Customer centricity, AI, automation, agility: These buzz words saturate all CIO forums today, and meanwhile every IT organization is under immense pressure to deliver some level of innovation with the hot-topic technologies.
The key concept not usually mentioned explicitly, is the future of enterprise. In this new era in which everyone is talking about the digital approach and how to sell services or products without investing in manufacturing or assets, with a technology framework or hub you can connect customers to sellers and profit from it. Obviously there are well known examples, such as AirBnB and Uber, but take a company like RentHop, which created a platform to search for apartments, and is creating value for New York landlords and renters.
Old vs. New Technology
Despite the countless media and entertainment options available today from your TV, smartphone or tablet, AM/FM radio continue to be the top source of weekly reach according to this Nielsen report. This is especially so, because users continue to tune in during their road trips and daily work commute.
This is an example of how an old technology / business models plays an important role and needs to be strategized, rather than just jumping in to a new one. At this point, I hope you’re thinking, ‘how can we use this analogy at my company?’
The future of the enterprise will be a mix of old business models and new approaches to current issues, in addition to customer visibility. The enterprise of the future will be based on 3 pillars:
- Improved Core: The speed for M&A or creating new products or services or even keeping the same products has been sequential delivered to the customers. Look at Tesla, for example, where Elon Musk promised 5,000 units a week in their new Giga Factory and in delivering just 2,000 made their shares drop at beginning of 2018. The innovation of their products is unquestionable but their ability to deliver on time and consistently is now being questioned.
The for most business leaders, focusing exclusively on innovation without regard to improving the core is the start to the process of nailing your own coffin -- in 5 to 10 years the competition will pass you by.
- Connectivity: Business frameworks, digitally connected and specialized services, will be in place. A well performed company will not be the company that delivers innovation or new services, but the enterprise that will be well connected with their environment, suppliers, customers and employees in a unique platform, connecting all needs to support the company’s vision. The company that fails to connect all the dots (employees, customers, society, suppliers, shareholders) will struggle. (Again -sorry Musk-, a specific example from Tesla).
- Digital Arms: Digital adoption, self-services approach and the new generation of customers and employees will force the enterprise to be thinking about their services and employees’ relations. A digital vision will be in place and new arms and appendices that comply with the old business models will be key to creating an immersive interaction with customers and the new business chain. The newest literacy talks a lot about the customer journey and how the individual path to consume a service or product—the “experience” — is the gold mine of the 21st century. In fact, the new enterprise should be able to digitally interact with your customer and “physically” deliver their products (Remember Tesla).
Be Prepared for the Future of the Enterprise
Digital Transformation Framework: A digital transformation framework is a foundation for the organization transformation and how to prioritize the efforts and investment to support a unique future vision. Rethink your actual transformation and reshape your organization based on how your company will be positioned in their 3 future pillars (Improved Core, Connectivity, Digital Arms).
Core Platform: To achieve this future vision of the enterprise, a modern core platform or an ERP that combines old and proven scenarios with the newest approaches of IoT, AI and customer centricity, is essential. Gartner illustrates the concept of postmodern ERP well, defining two categories of ERP strategy: 1) Administrative, which focuses on financial, HCM and indirect procurement; and 2) Operational, which focuses on manufacturing and distribution.
Agility: Act fast, a Forbes statement from 2015 predicted: “By 2018, 67% of CEO of Global 2000 companies will have digital transformation at the center of their strategies.” Today, all companies are scurrying around to be at their digital “being,” but a lot of them are struggling and slow-moving due to inner pressures, government or lack of strategic vision.