Recently I was reading that up to now, each digital technology change was a separate era but today we are facing something seemingly different, a collision, a whole mash-up of disparate technologies and systems, that seem to be heading for such an explosion of change, a post-digital transformation.
This merging of cloud, big data, social, and the internet of things is becoming the new system of discovery according to some. Others call it the crossroads where the post-digital reality of bringing together the cloud, mobile, interconnected devices, data analytics and embedded intelligence are pointing us to a hyper-connected world, less tomorrow, more speeding towards us in the here and now.
It is through people and things (IoT) we will get new innovation potential
It is through people and ‘things’ (machines and devices) that we will obtain increasing and more powerful insights, that have the real potential of being turned into new innovation potential through the connected businesses. This can generate new value and business propositions.
It is this “turning into new innovation” is where I have my current difficulties. The virtual world of digital is moving much faster than the physical ‘enacted world,’ of turning insights into actual innovation activities, through the innovation pipeline.
The whole discovery to final execution is for most organizations still, a very fragmented, often disconnected system, highly reliant on people to make decisions and organize the more tangible finished result. It is still through mainly a linear process of stage-gates and investigation /validation / move on or not. I can’t see that working in a digital hyper world where insights flood into the innovation engine room, expecting the same ‘hyper’ response and delivery result.
The ‘play’ at present is how all this represents such significant business opportunities for both the large and start-ups alike and how they set about it. There is a real hype and force behind this but until we fix the total innovation value chain, the (new) front end for all these digital insights flowing in, otherwise it will just simply increase the log jam and the significant frustrations will grow even more that innovation is not matching its potential.
Something will have to give or change and needs fixing to be better equipped for this digital transformation of real-time insights and opportunities.
There is significant increased capital and funding going into these technology changes, not the innovation process
Recently IBM was reporting how the VC is funding much of the ‘edge of embedded systems, different gateways of connectivity, messaging and the much-needed security all this means. Equally how the VC is investing heavily in the back-end of cloud services where data services, analytic services and (again) security need different solutions to meet these changing times.
Then we have the leaders in the shape of Amazon, Google, Salesforce and a number of others all-seeing significant ramp ups in engagement. Also this is equally coming from the likes of industrial giants like GE, in their connected world and many, many others, all determined to shape their industry and change its boundaries, through offering broader system products that pull together these technologies and shift the customer value proposition in radical ways.
There are sizeable bets and large sums of new capital going into this front end of discovery.
We are transcending traditional industry and product boundaries
The transformation that is under-way is exciting, actually scary and highly challenging in significant ways. Like in any “wild west” environment advice comes from every quarter, stories feed of each other and magnify but heroes are born or in this case, are created, for this convergence of post digital evolution.
This is the time we are blurring or having so many things flashing before our eyes with the digital and physical worlds combining for this convergence of people, business and things.
The dizzy array of strategic choices will totally disrupt existing business models if they are right in their design. The whole world of communicating, transacting and designing all the different negotiations and products that meet the immediate needs of the customer makes this the “digital business era”, where constant redesigning and orchestrating the parts will keep it at the forefront by a constant evolving set of combinations and leveraging a network of diverse capabilities.
It will be how and where a business or entities of business come together and see where ‘people, things and their business offering’ can come together for mutual value based on the unique combinations of the different technologies available.
There will be a constant evaluation of the assets both internal and externally that make up this digital world (people, the business and things) that will take this out beyond the control of one company, into a system within a larger system to make it work at a constantly evolving speed and gain adoption.
Who will master all the necessary interactions?
The decisions being made will define markets and push way beyond established industrial boundaries to seek out and attract, to acquire both data and sales and keep retaining customers, who will increasingly become more fickle, unless they ‘see’ the changes and the values being offered.
This is going to have a real velocity to it. In our homes, in our personal lives, in connected transport, in our cities, in a multitude of our industries and health care systems, in our shopping, in the way we can buy and engage with the source of our need. None of this will come overnight but it is going on all around us in improved response times, connections and choices.
As the organizations investing in this changing world learn about people, different business approaches and structures and what these ‘things’ are capable of it is the knowledge gained and translated represents a new world of possibility.
Much will become even more highly transitory
I was going back through Rita McGrath’s book “the end of competitive advantage” and although this only came out in late 2013, I realize it does seem to be lacking in much of the change taking place through this new emerging digital era. Yet it does paint a changing world, it does offer many pointers to understand and filter a new thinking through.
