Next up in this transformation series is the eighth enabler: the evolution from descriptive to predictive analytics. At the heart of future success lies the ability to leverage insight for competitive advantage. Yet, analytic capability and data driven cultures are lacking in most organizations, and most executives when assessing their positioning on a descriptive-to-prescriptive scale answer level one. The table below defines each level:
Inside the Next Transition
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A Closer Look at Transformation: Collective Intelligence
Next up in this transformation series is the seventh enabler: Collective Intelligence. One of the key themes throughout this transformation series is the clear movement from an enterprise entity to an extended enterprise of stakeholders. This extended enterprise – or what I alternatively call value ecosystem – increases complexity and requires a new management approach to be effective. I use the term collective intelligence as an umbrella phrase that combines the critical need for both collaboration and analytic excellence. This includes other forces like crowd computing, crowdsourcing, co-creation, and wisdom of the crowd – all of which stem from the connectedness of our world, and the growing realization that value creation requires a broader community.
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A Closer Look at Transformation: Sense and Respond Systems
Next up in this transformations series is the sixth enabler: sense and respond systems. These systems are critical to the transformation agenda, as most of the disruptive technologies likely to impact the enterprise in the next decade have data at its core. The resulting data explosion promises to complicate information management for most companies. As the speed of business accelerates and the amount of data flowing through company ecosystems expands, the need to sense stimuli and enable a real time response intensifies. Fortunately, rapid advancements in the price and performance of technology make realizing this sense and respond paradigm achievable and economical for a wide range of use cases – but this is arguably one of the most difficult components of transformation road maps.
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A Closer Look at Transformation: Next Generation Experiences
Next up in this transformations series is the fourth enabler: next generation experiences. As we are now deep into this transformation series, some of the drivers and tactics are similar across the various enablers, so you will start to see some redundancy across posts. The issues of customer experience, customer-centricity, and customer intimacy are top-of-mind and dominate many executive discussions and conference agendas. According to Forrester, only 3% of companies manage to succeed at delivering an excellent customer experience, but 60% intend to use customer experience as a strategic differentiator. Driven by the rapid commoditization of products and services, the speed at which new market entrants emerge, and the rise of consumerization, experience is now the new battle ground – and sustainable competitive advantage is the prize. But as Forrester concludes in their book Outside-in, customer experience remains the most misunderstood element of corporate strategy today.
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MIT Big Data Panel Discussion
In May, I participated in a Big Data panel discussion at the 2013 MIT Sloan CIO Symposium. The panel was moderated by Tom Davenport, Harvard Professor and co-founder of the International Institute for Analytics. The panel participants aside from myself were:
- Annabelle Bexiga, CIO, TIAA-CREF
- Jack Norris, CMO, MapR
- Keith Collins, SVP, CIO & CTO, SAS Institute
- Michael Chui – Senior Fellow, Mckinsey Global Institute
This was a very good discussion on the potential of Big Data and the possible direction it takes in the future. Michael Chui did a great job with his opening remarks, referencing this Mckinsey Report and using examples from it. This report, which I have mentioned previously, focuses on major disruptive technology. It is interesting to hear the perspectives (and sometimes biases) of these industry players. It’s an hour and ten minutes long, with some very good audience questions.
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A Closer Look at Transformation: Value Ecosystems
The next focus of this transformation series shifts to the emergence of value ecosystems and their role in driving the Enterprise of 2020. As we look at the Apple ecosystem and offerings like the connected car, mobile commerce, energy efficiency, electric cars, eHealthcare, and energy performance contracts, we can see the lines between industries blurring. Some even question the relevance of Industry constructs in the future. As this phenomenon accelerates, more and more companies must identify the relevant ecosystem(s) that enable their growth strategies. These value ecosystems are complex and relationship-oriented, representing future growth opportunities that are increasingly outside a company’s traditional business.
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A Closer Look at Transformation: Edge-Driven Design
Next up in this transformation series is edge-driven design, the second enabler. This key enabler is growing in importance as developed economies are moving away from command and control models and towards edge interaction that is value-based. The design principles of our past where the core (Systems of record) drove design and the edge adapted do not support this shift. This future state requires the edge to drive design from the outside-in and a core that is adaptive. This reversal in design principles supports two future dynamics: 1) Value is increasingly created by an ability to connect capabilities across organizations within an ecosystem of services, and 2) The shift from a transactional paradigm to an experiential one. An edge-driven design addresses both of these dynamics and begins to instill a fast, iterative and responsive culture.
