I have led transformation projects for 20 years. Across most industries. From the start of the Internet and the WWW to today’s digital disruption. And each era between.
They all hold one thing in common. New technology. Which drives new behaviour. Which leads to change.
Each new technology attracts its early evangelists. Doom and gloom are upon us unless we adopt the new technology immediately. In the early 2000’s aggressive software vendors proclaimed e-commerce was essential to survival. But only today, 15 years later, is it becoming true.
Apps are another good example. A couple of years ago they were deemed important as they heralded a new era of process mobilisation.
Today the business app economy is decreasing because apps limit the customer experience. And not everyone wants their device cluttered with apps. Whereas e-commerce took 15 years to mature, apps only took 4-5 years.
And what does this mean to the digital disruption? How critical is it? Or is it another slow-burn that will take five years to come true?
I gave a keynote at the World Disrupt Forum in Sydney in August. The keynote that stood out to me was presented by the Australian retailer iconic.com.au. They have designed and built a digital business from the ground up. Connecting analytics with customer journeys to create a compelling, multi-channel customer experience.
This creates a sustainable competitive advantage. I have launched successful online retailers and know the power of an agile operating model and platform. And the disadvantage of running many different systems.
To me, this sums up the challenge of the digital disruption. And how critical it is. Or perhaps more apt: how different it is.
But how is it different? What makes a new economy business like iconic.com.au, Uber and AirBNB flourish?
Because they think different. Anyone can copy what they do. But not how they think. And this holds the key to their success.
The starting point is not the business you have right now, but the business you want to create if there were no barriers. By asking the question: how does my business need to look like to thrive in change and disruption?
One thing it is not. It is not like the current business. It is not about digitising more of what is being done. It is not about running faster. It is about re-imagining and re-designing the business to be agile enough to operate in insane change and disruption.
What does that organisation look like?
It takes advantage of the full potential of digital:
- Speed. How fast a process can run. This has been the preoccupation since computers became commonplace.
- Scale. How fast a process can change and collaborate with other processes. The need for scale is a new phenomenon and connected to the emerging ecosystem economy.
The problem in most businesses is the lack of ability to scale. This is a consequence of a continued focus on speed and automation. But over time it left businesses with many disintegrated systems with tightly integrated business processes. Non-agile and hard to change.
But why is scalability so important suddenly?
Because it provides growth at near zero cost. Scalability is about leveraging an ecosystem or network to create multipliers. In the analogue world, the ratio is 1:1 but in the digital world, it can reach 1000:1.
Yet to achieve and sustain such a ratio requires an agile enterprise platform, purpose-built for the digital world and economy. This is different to enterprise systems that are designed to meet internal capability requirements.
Guiding principles for developing and sustaining an enterprise platform include:
- Single source of truth. Core information is continuously updated and normalised.
- Customer value. Customer value propositions are clear and continuously updated.
- Continuous simplification and transformation. Core processes are continuously reviewed, challenged and decomposed.
- Narrow coupling of processes and system components. Multiple vendors preferred. Single technology or vendor dependence to be avoided.
- Interoperability. Processes and system components can easily interoperate with other internal and external processes and systems via API’s.
This is different from the old challenges of picking a new system to solve a problem. Because this time there is no new system to pick. Indeed, the system is not part of the solution, it is part of the problem.
Get in touch if you have any questions or thoughts on the matter!
He is a published author of two books on transformation. Both are available on Amazon.
- ON PURPOSE – The Path to Extraordinary Business Transformation.
- FROM ORDINARY TO EXTRAORDINARY – How to Re-Imagine Yourself and Re-Define what is Possible.
Jesper is Swedish and apologises for any Swenglish creeping into his writing.
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