What You Need To Know About Building The Foundations For Sustainably Profitable Revenue Growth And Securing Your Journey To Society 5.0
Introducing Transformation Analytics – The Innovative Way To Achieve Sustainable Enterprise Revenue and Profitability Growth Whilst Transforming To Society 5.0 capabilities.
A timely game changing question: What happens in a race where everybody is optimizing bicycles for a profit and someone introduces a sustainably green electric scooter experience?
The face of business and enterprise profitability management is changing for the good. The zeitgeist and power of Generation Z, combined with advances in technology, with growing awareness, attitude and values, is driving a societal level change that demands attention from every individual, business, enterprise, and government.
Advanced profitability management to drive sustainable business is required now more so than ever. Measured finite contribution derived from a fully loaded increasing interplay of complex dynamic sophisticated and evolving array of activities events and lifecycles combined in new business model variants serving new segments and consumers of which there is no prior precedent – is required as a requisite to rapidly harvest then inform targeted growth investments and distributions of profit.
Society 5.0 readiness as an Intelligent Enterprise is the target operating model.
It’s no longer just about making things sustainable and boasting about how much carbon offset has been achieved; assigning this to a cost centre and looking for some indirect benefit or payoff. It’s about embedding broader ESG (Environment Social Governance) objectives and metrics into the very experience of your offers, brand promise and values, making a direct emotional connection, and capturing a direct multiplier of value for your efforts as reward.
Society 5.0 – A Difficult Start Position. That being said, there are still pressing Technology and capability constraints to be solved hanging over from the present constraints that if not addressed as part of the shift – will prevent success in the new. Disparate legacy systems, disjointed unsophisticated datasets, limited competency, capacity, and cash with conflicting urgent priories to name a few.
The journey is therefore much more about managing transitions than starting new. The bulk of our wealth as traditional business must be used to finance the new. Evolution on a more revolutionary technological platform is the way it works and has always worked for stabilised enterprises. Steam to electrics. Telecoms, radio, mobile, and more recently connected mass compute.
Upstart innovators at scale will be ahead in this game. Most fail but some will make it through. They are the Google’s and Amazon’s of the past 20 years, the Air BnB and Netflix of the past 10 years … history will tell us what we will see in the next 10 years that are as big as these giants.
We can say for certain two things 1) they are already here if only we can see them, 2) just like not all start ups will survive in this rapid change, not all traditional businesses that exist today will make it across.
Despite most firms having spent the past 25 years laying foundation systems of ERP, CRM, Supply Chain, etc, they now look to use IoT (internet of things), Mobility, Social, Behavioral and Spatial solutions, the crucial data management layer – that provides intelligence – is still unable to curate a true and timely story of business performance.
Despite more recent advances in technology, and a critical mass of awareness through big data, know-how and accelerated understanding around the need for data, insights and the holy grail – stronger Profitability Management due to market forces as noted above, research has shown that Profitability Management is satisfactory in less than 8% of organisations.
This is a massive problem for traditional enterprises that need to adapt to succeed in tomorrow’s Society 5.0 economy. If basic actionable profitability management is hard to achieve today on existing business models, the pressures with directional trends like “Segment and Batch of One”, sustainable profitable lifecycle experiences, organisational complexity and range are set to explode.
The execution challenge of dealing with transitioning to this new world is already putting many organizations’ profit gradient into flat line or even trending negative, with no visibility or active levers on the control surfaces that drive sustainable profitable growth and remove operational complexity.
The good news is, with modern technology the right approach and leadership and value net partnering there’s a way forward for certain organizations that make the right moves. This will enable them to thrive and prosper with this new market reality towards a society 5.0 contribution.
It involves a step of change in technology to enable a new business capability. This translates into a 1–2 year competitive advantage that can be used to gain a game changing market share and momentum to secure a sustainably profitable future.
1. What is DIFFICULT about this Society 5.0 challenge?
With digital transformation the overriding priority to secure a future, free cash, build capacity, grow and acquire competencies, large, complex, multi-national consumer and retail organizations must firstly, quickly and dramatically change the direction and gradient of their profit curve to finance their journey, and facilitate leadership within their sector.
They must acquire better levers and instruments to gain more transparency and active control over operational surfaces and touch points that drive exponential cost or growth and value in their business. They must function by systemically managing and optimizing their profitability from a point to enterprise scale, accelerating, enhancing and building on what they are currently investing in to solve the urgent problem — whilst conserving everything and wasting nothing worthwhile. This way, they can quickly and substantially outperform their toughest competitors.
