Digitization is re writing the rules of companies, with traditional companies at risk of being left behind.
So much so that the head of digital at RBS says that ‘the impact of technologies and algorithms to target offerings for SME’s is creating a transition in business that occurs once every 100 years’.
Digitization often lowers the entry barriers, causing long established companies to tumble which creates an opening for focussed, fast moving competitors. New market entrants can scale up rapidly at lower costs than legacy businesses.
At the Business Exposure Group meeting many attendees felt that they were being forced into adopting technologies that they felt were out of their personal reach. To become confident, in an ever changing market place, the solution was to bolt on a technology capability, by either employing strategic techies or having a technology business running alongside the core business.
This discussion led the group to consider whether they felt threatened by the power of these technical employees. Knowledge roles within companies are being eroded by computers able to analyse data more reliably than managers, hence it is necessary to budget to spend money on finding the digital players who can setup these systems.
60% of the attendees put technology at the heart of their business efforts, but most thought that they were making hard work for themselves by not spending enough time analysing properly what customers require. Not enough research was being carried out, companies were acting on gut instinct, whereas with technology, algorithms and hidden micro files a more personalised and real-time targeting of customers can be implemented, which brings back the personal service of old.
A digital strategy, in a few years’ time, will become a business as usual strategy, and as a final thought if a business does not embrace this way of working, now maybe the time to sell up, because some businesses will become less attractive in a digital world.
Food for thought!