Digital Disruption and the Pressing Need for Transformation

An exploration of digital economy and evolution of the modern digital enterprise

World is changing around us. Technological innovation driven by cloud, mobile, social, data and IoT is impacting the way we live, work and play. The pace of technological innovation has increased over the past few years and is accelerating fueled by the innovation created in the digital networks. Current rate of technology innovation is perhaps the most dramatic and disruptive since the industrial revolution. Technologies such as Cloud Computing, Mobility, Internet of Connected Things, Connected Homes and Cars, and Wearables are impacting the way consumers interact with the world around them and this in turn is impacting the very core business models of each business. Consumers in almost all industries are becoming increasing tech savvy and demanding digital solutions from businesses. No organization and business are immune to change any more as changing technologies and consumer behavior are demanding a change and fundamental transformation in how businesses operate in this new normal where change is the only constant.

As digital technologies continue to disrupt every industry, there are only two types of organizations – those that have been reshaped by digital technology, and those that soon will be. New competitors are emerging in every industry and traditional organizations are transforming themselves into digital organizations using Social, Mobile, Analytics, Cloud, Internet of Things (IoT), Artificial Intelligence (AI), Blockchain and more to offer new digital experiences to their customers.  Through digital transformation, organizations can offer products, services and value to customers, patients and citizens that were not even imagined just a few years ago. A truly digital enterprise does more than use new technology – it replaces old operating models with digital models that can be incorporated into product platforms and operations.  Becoming a 21st century digital enterprise requires a strategy that enables continuous delivery of digital capabilities at the speed of the business.

Drivers and Enablers

Digital technologies – Social, Mobile, Analytics, Cloud and Internet of Things (SMACT) – are driving innovation and change across all industries and are acting as technology enablers to move the digital transformation forward. In addition, gigantic shifts in customer behavior caused by economic, cultural and political changes are driving multiple economies across consumer and business segments.

Data Economy – Intelligent Enterprise

Researchers report that more data has been created in the last two years than in all of human history, and market research firm IDC notes in 2014, the digital universe equaled 1.7 megabytes a minute for every person on Earth. IDC predicts the total size of the digital universe will reach 44 zettabytes of data in 2020. Roughly 10 percent of that data will come from 32 billion connected devices—more than twice as many as there are now.With the influx of large amounts of data from multiple traditional and modern channels, advances in processing power, lowering of barriers in processing large data sets, reduction in cost of storage and advances in data science organizations are able to leverage software/machines to help them make more informed decisions. In this deeply data driven model, organizations can readily exploit actionable insights from data to drive better business outcomes across the enterprise.

Experience Economy – Smarter Consumer

Big data analytics combined with the proliferation of mobile and wearable devices are allowing businesses to craft experiences that are unique and personalized to each user.  Personalized, unified User experience across multiple channels (web, mobile, wearables, connected cars, connected homes and other smart objects) is key to engage consumers and gain competitive advantage.

All types of businesses, not just technology companies are using personalization to provide context rich experiences to the consumer. This means all features and functionality built into any product must reflect what individuals are trying to accomplish, enabling them to control and automate parts of their lives in both physical and digital worlds. Customer demand for outcome based, personalized, integrated experience is driving innovation towards solutions than products. Organizations can gain quantifiable, end to end insights into the outcomes their customers are trying to achieve and use those insights to develop significantly more effective solutions.

Mobile Economy – Ubiquitous Computing

It is estimated that 50 billion devices connected to the internet by 2020 (source:Cisco) with a total potential economic impact in the order of $4Trillion to $14 Trillion across all industries by 2025 (Source: McKinsey, Cisco).  Internet of Connected Things has the potential to fundamentally shift the way we interact with our surroundings. The ability to monitor and manage objects in the physical world electronically makes it possible to bring data-driven decision making to new realms of human activity—to optimize the performance of systems and processes, save time for people and businesses, and improve quality of life.

With 5.2B mobile users across the world (source:Internet Trends 2015,, Mobile has become the new de-facto access point and combined with Cloud computing has led to true ubiquitous computing.  The processing power of the average smartphone has increased by about 25 percent per year over the past five years, and the latest processors can adeptly juggle multiple resource-intensive applications and produce vivid graphics.  The mobile Internet is also being offered in entirely new formats, such as wearable devices.  In coming years, mobile Internet devices will be smaller, far more powerful, more intuitive, wearable, and packed with many types of sensors.

API and App Economy – Software Driven Organization

Software is eating the world and every business is being forced to become a software business. As more products become smart and connected, software is emerging as the connective tissue for value creation, even for companies that sell physical goods. Intelligent applications are a playing critical role in driving business decisions across all types of businesses influencing how these businesses interact with their customers, how they buy and sell products or services and how they find their next product insights.

Furthermore, innovations in technologies such as Machine Learning, Natural Language Processing, and Cognitive Computing are changing the way consumer and enterprise software is developed. These technologies, in conjunction with new user interface formats such as gesture, touch and voice, are opening a new world of possibilities for software developers.  Modern software is smarter, connected, mobile-friendly, cloud operated, social aware, API based and user focused.

However, to compete with agility and speed, companies can no longer afford complex, lengthy and expensive coding of applications, or massive, multi-year system implementations. What’s needed is a new way to build software—faster, flexible and more agile—with reusable components that allow for rapid assembly of applications in support of dynamic business needs. This approach requires an Agile approach to development, DevOps culture, modular and micro-service based architectures, next-generation integration techniques and a cloud-first, mobile-first and API-first mindset.

The Next Generation Organization – Agile, Data-Driven and Powered by Software

We believe that in order to get ahead in todays hyper-connected digital world, every business needs to become a digital business with the appropriate tools, processes, mechanisms and digital channels in place to reach the customer, all aligned to a business strategy focused on customer experience and agility.  All layers of a traditional business including marketing, management, employee engagement, customer acquisition, infrastructure, must be evaluated and transformed to meet the challenges of the digital world.  The traditional approach of let’s define a “target state” and create a “roadmap” to get there does not work any more. Organizations need a transformation strategy that is rooted in incremental, iterative, agile transformation with a firm focus on measurable results – the “target state” will continue to evolve influenced by changing business conditions, customer behavior and technological innovation.  An ideal transformation effort will consider all these factors and lay out a roadmap that addresses the question – “where do I start and how do I become agile enough to be able to react to changing market conditions”.

The principles of integrated customer experience, agility, transparency and collaborative culture, combined with an approach that provides measurable progress through innovation, prototypes and continuous delivery will enable organizations to re-design business models, re-imagine user experiences and evolve into digital businesses. Furthermore, organizations need a partner that can bring together the creative and technology capabilities, business acumen, and industry insight needed to transform the organization into a 21st century digital business.

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