Step back and think about the relationship between business and technology. Transformational or disruptive ideas seem to come in co-dependent pairs. Business ideas give shape to these ideas providing the why and what. Technology innovations turn shape into substance through answering questions about when and how. Independently each generates marketing buzz, points of view, and academic research influencing decisions. When the two come together, however, they define a trend that resets strategies, directions and investments.
Together we can change the world
Technology innovations seem to evolve in parallel with business ideas or innovations. Which comes first is a matter for debate. Regardless of who comes first, we can agree that technology/business pairings have been around for a long time. Mainframe computers gave rise to the modern organization with administrative staff, business functions and management by objectives. Likewise business process re-engineering provided the business rationale for investments in client-server technology that supported rightsizing and process oriented organizations. The direct customer connectivity provided by the Internet required ecommerce thinking to change the world.
Transformative pairs involve more than defining the applications connected to specific technologies. Pairings need to reflect a change in direction or essence of business ideas and strategies. The path to hype and disillusionment is paved with simple definitions of business applications of new technologies. Just look at early waves of CRM, analytics, cloud, ERP etc., and you can see what happens when the business idea is insufficient to carry the capabilities of new technology.
A robust pairing of transformative business and technology ideas goes beyond new rounds of automating past processes and activities. Robust pairings drive new business thinking and action around strategy, products, organization structures, operating models, performance measures and targets, management structures and executive roles. Likewise new technology thinking manifests itself in new technology products, services, sourcing arrangements, partnerships, application classes, infrastructures and architectures. Cynics see this list as tailor-made by consultants and service providers, but realists recognize that meaningful change requires covering these and other elements.
What goes well with digital?
Digital technologies are transformative, no doubt. Mobility, social, big data, cloud, sensors, etc., provide new “how-to’s” that are happening now. The challenge is in defining the “why’s” that justify business and technology transformation. At one level you can say there are multiple pairings between individual digital technologies and business transformative ideas.
Mobility enables customers and business at the edge by information and process on mobile devices.
Analytics technologies are set to transform the nature and pace of management decisions.
Social media technologies have redefined marketing, branding, politics and relationships.
Cloud provides the capacity and cost savings to drive new products and services.
Such one-to-one pairings are powerful. They may drive individual digital initiaitives, but too often they represent individual changes. They represent individual fingers rather than the value that is in your hands.
Just like a powerful entrée requires pairing with an equally powerful wine, the collective transformative power of digital technologies demands more than different versions of digitizing operations. It demands matching digital technical capacity with an equally powerful business idea.
Right now it is an open market calling for transformation and innovation, but transformation and innovation of what and to what end? The paired business idea will answer these questions.
Currently multiple candidates vie to be the next Internet – ecommerce or BPRE – Client Server pairing. These candidates form the basis for the current wave of business and technology books falling into the following camps:
Customer centering on ideas such as consumerization, customer centricity, customer experience, customer interaction, digital marketing, co-creation, and service design.
Economic and market structures forms another camp as digital supports ideas such as democratization, sustainability, reciprocity/sharing, meritocracy, value networks, the lean start-up, over the top, etc.
Information is a camp defined by big data, analytics, N=ALL, the idea that we will know everything, everyone, everywhere, instrumentation, information based products and services. Are there others? Probably and it would be great to get your thoughts and contributions in the comments. But one thing is clear there is as of yet no widely accepted business idea paired with digital technology. How can I be sure? Well because there is no “ERP” for digital, yet. There may never be and that might be the right answer. Each camp carries its own strengths, attractiveness, challenges and limitations.
Digital is a big set of technologies that have the ability to change everything. That creates a wide playing field for business and technology innovation. But if history is a guide, a pairing will emerge as a way of thinking, modeling and managing the transformative value of digital technology.
Sorry this post contains no answers, only observations. I welcome yours. Please share your comments.