Enterprise digitalization, the new reign of User Experience Management the Uberization of services… these are but a few of the trending topics of 2015.
Because trends, services, consumption, production, communication are all disrupted by new technologies and especially by the new uses they have brought about
Music has changed. We no longer buy records. Apple revolutionized the music industry with the iPod and iTunes. Music has dematerialized, the way we consume it has changed. Temporarily.
Then new players emerged — such as Deezer or Spotify — and they disrupted Apple’s business model.
Today we listen to music on demand, with unlimited subscriptions.
We still hail taxis, but ride-sharing services (Uber, Lyft, etc.) have been gaining ground.
Now hotel owners shudder at THE guide, TripAdvisor, and at their newest competitors, AirBnB.
In short, times are changing, and uses too.
And what about companies? How can they benefit from these changes?
Or rather, in what ways should they leverage, anticipate or even cause these changes to avoid losing business to more agile, more innovative competitors?
What Companies Are Affected?
Affected companies include, obviously, enterprises that interact directly with their users; companies that have long been engaged in remote customer relationships: banks (“I manage my accounts online”), telecommunications operators (“I check my call history online, I upgrade my mobile…”) and of course the retail industry with its galaxy of e-commerce sites.
And transportation, too (“I book my train ticket from my mobile, I top up my travel card online…”).
And the travel and hospitality industries…
In fact, very few industries are left untouched and able to escape such changes.
The public sector? To varying extents depending on their funding levels, they keep offering more digital services.
Healthcare? It was one of the latest sectors to join the party, but connected objects for personal health are going to quickly (and very strongly) push this sector toward revolutionizing itself.
And what about B2B? Businesses selling their products or services through distributors must find ways to engage with their consumers or end users. Social networks are one of the answers, and more solutions are being built right now.
Energy? Business services? B2B or not, buyers use — in their personal practices — all the latest, trendiest tools. For this reason, they cannot adopt an “old-school” behavior when they use the professional applications they are presented with.
Why Is It Important?
The younger generations now entering the job market have different service consumption and purchasing habits compared to those who have been defining and operating them for decades.
New uses include:
- I am always connected;
- I want to be able to access the services or products I have purchased or rented (or exchanged…) instantly;
- I am often on the go;
- I am volatile, my brand loyalty is not as strong as my need to be heard, recognized, understood and respected.
Enterprises that fail to embrace these new uses will — gradually at best and suddenly at worst — lose market shares to newer, more agile companies with a truly customer-centric approach.
Why Is It Complicated?
A 2014 survey of thousands of global CIOs conducted by a major vendor revealed that their business information systems were 20 years old in average.
Which means these systems were designed and implemented in 1994.
Back then, the Internet existed but its use was not widespread. Internet subscription packages for consumers, such as Aol or CompuServe, were still in their infancy.
Back then, we rarely made calls on the go — and when we did, it was from a car phone. When out on the streets, we had to stand near a base station.
Back then, there was no WiFi, no access to any kind of data while away from home.
Today these very systems are being used to solve problems that they were never designed to deal with — whether by the vendors of the time or by the companies that installed them.
Many applications were developed on top of these systems. Then migrations, customizations and all kinds of system extensions made them increasingly complex to use and scale up. And usually, they still don’t address these new challenges.
What Is the Recipe for Success?
So, concretely, what can be done to avoid declaring bankruptcy while any new start-up venture with none of this burdensome legacy, and with an innovative approach from the very start, is thriving?
Enterprises that have developed a brand image, designed innovative products and services and, if need be, rolled out a distribution network, have a very strong capital.
We think that there are a few essential steps that can be followed to make the move towards a technological future that is in line with current uses.
Step 1: The Business/IT Alliance
Ever since the first email campaigns were launched, there has been an increasing separation between business management teams (in search of autonomy) and CIOs (in search of urbanization and centralization). In this new use context, these two departments and their related organizations must come together and work collaboratively to develop their future technology landscape, the one that will successfully adress new product and service consumption patterns.
Step 2: Setting Up Repositories
Applications that have been developed by either the Business or IT department over the past 20 years have generalized scattered, compartmentalized application silos. As a result, single repositories are a rarity: prospects and customers, products and services, purchases and sales, retail outlets, special offers…
Mobile uses will require data consistency across all distribution channels: “I place an order from my smartphone, I collect my purchase in store, I visit the brand’s website to learn more about an optional accessory, then I reach their call center to order it… now I wouldn’t understand it if I was presented with differing information, a conflicting message or mismatched prices from one touch point to another; and of course I don’t want to tell the call center what I have just bought, I already gave them my name and that seems more than enough information to retrieve my last order within seconds.”
In a few words, these repositories are the cornerstone around which new applications should be built so as to ensure that these new customer expectations are fulfilled.
Step 3: Application Replatforming
Using social networks efficiently, knowing/understanding/controlling prospect and customer behavior, and finally making products and content available across all existing channels while providing a way to purchase or consume them in a natural way: these are the challenges of digitalization that must be factored in when reviewing new services and when considering the acquisition and implementation process of new applications.
Digital transformation is a long and complex process. It must be started without delay and achieved in stages, by conducting a thorough examination of the opportunity to rethink organizational design, keeping in mind a great ambitious objective and successively deploying the reference pillars that will underlie and support the company’s structural change.