Every business and its leadership needs to pay adequate attention to the inevitable phenomenon of digital. There is no escaping, the only choice is when do they seriously consider it a game changer, and act accordingly. The digital onslaught is not limited to one or few industries, but more and more industries shall see the emergence of digital disruptors, forcing the incumbents to act or perish.
I have been observing the phenomenon very closely as a part of my research and consulting work. I find three strong waves that require business leaders to focus their attention on exploring how digital can be explored and exploited strategically.
1. Challenging growth environment
The world is passing through a difficult growth phase. With economies across the globe recovering from the pangs of excessive growth and resulting anomalies of the past decade, individual businesses are finding the going tough. If we take the case of India, the growth engines of the past decade, banking, telecom and IT/ ITeS sectors are all reeling under the pain of low growth. Automobile is somehow holding on, but has become enormously competitive. Retail is impacted by the rise of eCommerce players, who of course are burning enormous amounts of cash to grow. Similarly, many other industries like media and entertainment, financial services, insurance, aviation and FMCG too are finding growth difficult.
Environment has become extremely disruptive. Take the case of demonetization or GST roll out, businesses are required to become agile and efficient. The growth challenge is further enhanced by the digital disruption that is giving consumers multiple choices and creating new business models. Amid moderating growth, price pressures and increasing costs, businesses have no option then to explore ways to innovate products/ services and delivery, and reduce costs by becoming more efficient.
2. Growing pile of data
Many of the industries mentioned earlier have been using IT for many years now. They have built enterprises systems covering the core operations, customer relations and supplier management. The ERPs, CRMs and SCMs today sit on huge pile of transactional data that is increasing in volume, variety and velocity. This is further fuelled by adoption of operational technologies in industries such as manufacturing, mining and metals, and oil and gas that are also getting integrated with their IT systems. Modern technologies such as Internet of Things, mobile apps, social media are further creating engagements of people and machines that is adding on to the data pile. For years, this pile of data has remained unutilized and unused. Against the back drop of growth difficulties and margin pressures, insights from the data pile for insights into efficiency and effectiveness can be very useful.
3. Emerging technologies
Though touched upon in the earlier point, the emerging technologies deserve a special mention. Machine learning, cognitive technologies, speech recognition, smart grids, nanotechnology, advanced sensors etc. are the emerging technologies that shall usher us into innovative ways to weave people, things and processes together. They shall also create lot of data that has the potential to drive smartness into products, processes and people.
The three imperatives speak about a context that demands agility and efficiency, availability of data to identify patterns and emergence of modern technologies that shall enable businesses to become agile and efficient. A simultaneous rise of the three imperatives demand that businesses do not treat digital as a tactical issue and simply flirt with it, rather they work seriously towards aligning it with the core growth strategy of the business.