analysis, bringing long-standing strategic frameworks to life. Instead of merely teaching a concept like Porter’s Five Forces or SWOT, we use AI to model real-time scenarios, synthesize competitive data instantly, and allow planners to engage with the framework dynamically. This enables better, faster strategic planning by moving these powerful concepts from abstract lecture slides into practical, living, collaborative tools.
The mistake most institutions make is trying to preserve their current form while the world shifts underneath them. They’re like record label executives worried about CD sales while Jobs demo’d his new device, the iPod.
The Pressure Cooker Principle
Suppressing disruption doesn’t stop the pressure. It just ensures the eventual explosion is bigger and more destructive. Smart organizations release the pressure gradually by adapting, innovating, and yes, sometimes cannibalizing their own outdated models before someone else does.
The consulting firms, businesses, and business schools that will survive the AI transition aren’t the ones with the fanciest credentials or the most elaborate gatekeeping procedures. They’re the ones building better systems while their competitors, or competitive alternatives that didn’t use to even exist, are arguing about protocol.
In the end, function always beats form. Value creation always beats gatekeeping. And builders always beat guardians of empty palaces.
The valve is going to release pressure one way or another. The question isn’t whether disruption will happen. It’s whether you’ll be part of the solution or part of the rubble.