This closer look at transformation now shifts to the enablers. By way of summary, we have covered the forcing function piece of the diagram below; those forces that drive leaders to invest in a future state. In the absence of a burning platform, one must turn to vision as a catalyst for change in what promises to be the most transformative period in history. Once the impetus for change is established, what are the enablers of change? Where do companies invest to move towards that future state? The enabler side of the visual identifies those facilitators of change that allow us to address the forcing functions and build a path towards the future. The next nine posts will address each of these individually, starting with structural change.
Part six wraps up our Digital Enterprise road map series with a focus on moving insight delivery from descriptive to prescriptive. Throughout this series, I have stressed the importance of analytic excellence to long term success. But current methods such as traditional business intelligence (BI) focus on reporting and analysis that seeks to answer questions related to past events – what happened. Advanced analytics seeks to answer questions such as: why is this happening, what if these trends continue, what will happen next (predict), and what is the best that can happen (prescribe). There is a growing view that prescribing outcomes is the ultimate role of analytics. To accomplish this, analytic initiatives need to leverage an insight-action-outcome framework that starts by defining outcome-enabling insight and ends with a focus on data provisioning.
A new short Video featuring Tonya McKinney and I is now available on the TCS website. The focus of the video is the broadening role that Digital will play in the future enterprise. It’s no secret that I still see too many companies limiting their digital perspective to Marketing. Digital will eventually be viewed as the biggest disruptive force business has ever seen. Yet so many companies still have a business as usual view of the world. You can read about our perspective on the critical path forward via this Blog or through the TCS Perspective Series.
Geoffrey Moore introduced the Systems of Engagement concept about two years ago. This vision for the future of Information Technology is gaining broader acceptance – but a surprising number of executives are blind to the coming sea change. Is it hype or reality? For me, this question boils down to one certainty: traditional companies must infuse their organizations with digital DNA – and I believe systems of engagement accomplish this. They raise Digital DNA quotients by using consumer technology to make companies more effective. This notion of effectiveness is a key shift from a two decade long focus on efficiency. That’s not to say the importance of efficiency has diminished, in fact I’d say the next phase in the search for efficiency gains is upon us. But at the same time, effectiveness will headline a decade long journey focused on growth. The same platform that enables next generation efficiency – Mobile, Social, Big Data, Analytics and Cloud Computing – forms the foundation for effectiveness through systems of engagement.
My belief that digital is still very misunderstood is growing stronger. Instead of understanding digital to be the transformative engine that drives sustainability – it is still viewed as an offering or channel. Those are indeed critical pieces of the digital story, but it’s not the whole story. Those very innovations that drive our current disruptive environment – transform us to deal with the aftermath. Our customers have shifted – and we can’t shift with them if we are inhibited by traditional views of digital. I participated in a recent think tank discussion, where people talked of digital’s small contribution to revenue, concluding that it was not worth the focus.
Ted Schadler and John McCarthy of Forrester just completed a report titled “Mobile Is the New Face of Engagement”. I had the pleasure of moderating a panel discussion at a TCS Innovation Forum last week, where Ted served as part of the panel. Prior to the panel discussion, Ted used a 45 minute presentation to effectively summarize the content of the new report. He provided a written summary via his Blog yesterday.
The future of sustained competitive advantage hinges on the ability to effectively manage the collision of disruptive innovations. The digital disruption driven by Mobile, Social, Big Data, Cloud and the Consumerization of IT is impacting every industry. To date, much has been said about these individual areas of innovation. But the areas of intersection – critical to creating value from these innovations – have mostly been ignored. As innovations collide, the intersection must be effectively managed – or the result is distributed chaos. As the digital disruption takes hold across every company, in every industry, the need to transform becomes a business imperative – and future digital strategies will define success or failure.
2011 in my mind will be viewed as the launching point of a digital revolution. The momentum started in 2010 and kicked into overdrive in 2011. The rapid adoption of tablets and Smartphones fueled an aggressive development of mobile applications, while E-Book sales increased at a remarkable pace. Meanwhile, the world continued to go social in ways that few would have imagined. World leaders felt the power of Social Media, as revolutions expanded through the organizing power of Facebook and Twitter. Business leaders came to grips with the power of social media, as skepticism waned and social business turned the corner. Data continued to grow exponentially, expanding the gulf between available data and meaningful insight. Lastly, 2011 marked the year that cloud computing burst onto the enterprise landscape – In fact, 2011 may eventually be viewed as the year of the Cloud.
These factors combined to drive an aggressive digital expansion that in most cases happened through isolated initiatives driven by marketing. Businesses with indirect channels to market looked towards direct to consumer models. Regulated industries embraced the opportunity of social media, while addressing its risk. Customer experience became the mantra for many businesses, as re-inventing customer relationships topped most priority lists. New digital executive positions were created in response to growing questions about effective governance models. The notion of holistic digital strategies was in fashion again, and innovation and operating dexterity rounded out the top priorities for most executives in 2011.
As I reflect upon a month full of customer discussion, it becomes clearer that future and sustained competitive advantage hinge on excellence in two critical areas: collaboration and analytics. The need for a relationship-based enterprise becomes more apparent as we look at the critical need to:
- Re-invent customer relationships
- Leverage the collective knowledge and talent of our organization
- Partner to facilitate operating dexterity
This relationship imperative makes collaboration excellence a critical success factor; and a key enabler is social computing. I don’t mean Facebook, Twitter, LinkedIn, or YouTube (although they play a role) but rather the use of social technologies to drive effective collaboration and communication. This evolution to social business moves the enterprise up the collaboration axis as described in the diagram below.
In a recent presentation, Forrester describes the uniqueness of our current business environment as a perfect storm of technology innovation. In the past, technology cycles were driven by one major innovation (mainframe computing, personal computing, networked computing). The current environment sees a perfect storm of cloud computing, social business, mobile computing, advanced analytics and smart computing. This latest cycle begins a period of accelerated innovation, and introduces a larger potential for disruption than in past cycles.
Disruption in many different forms is not just possible, but likely. Business models across many industries are already under attack. The Information Technology (IT) function itself will see considerable change over the next several years. As the workforce and business leaders play a bigger role in technology selection, the role of IT will evolve. What IT looks like in the future is anyone’s guess, but change is almost certain. The current outsourcing model that so many companies have embraced over the years, will change as cloud computing widens its footprint. The way companies build and deploy applications will change, as mobile apps and app stores shift from the consumer world to the enterprise. The way companies interact and communicate with all stakeholders will change, as social media evolves to social business.