Profitability management is a very difficult age-old problem that firms have been working on for years. Every new capability to know more drives more success. In marketing direct response it’s already the case. Knowing which adverts are profitable and yield most, enable more profitable market development investment. Those that have no clue can market to Consumer trends and innovate but still lose. Consumer trends, increased channels, digital availability and keeping up with technology have made this more difficult and even more pressing.
2. What is INTERESTING about this journey and destination challenge?
You must specialise and thrive on the front line of operational activity — directly addressing the consumer industry profit killer trend towards the treatment of “Sustainable Segment and Batches of One” across organizational collaborative management groups. You must systemically optimize the nexus of Cost, Operations and Customer Offerings and experiences that build loyalty to ‘the’ customer through emotional connection. You must drive visibility of operations back into the enterprise to build a common end-to-end execution process view, which is not available today. By so doing, you will highlight new detail, context, relationships and correlations lost in and between current functions and silos. This is experienced in the day-to-day friction (cost) within the business and manifests at the end of a period only on an abstracted summary level, making it impossible to act upon meaningfully in the traditional line item and even functional P&L. These pain points have so far remained concealed and hidden beyond current line of sight and reach and technologies. Connecting this data through enrichment and insight stabilizes chaos cost and revenue growth through better visibility, orchestration and collaboration. In the process, you can unlock significant value that is today burned in the growing friction in so many ways. The correlations will be interesting, insightful and often surprising, and when applied continually and incrementally, they become game changing and sustainable.
3. What is there to be aware of that is not OBVIOUS to an outside observer?
You must first resolve the traditional hard to get cost-to-serve and net revenue snap shot type of data capture and the curation and consumption problem that large complex firms are struggling with today, even with the most advanced tools available to them. To solve this you must first make this data challenge apparently 100 times more difficult by expanding as opposed to contracting the datasets! This flies in the face of conventional wisdom but if you think for a moment it makes sense. More granularity gives you more precision. More granularity is more data. Just like a 4K or 8k tv picture it’s got more data and more technology but the picture is clearer. Will you get more clarity of operations and customer behaviour and experience dependencies by simplifying and standardising and reducing the data flows and technology?
By expanding the datasets – You can build the necessary operational context, in order to achieve the results possible with advanced data curation solutions. Capture in full detail the end to end revenue and cost drivers and within and across function interdependencies. In contrast to traditional approaches where teams are constrained by the quality of questions they can ask, with rich contextualised insights across functions teams are enabled to ask deep new questions they did not even know to ask, and find answers quickly.
This then begs the question as to whether you are solving the right problems today – and in all likelihood you are not. This is how you can claim to get “The results” and have the necessary impact to start a compelling quest for a new form of continuous improvement. Your work is fundamentally different in nature as a result of the insight and context provided from new insights, which is beyond the reach of traditional approaches.
4. WHY is this Society 5.0 journey worth doing, why would someone find this compelling?
As a leader, you have first mover advantage and in the game where winner takes all you are guaranteed a head start on your traditional competition and a continued leadership innovation and drive. Moreover as a traditional enterprise making the shift to society 5.0 models and values – if you act fast and well you can leverage your existing cash cow operations to build new rapid momentum fast to out perform the new upstarts that do not have the baggage.
In Society 5.0 where the real world experiences are digitised traditional businesses can exercise an advantage. Amazon recognise this by buying up brick and mortar business like whole foods. Traditional enterprises can leapfrog Amazon models by appealing emotionally with societal values to new and existing consumers.
Deep new insights applied to the real world operations like Amazon are doing, can help you win in your industry with a new game changing approach to enterprise operational optimization in the market that will transform your business setting to a new benchmark. Organizations failing to correctly recognize and respond to the challenge and opportunity of sustainable profitability management, who do not embrace this new capability and technology, will increasingly struggle as their marketshare and growth diminishes, their share price sinks, their talent leaves, their costs explode due to an exodus of customers moving to more capable competitors offering better emotional connections and experiences, and their fight to retain their standing in the new world is lost.
5. If you succeed in our mission/goals/objectives, what would be the economic upside for everyone involved?
You could immediately add a minimum of .5% of your revenue onto your bottom line. From bad practices holding you back. This will drive up your profit gradient (curve) and start to enable you to lead your field. At this point as a maximised and amplified market leader, secondary follow the leader forces start to kick in, amplifying returns through market share, economies of scale and smart choices. You can define and create sustainable industry leading business models and reset the operating structure of your global business to better save, find and make more money in ways yet to be considered.
Sustainably profitable growth and your contribution to Society 5.0 can be achieved with people data and technology advances correctly applied will give to give you the Digital | Edge.
