A New Age Of Digital Transformation
Companies need to get comfortable in the ever-evolving, rapidly changing digital world where consumer behavior is a moving target
Photo Credit : http://fieldserviceblog.com/
"Even if technology froze today, we have more possible ways to configure the different applications, machines, tasks, and distribution channels to create new processes and products than we could ever exhaust." - Erik Brynjolfsson and Andrew McAfee, MIT Sloan School of Management
Digital Transformation spending is expected to exceed $1.2 trillion this year, according to the latest IDC report. That's a 17.8 per cent increase over 2016 and a stark indicator that the disruption of the digital landscape is reshaping legacy business models, customer interaction, and the very nature of global markets and how companies transact with consumers.
The very definition of the words, "digital" and "technology" is evolving as wearables and IoT are added to established channels, from the web and social to mobile and gaming. At some point, the word, "digital" will likely disappear since everything is now digital. After all, what was the last analog experience you had?
The holy grail for companies now is leveraging technology to create more compelling, personally relevant, engaging experiences that lead to lasting, productive relationships, higher levels of satisfaction, and new sources of revenue. But the bar keeps moving.
It's no longer about this technology or that technology. This channel or that channel. What we are witnessing is several trends that are intersecting and combining to create "combinatorial innovation," including mobile, sensor technology (smart, connected devices), big data, on-demand cloud computing, machine learning and predictive analytics. It's the combination of available technologies that creates something greater than the sum of its parts.
The idea that technology is not linear, but rather driven by the combination of many things, was advanced in W. Brian Arthur's book, The Nature of Technology, where he argued that technology "builds itself organically from itself," bringing about unanticipated, radical disruptions.
Google Chief Economist, Hal Varian, and John Naughton, professor of the public understanding of technology at the Open University, offer these examples to put combinatorial innovation in perspective:
" Sewing Machine: Driven by the need for interchangeable parts for the munitions industry in the late eighteenth century
" Gutenberg Press: The printing press combined technologies including the screw press designed for making wine, metallurgical developments to create metal type, chemical advancements in ink, as well as error-checking mechanisms
" Self-Driving Cars: A combination of Moore's law, digital mapping, GPS, laser infrared sensor, machine-learning algorithms, massive data storage
Fast forward 5-10 years and what does the world look like when your wearable device is connected to your digital home, self-driving car, healthcare provider, commerce sites, and workplace that employs a just-in-time workforce? And they're not just talking to you but to each other?
Given the speed of change and the organic evolution of technology, it's no longer good enough just keep pace. Companies need to be looking three steps ahead or risk irrelevancy in the wake of startups nimble enough, and smart enough, to be ahead of the curve.
The Need for Agility
Legacy technologies, infrastructure, processes, and ways of working that maintain the status quo (bureaucracies, waterfall development, command-and-control structures) are still rampant among enterprises, despite their liability in this battle.
Processes that were built for yesterday were designed to address a very specific set of circumstances - ones that no longer exist or have lost relevance - leaving businesses playing catch-up with the new digital economies of consumption. To succeed in the ever-evolving, digital world, we are working with our clients who have no choice but to renew their legacy landscapes while simultaneously creating new technologies and processes to match the speed of innovation and changing consumer behaviors
The companies that will win are reimagining the relationship between business and customer that looks more like a seamless and integrated, mutually beneficial partnership than merely the transactional relationship of the past.
Flexibility and rapidness in approach are critical success factors to outperform and exponentially increase the value delivered and confidence to take risks. Additionally, companies need:
" Out-of-the-box thinking
" Executive leadership active involvement
" A startup mode approach, compared to regular services model of engagement
" Transparent processes and systems
More than anything, companies need to get comfortable in the ever-evolving, rapidly changing digital world where consumer behavior is a moving target. Category leaders need to reignite that challenger brand spirit that startups and competitors innately have, which combats complacency and keep them hungry. Those that can achieve this, along with a renew-new strategy, are the ones we'll still be talking about in ten years.
Disclaimer: The views expressed in the article above are those of the authors' and do not necessarily represent or reflect the views of this publishing house. Unless otherwise noted, the author is writing in his/her personal capacity. They are not intended and should not be thought to represent official ideas, attitudes, or policies of any agency or institution.