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CIOs must rebuild concepts, skills, assets and research
Gartner, the world leader in unbiased technology research and advice, says organizations going through the digital business transformation can make this process easier if they create a vision for their own industry. According to the 2016 CIO Agenda, by 2020, executives expect 41% of business revenue to be generated by digital businesses, nearly double what happened in 2015. Yet in 2016, many organizations have not yet initiated a digital business transformation .
"Companies can be transformed by exploiting business moments or by using digital skills to create or enter new markets, as Airbnb and Uber have done. However, many companies will find it easier to start with creating a vision for the digital business This approach enables the company to turn the fundamentals of the competition in its favor without limiting digital business to small event sequences and large project commitments. business moments or leverage your digital skills in new markets," says Jorge Lopez, Vice President and Analyst Emeritus at Gartner.
To take this approach, CIOs in charge of digital business need to understand the importance of an industrial vision in this area. “Overall, an industry overview shows what business would look like if companies used the Internet of Things (IoT) and smart machines to their full potential. For asset-heavy industries, digital technologies can automate large-scale operations, not just across individual business processes, but across an end-to-end operation. Productivity advances as intelligent automation makes decisions better and faster, producing more at a lower cost, fewer assets, and more downtime At the same time, optimal production usually reduces the company's environmental impact,” explains Lopez.
An industry view is made up of four parts:
Concept - An industrial vision looks for fundamental changes that will affect many dimensions of business and operations, such as the case of an auto parts manufacturer that empowers its factories with plastic 3D printers or composite parts rather than having to order and wait for delivery. The producer would not have to buy raw materials, manage suppliers, manufacture the parts and distribute them to wholesalers. The business economics would change and most of the costs would disappear. However, other challenges would arise, such as creating an accurate digital description of each part and the need to make sure that factories have the correct equipment, process experience and materials for printing.
Skills - Organizations need a new set of competencies to make digital business work. These skills will require a level of expertise that the company does not yet possess. In the example above, the auto parts manufacturer would have to market 3D printing service in a new way to a new audience and would need to provide training to parts suppliers when dealing with a 3D printing operation to maintain a support service, dominating any problem the workshop encounters. The organization may develop some internal competencies (for example, the IT department may create 3D print files), but it will need partners to establish business, such as a 3D printing company and a plastics or metal supplier. She may also need to acquire other companies (perhaps one that administers assistance). Sales and Marketing will need innovative contracts.
Active - Companies need a different set of assets to run their business, including people, data, and intellectual property (IP). The parts manufacturer will have to take on their 3D modeling skills, their knowledge of 3D printing, establish databases and networks to quickly send correct files, and start a digital marketing program to keep the bodyshops engaged. The organization will need staff hired for this work, who must have accurate parts and customer data at their disposal, as well as analytical tools to assess the business and operations. Since the new approach provides a competitive advantage for the company, it must develop and protect its IP – a complex challenge as it must collaborate with partners and have its own intellectual property.
Search - The new digital business is not static and will expand into new areas. Organizations will have to maintain a research program designed to add to the business and will need to continually experiment with new digital business possibilities. These possibilities will require new technologies, so organizations will need to research partnerships, especially with universities.
"Companies can be transformed by exploiting business moments or by using digital skills to create or enter new markets, as Airbnb and Uber have done. However, many companies will find it easier to start with creating a vision for the digital business This approach enables the company to turn the fundamentals of the competition in its favor without limiting digital business to small event sequences and large project commitments. business moments or leverage your digital skills in new markets," says Jorge Lopez, Vice President and Analyst Emeritus at Gartner.
To take this approach, CIOs in charge of digital business need to understand the importance of an industrial vision in this area. “Overall, an industry overview shows what business would look like if companies used the Internet of Things (IoT) and smart machines to their full potential. For asset-heavy industries, digital technologies can automate large-scale operations, not just across individual business processes, but across an end-to-end operation. Productivity advances as intelligent automation makes decisions better and faster, producing more at a lower cost, fewer assets, and more downtime At the same time, optimal production usually reduces the company's environmental impact,” explains Lopez.
An industry view is made up of four parts:
Concept - An industrial vision looks for fundamental changes that will affect many dimensions of business and operations, such as the case of an auto parts manufacturer that empowers its factories with plastic 3D printers or composite parts rather than having to order and wait for delivery. The producer would not have to buy raw materials, manage suppliers, manufacture the parts and distribute them to wholesalers. The business economics would change and most of the costs would disappear. However, other challenges would arise, such as creating an accurate digital description of each part and the need to make sure that factories have the correct equipment, process experience and materials for printing.
Skills - Organizations need a new set of competencies to make digital business work. These skills will require a level of expertise that the company does not yet possess. In the example above, the auto parts manufacturer would have to market 3D printing service in a new way to a new audience and would need to provide training to parts suppliers when dealing with a 3D printing operation to maintain a support service, dominating any problem the workshop encounters. The organization may develop some internal competencies (for example, the IT department may create 3D print files), but it will need partners to establish business, such as a 3D printing company and a plastics or metal supplier. She may also need to acquire other companies (perhaps one that administers assistance). Sales and Marketing will need innovative contracts.
Active - Companies need a different set of assets to run their business, including people, data, and intellectual property (IP). The parts manufacturer will have to take on their 3D modeling skills, their knowledge of 3D printing, establish databases and networks to quickly send correct files, and start a digital marketing program to keep the bodyshops engaged. The organization will need staff hired for this work, who must have accurate parts and customer data at their disposal, as well as analytical tools to assess the business and operations. Since the new approach provides a competitive advantage for the company, it must develop and protect its IP – a complex challenge as it must collaborate with partners and have its own intellectual property.
Search - The new digital business is not static and will expand into new areas. Organizations will have to maintain a research program designed to add to the business and will need to continually experiment with new digital business possibilities. These possibilities will require new technologies, so organizations will need to research partnerships, especially with universities.
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