Let me start with an inconvenient truth – technology does not deliver business benefits. Business benefits accrue only through business changes by infusing technology into core business processes, workflows, and customer journeys to optimise operations and decision making.
The hype around digital transformation, hence, will seemingly appear overdone, recognising that many of the milestones today are rather combinations, re-combinations, and applications of the past decades of breakthroughs.
Buffeted by such modern-day trends as the Cloud, Internet of Things (IoT), Machine Learning (ML), Artificial Intelligence (AI), Robotics Process Automation (RPA), Blockchain technology, Big Data and Analytics etc albeit disruptive in nature, nevertheless, they pale in comparison to the impact of the inventions of the General Purpose Technologies (GPTs) of the 18th and 19th centuries – electricity, steam engine and the computer/Internet – all game changers that extended their reach into many frontiers of the economy and dramatically altered the way and manner in which we live and work.
While industry boundaries and traditional lines are blurring – retailers becoming tech companies and tech companies becoming Financial Service Providers (FSPs) – with customers across all verticals becoming demanding as their needs evolve and new entrants challenge incumbents by raising expectations with new services, the fundamental rules of the game have not changed but what we must do to win in today’s digital ecosystem has!
Expectedly, technologists often get too enamoured by the instrumental aspects of technology and revel in the complexities of shiny new objects. But strip the digital fashionistas of their hype and focus on the help and we realise that it is still same same – customer centricity, improving effectiveness of decision making, growth, market share, profitability, becoming more socially and environmentally responsible etc
Learning from experience, therefore, is a most important aspect of strategic management. And, if there is an overall lesson that business experience of the last couple of decades has taught us, it is that new technologies continually come and go and the pursuit of opportunities through digital technologies must be driven not only by what is technologically feasible but by what is strategically desirable and economically viable.
Here are my other two picks of learnings from experience:
- Capability does not equal value – history finds a way of repeating itself as we seem to have forgotten too soon the tragedies of the dot.com bubble – the rapid technological advances of the mid 90’s when all comers started exploring the boundless frontiers of the internet and caught the attention of hordes of speculative investors. A wave of new internet companies sprang up with all sorts of unproven value propositions and skyrocketed stock prices while the companies had no real chance of making money in the long run. As time went on, more and more investors jumped on the bandwagon to fund new internet companies as they watched the huge successes of those that had pulled off successful Initial Public Offers (IPOs). With the euphoria of the successes, caution was thrown to the wind as more and more people looking to cash in on the emerging opportunities dived in headlong. As 1999 changed to 2000 and the Y2k computer programming bug that was expected to cause widespread havoc to many systems passed largely unnoticed, the bubble busted, and a host of the internet companies with no customers and no revenues and provided no efficiencies by being online folded up. The key takeaways from this: we must respect what already works and only deploy technology where it does really make a difference. Do not buy into the hype, separate the help from the hype. The fact that something can be done technically speaking does not mean that there is any value in it. It is the end user utility that COUNTs and not the bells and whistles of the underlying technology.
- Thoughtless reliance on technology is a liability and not an asset. The wide difference in economic benefits that organisations gain from investments in technology rests not in technical difference but in management difference. Technology needs to be linked to a simple, clear, and coherent concept that reflects understanding for it to become an essential driver in accelerating forward momentum. In our new era, processes trump products – products will become processes and services.
Overall, enterprises must embrace digital transformation as an evolutionary process. Technology fulfils a strategic role in almost every business today – business processes are increasingly dependent on technology, products and services have become more digital and distribution channels are more electronic.
Therefore, to remain relevant and thrive, every enterprise must develop and maintain a high level of competence in how it manages and leverages contemporary technology.
