On creative destruction: “The best way to predict the future is to invent it.”– Peter Drucker

In an era of turbulence and instability, just about any enterprising mind can initiate and participate in a process of “creative destruction”. This process often begins by observing the inner workings of a given system or situation, to spot the inefficiencies that are holding back the creation of a better future.

Sometimes, bold and proactive action is the obvious next step: to fundamentally redefine and transform the present for a better tomorrow. This is where the idea of creative destruction – another term for true innovation – can prove very useful, whether in business, in our personal lives or in politics.

"The greatest danger in turbulent times is not the turbulence itself. It's acting with yesterday's logic" – Peter Drucker.

The concept of creative destruction

The concept of creative destruction was introduced by Austrian economist and political scientist Joseph Schumpeter (1942), who saw it as the “essential fact of capitalism". It refers to the idea that in a capitalistic society, “the old way” of doing things is constantly getting destroyed or supplanted as it is replaced by a newer, better alternative.

In more general terms, "creative destruction" refers to the process whereby new innovations and technological advances are essential to introduce new ideas, new products, new production methods and even new ways of organizing a business.

Creative destruction is the force behind almost every major shift in how businesses and consumers operate. Netflix and Apple are prime examples: streaming has replaced CDs, DVDs and cable TV, leading to the demise of Blockbuster or Hollywood; smartphones have replaced cell phones, MP3 players, GPS devices, film cameras and so on... All these new devices have transformed the daily lives of millions of people, offering them a host of new functionalities previously unheard of.

We practice creative destruction throughout our lives: in adolescence, when we question the principles of our upbringing or our belief systems as we grow into adulthood, when we seek to acquire new skills to land a new job, during a divorce and in countless other situations.

How does creative destruction work?

Basically, "creative destruction" refers to the deliberate dismantling of long-established assumptions and processes, to free up resources and energy for innovation and improved ways of working.

The destruction is what allows the innovation to happen. Innovation is the driving force of creative destruction. Without innovation, creative destruction would not exist, and without innovators, there would be no change agents who could make creative destruction a reality. However, successful innovation requires innovators to have clear intentions to create long-term value.

Creative destruction involves fierce competition between old and new products or technologies, which must prove superior and more efficient than the old ones if they are to replace them. It also requires people to be willing to adapt and change their behavior. The measure of success is a significant boost to quality of life.

Although creative destruction can deliver considerable long-term benefits, it also has its downsides. As the term "destruction" implies, one must be prepared for an immediate destruction of existing structures, hopefully limited in time. What's more, the process will inevitably produce winners and losers. The rewards of creative destruction will not always be evenly shared. Finally, it may take years before sufficient evidence becomes available to assess the long-term impact of certain forms of innovation.

An illustration of “creative destruction in action”: the dissolution of the French Parliament by Mr. Macron.

More recently, President Macron's sudden dissolution of the French parliament illustrates another unprecedented and fascinating example of creative destruction.

A distinctive feature of the French electoral system is that it is designed to provide a clear majority at the end of each election, due to a two-round voting system. This unique system – foreign to most other countries in the world – was conceived by Charles De Gaulle in 1958 to deliver an unequivocal majority at the end of the second round. Yet, the system didn't work as intended in 2022, nor in 2024, when the French President only obtained a “relative” majority.

On the evening of June 9, 2024, following his party's defeat by the far-right Rassemblement National (RN) in the European elections, President Macron became the president of an “ungovernable” country and was looking for a way out. With his government likely to face a vote of no-confidence after the summer recess, he decided to take the bull by the horns. He suddenly dissolved the French parliament along with his relative majority. His apparent rationale for this swift dissolution was that, by shinning a spotlight on the RN during a short election campaign, Le Pen's RN would begin to crack. With just three years to go before the end of his presidency, it would be better to deal with the RN now and try to take the wind out of their sails, than to allow their vote to continue to grow and carry Le Pen to the Elysée in 2027.

The elections, held on June 30 (first round) and July 7 (second round), resulted in an even split between the left, the center (Macron) and the far right, with no single bloc achieving an absolute majority. This situation calls for the formation of a "grand coalition" government, that is, the building of a political consensus between the various political parties; a concept foreign to French politics since the founding of the Fifth Republic by Charles de Gaulle in 1958.

These electoral results point to a very different France today – far more divided than 20 years ago: the 2008 financial crisis has increased poverty, economic consequences of the pandemic have wrecked public finances, out-of-control immigration has deepened poverty and compromised security, and a failing education system has led to a decline of civism, to name but a few of the challenges. Looking ahead, a vastly different political landscape could prove more appropriate to the country's new realities and needs.

Macron’s ultimate goal in creatively destroying the current political system – in which no single political party can win an absolute majority in the parliament – is to transform the existing political culture and then build a new majority based on coalition and compromise, following the example of many other European countries. Under fire from critics, he is well on the way to achieving his goal, but still has a long way to go, as I write these lines.

Final thoughts

Creative destruction is an evolutionary process that has the potential to redesign the future by innovating and improving the way we use resources. The trend line is one of progress, growth and higher living standards for all.

Its implementation in business has led to major changes, which we are all witnessing today. A modern example of creative destruction: consider Apple's constant product releases. Apple routinely releases new gadgets, hardware or software that replace earlier designs. Outdated products are rendered obsolete in favor of new, innovative solutions for long-term benefit.

The transposition of this concept to our professional and personal lives – in a logic of breaking with the status quo – opens up new horizons with entirely new perspectives.

Its most recent application to French politics is unprecedented but could prove ground-breaking: it could not only lead to a major cultural shift, but also improve the everyday lives of French people.

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