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A Closer Look at Transformation: Digital DNA
This closer look at transformation continues with part five focused on Digital DNA; the sixth forcing function. My perspective on Digital DNA is based on a view of the business environment that is likely to exist in 2020. Enterprise DNA must reflect those characteristics that enable success in the digital world likely to exist in seven years. Business speed in the next decade and the rapid rate of change makes Digital DNA critical to future success. Today, Internet companies like Facebook, Twitter, Amazon, Apple, Google and others have fairly high Digital DNA quotients. Start-ups are born with much more Digital DNA than traditional companies, and the rate and ease at which start-ups are entering the market will continue to create a competitive environment where traditional companies are disadvantaged. Since most companies are traditional companies, the majority will enter business transformation from a challenging legacy position.
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A Closer Look at Transformation: Growth
2014 will see an acceleration and expansion of transformation programs. All the dynamics are in place to create a compelling reason for companies to transform. This 14 part series takes a closer look at transformation and the likely path it takes in the next decade. This is the first piece in the series. Links to the other parts of the series are included at the end of this post.
In my last Post , I focused on three recent thought leadership pieces:
- Middle class job Creation – Geoffrey Moore
- Disruptive Technologies – Mckinsey
- New Machine Age – Andrew McAfee
These pieces continue to describe the transformative period that lies ahead. As we look at this and other thought provoking pieces, our job as leaders is to assess the potential impact to our organizations. Readers of my Blog know that I have focused my own assessment on the enterprise of 2020, or what I have been calling the Digital Enterprise. So I have worked to develop a high level road map based on my own perspective and experiences, ongoing executive dialog, and key pieces of market thought leadership. I will use the next several Blog posts to summarize my thinking. The road map is focused in two key areas: The forcing functions that drive the need to transform and the enablers that require investment to get us there. Forcing functions are those things that force the enterprise to invest in a future state. The forcing functions and a vision to address them are critical, as far too many leaders continue to sit on the sidelines with no impetus to invest in this future enterprise.
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The New Machine Age
I recently participated in a panel discussion at an MIT CIO Symposium and had the pleasure of hearing Andrew McAfee talk about the book he co-authored with Erik Brynjolfsson titled Race against the Machine. Mr. McAfee has talked at length about the digital revolution and its impact on the workforce. He talked about the dawn of a new machine age, where the focus is on idea production versus physical production, and knowledge work versus manual labor. He focused on the most impactful period in human history – the advent of the steam engine that ushered in the first industrial revolution. A lengthy period that followed the first machine age was transformative and disruptive. We are on the verge of something that history may someday view as more transformative and disruptive. A quote from Mr. McAfee summed up his thoughts:
“Digital will make a mockery of everything that came before it”.
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Geoffrey Moore: Middle Class Job Creation in the Digital Era
Geoffrey Moore recently authored a Report focusing on middle class job creation in the Digital Era. These same forces that Mr. Moore describes in the context of job creation are disrupting the very fabric of the traditional company. This is a fascinating look at the state of middle class jobs in developed countries. This diagram from the report effectively summarizes his views on the topic. The grid focuses on the nine basic areas of employment inside an enterprise, across a product and a service business model. The columns are further divided into complex (B2B) and volume (B2C) businesses.
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Where are we on the Bring your own Device Journey?
As I prepared recently to moderate a CIO panel discussion regarding the “bring your own device” (BYOD) journey of three companies, I took a hard look at the current state of BYOD. Before I get to that, let’s set a common definition for BYOD. Wikipedia defines it as the policy of permitting employees to bring personally owned mobile devices (laptops, tablets, and smart phones) to their workplace, and use those devices to access privileged company information and applications. Gartner defines it in a recent Report this way: the ability for users and business partners to leverage personally selected and purchased devices to access business data with the option of including PCs in a BYOD strategy; and the possibility of a company subsidy for the purchase of devices.
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