Rita discusses “arenas” that are transcending current industry boundaries where organizations ‘spot’ opportunities and look at what needs to fill the space, by pooling and orchestrating different assets to go after that opportunity. A different game is opening up.
Yet digital thinking is transformative and does take us into a different business dimensions, one that can offer greater transparency, connectivity and the need to respond in dramatically different ways than our past business models were capable too. We look out in broader ways.
Those that seize this opportunity will look towards shrinking market cycles, delivering totally different value propositions, seizing vacant space where better job- can-be-done. These will be further exploited through combining technology, social and marketing solutions that explore different innovation offerings, ones that customers will decide (or not) do meet either their needs or unexpected needs.
Some innovations or value propositions will take them for a real surprise, as they were totally unaware of these, yet they seem to fit into their ‘perceived’ lifestyles and activities, captured more and more through these SMART devices, many of these will offer new premium value price points for business or customers.
The reality is fast becoming our ‘advantage’ will be highly transitory as competition will be seeking all possible ways to match your offer. Shorter cycle times, constant change and update will be the point to chase the value and keep the interest, otherwise others will nip in and steal the ‘advantage’.
The reduced lag time of everything perhaps?
The lag time of everything will dramatically reduce. Be these traditional industry cycles, product development, and customer feedback as the battlefield will be staying constantly ahead of the competitors response through this constant investment and re-engineering of the different combinations of new transient competitive advantage.
A world of rapid testing, experimenting, test and learn cycles, the increasing use of 3D printing, exploring different configurations that resonate or not with customers, so they can be quickly scaled up and delivered as the advantage point.
Digital technologies in their different forms will establish new terms of customer and competition advantage, where the whole cycle spins faster, latency constantly gets destroyed and organizations seem to increase their velocity to simply stay ahead.
If we do begin to believe all of this, the new channels will be digital where products, services and experiences will alter in ways it is hard to image today, although I’m sure they are being worked upon by the next wave of digital / business smart organizations searching to be the next Amazon, Google or GE.
Converting theory into reality that drives increased growth and revenue
The game is presently to convert the theory, the numerous ideas coming from all these digital insights and interactions, into concrete reality and we will have a real difficulty for most on this to convert these quickly enough. Many opportunities might be simply transitory but highly valuable to exploit.
It is not what is coming through our door, it is what we are able to get out of the door at the other end. Most of the innovation systems are designed from a very physical engagement, validation and execution perspective, operating not at any speed like or what we are wanting to get out of all the front end investments from the new digital era.
There will be systems and practices at real odds in speed, agility and decision-making. This will hold any evolution up, until the back end of product, service or business model are equally addressed. This does need the same commitment of funding and strategic thinking and organization engagement or this post-digital era will fail to deliver, due to these up-stream constraints and antiquated approaches to the innovation system.
Digital disruption is with us, it seems to be enormous in its potential transforming effects. It has an enormous potential to alter how a business conducts itself; in seeking out its different (and multiple) value propositions, the design of its new business models in the way it engages with people, things and its business. Yet I have to ask about the physical innovation value creating capacity – can it cope?
I’ve just got one enormous headache thinking about it.
Innovation will certainly not get any easier; it will be faster, more demanding and a heck of a lot more risky. The innovation systems we presently have will simply not cope, the log jam will not be the data flowing in,it will be the amount of innovation flowing out or more than likely just trickling out.
It does not matter what we rush to invest in digital capabilities something down the value chain will have to be radically altered to seize this digital era and turn ‘seen’ opportunity into reality and that is today based on people’s innovation capabilities.
Innovation still totally relies on people not this digital tsunami or digital monsoon as I called it, that is altering the front end. I understand most working within our organizations are lacking engagement, will they welcome the digital age or it will become even more the whipping boy, being forced upon them of reluctant change? The digital front end is going to hit a real roadblock within organizations that needs addressing.
Innovation remains stuck in 20th century thinking
How will ‘we’ seize the opportunities and turn them into the innovations that is needed to be delivered to capitalize on the insights gained? I would think we need to invest in the innovation system and structures to enable this to happen and are we?
Today most innovation systems are broken or one paced, mostly fit for incremental innovation only and as latent as you can get, in reaction, inefficiencies and in delivering any concept to final product or service delivery in anything remotely close to real-time or incoming digital response.
The innovation life cycle is not fit for this digital purpose for most organizations. Is anyone thinking of this? This needs equal attention and fixing. As we assemble highly transformational road-maps we might pause and think about the inadequate one we have for the innovation life cycle.
Or am I missing something here?