IT Focus Area: Business Innovation
July 2, 2018
The Vortex of Change and Digital Foundations of Success
Are you a proponent for change within your organization? Maybe the better question is, are your employees and management teams supportive of change?
According to McKinsey research, 70 percent of companies fail when launching a large-scale transformation strategy. Can you guess why? Their research finds that employee resistance and unsupportive management behavior hinder success, setting companies further back from major improvements in long-term performance. Not only that, these setbacks cause a dip in morale or, perhaps worse, result in having to start from scratch.
Backed or not, we are all in the vice-like grip of the vortex of change, and it is gaining momentum at an exponential rate.
Perhaps you’re just starting to build a transformation plan; or maybe you already have a grip on what you want to accomplish, but you can’t seem to overcome obstacles related to culture, organizational structure, technology, or social/political issues.
Nonetheless, if you don’t start making advancements in your transformation strategy, you’ll be left behind. Consider these stats:
- This year, 1/3 of business in the top 20 in every industry will be disrupted by digitally transformed competitors, according to IDC's Battle for Dominance and Survival.
- Innovative brands experience brand value appreciation nine times more than brands that are perceived to be less innovative, according to Kantar Millward Brown, BrandZ Top 100 Most Valuable Global Brands.
- By 2025, 150 million of knowledge worker jobs will be replaced by cognitive robots, according to a Forrester report.
The legacy that made a company successful in the past might hold it back in the future. However, that doesn’t mean disregarding traditional business models. It’s important for organizations to blend the two, yielding in a harmonious fusion that cultivates innovation and a prosperous future.
Drones, robotics, cognitive computing, smart advisors, mixed reality, and distributed ledgers are just some of the innovations that are completely redefining our relationship to life, work and the planet. With the fourth Industrial Revolution just ahead, a new era of fusing of physical, digital and biological systems is helping companies build new strategies.
It won’t be long until millennials make up the majority of the consumer marketplace. According to Accenture, each year millennials spend approximately $600 billion in the U.S.
To support your organization’s plan for modernization, and to keep up with the expectations of millennials, it’s important to develop, retain and acquire the right people, across the generational gaps.
Businesses must invest in talented individuals from different age scales who can bring different expertise to their organization, which will also bring different perspectives to your innovation ventures.
3 Digital Foundations of Today’s Enterprises
To continue innovation, businesses must ensure sound digital foundations. Here are three characteristics companies must embrace for successful digital transformation.
All roads lead to data. Data has essentially become the raw material for the digital age, but not only that, data is exploding. With all of the available data, organizations must monetize it further and leverage the technologies that will set them apart. Many organizations are leveraging data to implement sales, marketing and operations strategies, including sentiment analysis, geomarketing, buyer protection programs, risk management, and operational efficiency and safety.
One of the more buzzworthy technologies being used is artificial intelligence (AI)―more specifically machine learning―which can identify patterns and make decisions more quickly than humans.
The entertainment industry is using AI and data in a big way. If you’ve seen Netflix’s customized “Top Picks” for you or the “Because you watched…” recommendations, then you’ve witnessed the results of AI. Netflix uses AI to build specific content lists and intelligent recommendations to help you find your next binge-worthy series. The company also uses big data to create new shows. In fact, the creation of the successful show “House of Cards” initiated from a big data project. Netflix trusted the data so much, they committed to two seasons before even airing the first episode―and the data didn’t lie. Brands are spending hundreds of thousands of dollars for their products to be placed in the show. Moreover, some are calling the project “one big successful marketing experiment.”
Trust is at the heart of any company’s brand identity. It takes a long time to develop trust, but you can lose the trust of your customers or partners at the drop of a hat.
What are some examples of brands that you trust? Why do you trust them? What attributes do they have that your brand doesn’t?
There isn’t an easy button when it comes to being a trusted company. Below are three attributes of a trusted brand your enterprise should embrace:
- Authenticity: Being faithful to what you sell or represent.
- Capability: Having a consistent offering that sets your brand apart from others.
- Transparency: Providing detailed descriptions of your products (how they fit, how they feel, what’s in them, who made them, etc.).
- Security: Overcoming risk to achieve a virtuous cycle of growth is an extremely costly, complex and time-consuming problem. Companies must have a security plan that can handle your plans for change.
3) Connected Experiences & Smart Technology
Your customers want a well-developed and fluid experience. To begin that task, you must know what your customers want. As stated before, all roads lead to data. Your data is the anchor point to developing an effective strategy.
Smart technology, such as wearables (i.e. wristband sensors, body-worn cameras and headsets), is transforming all types of industries. The healthcare industry is using remote monitors and wearable sensors to allow medical professionals to better manage patients through connected devices. They’re being used in pharmacies, labs, patient rooms, and imaging to help speed the flow of patient results and records. Predictive models can also help monitor prescription inventory when pharmacy shelves are low, or even help treat illnesses.
Here’s the bottom-line: Business models are being turned upside down—from traditional, to digital, to autonomous. These tectonic shifts affect every industry. Disruptors are being disrupted; disruptors are disrupting themselves. Time is no longer linear, and size is no longer a guarantee of success. To stay ahead, it’s imperative for organizations to innovate, fail fast, learn, and iterate. Everyone is affected, so start calculating your company’s plan in response to the vortex of change.