Scene setting
Think back to the '90s when businesses first became excited about social media, mobile, data analytics, and the cloud (SMAC). It took a good decade or more for these to truly deliver, leading to a sense of early-stage hype and later-stage despondency. Fast forward to today, we're facing another wave of game-changers like Generative AI, Immersive Technologies, and Decentralised Autonomous Organisations (DAO); with the potential to be even more disruptive to our current business models and IT operations.
What were the main issues facing the delegates?
One of the most common concerns among attendees was how ready their organisations were to embrace these new technologies. The obstacles to innovation ranged from cultural resistance to the burden of legacy processes and systems. For instance, we heard in construction, automotive and healthcare that data governance is a prerequisite for applying new techniques such as generative AI.
All our delegates agreed that emerging technologies and the innovation they bring are essential to tackling today's business problems and open up opportunities for the future – for example, the launch of virtual hospitals for elevating patient care or the potential for self-driving vehicles.
One crucial factor for success is educating the organisation so they fully understand the potential of new technologies and can undertake a realistic assessment of the value they bring versus the associated business risks.
What can we learn from past experiences?
Everyone recognised the profound changes induced by SMAC technologies and e-commerce over the past two decades. Most have made the shift to the cloud for scalability and agility, and they've embraced mobile apps for both internal and external use. But here's the catch: old legacy systems are still holding back progress. The need to "clean house" before experimenting with new techniques is paramount to realising true value.
The key to successful innovation over the years has been a focus on business problems and the needs of customers. The impact of digital on the outside world is clear, with shifts to e-channels the norm in everything from shopping to government services and online banking. Designing organisations around the ‘digital voice of the customer’ has helped break down cultural and organisational barriers.
Are we reaching a pivot point?
Many of our delegates talked about the shifts happening in their business models and operations and the profound impact of these changes in the coming years. The takeaway is that organisations must reevaluate their core activities to adapt to the digital trends among their customers. This is especially true for traditional manufacturers who need to focus on solutions rather than just products. For example, new solutions are required to better support ageing populations in Pharma and Health.
Our discussion delved into risk mitigation, with CIOs and CTOs becoming increasingly involved in shaping and executing business strategies as digital technologies become business fundamentals. There was a question about whether boards are ready for these fundamental shifts in their organisations.
So, how ambitious are organisations?
In leveraging digital innovations, we considered two scenarios to test organisations' ambitions: modernising the existing setup by automating and innovating processes or launching startups that incorporate digital business models and architectures. 70-80% of attendees recognised that major business investments need to focus on modernisation, primarily reducing legacy systems and removing organisational silos.
However, the idea of testing new techniques in startup environments, which bypass cultural or legacy issues, as interesting for validating proof of concepts. Companies may need to wear two hats – one as traditional managers and the other as venture capitalists. This is already being realised in the automotive sector, with a preference for new, green-field manufacturing approach in response to Tesla and electric vehicles. Even the UK's HS2 project has called on the construction industry to abandon old practices and embrace new ones.
And so to the future
It’s clear that genuine innovation will not be achieved through internal discussion alone. But with end customers now digitally literate – and often ahead of vendors – we need to put the failed experimentation of the ‘90s behind us. Successful innovations will engage customers from the outset instead of halfway through a transformation journey; a significant shift for research and development processes.
Understanding the consumer has become the most effective way to innovate. John (GoogleCloud) described the concept of “micro-moments” to track market behaviours and the role of the persona in modern marketing. This combined with consumer data provides fresh insights into the behaviours and needs of customers.
What are the actions to be taken?
Phil (Cognizant) wrapped up the evening with three points for accelerating innovation and reducing the risk of failure:
- Get CIOs actively involved in strategic and operational discussions to understand the business's pain points.
- Make sure CIOs work on solutions that cover all aspects of change, not just the technical aspects. Culture, people and risk mitigation should all be part of the plan.
- Collaborate with partners to explore case studies from outside the organization to assess the most appropriate direction for new solutions.
If you’d like more information, please get in touch with Phil Matthews.
