How your company can thrive in a digital future
Since beginning work with a company that assists other businesses in digital transformation, it’s become apparent that there is much uncertainty in business about how to plan for the future, given the current rate of change and disruption taking place across all industries. Fuelled by mass connectivity, advancements in artificial intelligence, nanotechnology and the internet of things, it’s frightening to think how much things have changed, even in my own short lifetime. The greatest worry about this change is that it has no comparable predecessor in its velocity and scale. Change is happening at a rate humanity has never before witnessed. It’s exciting, but how can we capitalise on this change…?
This article addresses the effect this revolution is having on the world of business and how corporations should prepare for a digitally dominated future.
In short, my opinion is that companies must embrace new forms of technology and use them to better understand their customers, they must adapt the principles of agile development, to be able to respond in an unpredictable world, and they must encourage every last employee to be an innovator….
Customer informedness has never been greater than in the digital era. Through digital media, consumers are able to create, propagate, and amplify content about organisations and their products. Your company’s perception is now largely based on how it fares on online review forums, price comparison websites and other democratised streams, that can be easily accessed in real-time. This represents a shift from the traditional one way brand communication, with the power now lying firmly in the customer’s hands.
The best way to adapt to this change is to move from a transactional to an interactional environment and involve the customer in the design of your products as much as possible. By co-designing products with customers, organisations are able to sense and respond readily to consumer-driven changes in needs. A great example of this is the recent growth of customer first mobile banks, such as Atom, who deliver a more personalised service compared to traditional banking, focusing on ease of use, simple application and acceptance mechanisms, and instant updating.
Personalisation is a critical tool in the digital environment. Technology has lowered barriers to entry and increased globalisation, meaning competition is now higher than ever. All one needs nowadays is a laptop and internet connection to set up a tech company. In order to stay ahead, top companies are using their vast digital resources to get closer to the customer, find out their specific needs and build something of more value to them.
Lay a framework for innovation
The rate of technological change is happening so rapidly that companies must be innovative in order to respond rapidly, if they don’t, a competitor will. Telephones took 50 years to reach 50% household penetration, compared with 28 years for radio, and only 10 for internet access. By comparison, google+ took just 10 days to reach 10 million users. Quite simply, the digital revolution is bringing about new modes of production and patterns of consumption faster than ever. A company that allows itself to be innovative in all departments can respond quickest to changing consumer needs. The digital world pays no heed to legacy systems. It’s simply the first to the table who wins, before the table shifts again.
In today’s digital world it is the most innovative, disruptive technologies that have been able to capitalise on new forms of connectivity, massively changing the way certain industries operate. Think of the huge success of Uber, using smartphone technology to provide a faster and cheaper taxi service, overhauling a whole industry in the process. This shows the tremendous success that innovation can bring about.
Build an agile business model
Companies must now model themselves to be more agile entities, to help them cope with the rate of change the digital world is bringing. Most companies now review their business model on a yearly basis, recognising that agility is needed to cope with change.
Diversification is a one aspect of an agile approach. By expanding the range of service and entangling products with services, a company can reduce the risks associated with the digital age. Companies like Google and Amazon come to mind — by increasing their range of products, they’ve added robustness to their businesses, minimising the risks posed by disruptive technologies or unforeseen losses of demand. Google is now much more than a search engine, Amazon more than an online retailer.
The truth is that no-one, not I, nor any Fortune 100 CEO, nor any mathematical model, can predict exactly how our digital society will continue to change in the future. There are just too many moving parts. However, what company leaders can do is optimise their structure and culture to be able to respond positively to the inevitable changes that will occur. Make your company customer-centric, revise your business model, reorganise at scale if necessary, or face being left behind by those who have adapted, as Charles Darwin proved,
“The most important factor in survival is neither intelligence nor strength but adaptability.”