You won’t understand the impact of new technology before you start using it
In our Business Transformation blog, we have covered parts of our study called “The Future of Business Transformation”. In the study we conducted several C-level roundtable discussions to find out the biggest challenges and opportunities that executives see in business transformation.
In one of the discussions, an executive from a major bank stated: “The reason we do not invest more in transformation is not lack of resources. It’s because we simply don’t know what to invest in”. What could be the reason behind this? One reason suggested in the study could be the lack of ideas as to where investments should be aimed at. Another reason could be the lack of confidence to make new and strategic moves into new, unexplored territories. Executives fear that analysts and investors will not agree with everything that the company board decides to do. But what is more devastating to business than standing still in a world that is changing faster every day.
According to the study, the technologies with the strongest transformative power are: mobile, social, Internet of Things, big data and cloud. Interestingly, 36 per cent of the respondents expect mobile payments to have a major effect on their industry in the near future. But the list goes on and in addition to the top 5 there are several other technologies that will also have a major impact on business in the near future. In the study, the automation of knowledge work was seen as a major opportunity for businesses. Over a third of the respondents saw it to have an impact on their industry. Cognitive computing will have a big impact on all our lives in the coming future. When computers are starting to learn and when they are capable of thinking, it is obvious that this will start to re-shape the role of knowledge workers in the same way as process automation has changed the role of a worker in manufacturing industry. IBM’s Watson is perhaps one of the best-known examples in this area today. Watson has proven that it is really possible to develop computers to assist humans in decision-making and someday even take the decisions on its own. In smaller scale you can already today experience your personal computer assistant on many of the mobile phones (Apple’s Siri, Google’s Google Now, Microsoft’s Cortana). Computers will be very powerful assistants in areas where we have a lot of data to build the decisions on, when it comes to creativity and innovations, I still rely on human beings.
Another interesting fact from our study is that almost half of leaders worry that their company will lose its competitive edge because they are unable to keep up with changes in technology. But even though many executives know that they should invest to keep up with the evolution of business transformation they are not all actually investing or participating in it. So there’s often a gap between knowledge and actions. Strong leaders and a supportive company culture are needed to make bold decisions. The reality is that you won’t understand the impact of new technology before you start using it.
When things are changing fast and new innovators challenge the traditional players and business models on a daily basis, it is not that simple to decide on what actions you should take. In this type of a business environment it is extremely vital that companies keep investing in research and have a clear vision on where their industry is heading, where their customers are heading and what are the most likely disruptions that will impact their business. When thinking on the future scenarios you should not build on what you currently have, but really start from a clean table. If I would start my operations today - how would I do it? Most likely you will find that you would do many things differently. You will properly also notice that the legacy you have been building during the past decades is not optimized to face the challenges of the new paradigm. But after you have built your new future vision, it will be much easier for you to take the needed decisions and start to execute.