While discrete technology trends often get all the attention in New Year’s lists, this coming year will be highlighted by organizations taking a more holistic focus on digital transformation that taps into platform business models, the power of technology combinations, mastery of digital services and leading practices in corporate innovation. There will also be an increasing number of “world-firsts” coming out from the corporate sector as vertical industries refine their mastery of digital business.
In light of those impending developments, here are five digital business predictions for 2017 that C-levels need to consider when planning for the year ahead.
Accelerating pace of digital: from tech-led to corporate “world-firsts”
In 2017, we can be certain that change will be one of the only constants. The pace of innovation, particularly from large corporations and government, will start to close the gap with the tech sector, with “world-first” innovations being rolled out on an almost weekly basis.
We’re already beginning to see this in the financial services sector, with examples such as Barclays’ recent introduction of contactless cash and blockchain trade finance transactions. These illustrate how organizations are rethinking and redesigning business models and processes, along with tech partners, and launching a cadence of innovations month after month.
Organizations are also working with new strategies that convert linear value chains into multidimensional value networks, new skills to support digital assembly lines, new processes that place greater emphasis on the front end and back end of the innovation life cycle, and new technologies such as the internet of things (IoT), intelligent automation, blockchain, mobile payments, wearables and augmented reality applications.
Platform business models: from value chains to value networks
In 2017, we’ll continue to see accelerating topple rates among the Fortune 500 as well as corresponding shifts in industry leaders. We may also see greater separation between digital leaders and laggards — driven by how well they deliver upon the digital customer experience — as well as more partnerships between industry players and high-tech players as they join forces to create superior offerings and integrated value propositions.
Many of these new partnerships will be powered by platform business models that will likely generate some of the highest-magnitude business disruptions in the years ahead as they dissolve industry boundaries and extend the boundaries of the customer journey. These models have been shown to have much higher valuations when compared to traditional business models, primarily because they require no physical assets and convert linear value chains to multidimensional value networks.
One of the first tasks for C-levels in 2017 will be to put in place a suitable platform vision and strategy for their organizations. This should be accompanied by in-depth investigation into platform architectures and operating models, competency building and investment in initial deployments.
Disruptive technologies: from discrete technologies to technology combinations
In 2017, we’ll see a large number of new technology enablers come into focus as value enhancers within digital business models and processes. “Digital experience essentials” such as SMAC technologies cater to basic customer needs and expectations and have become table-stakes for digital applications.
In contrast, “digital experience enhancers” such as the IoT, intelligent automation technologies, wearables and AR applications will be used by forward-thinking companies to carve out innovative spaces and to delight their customers with remarkable new experiences that are unlike anything that’s come before.
In intelligent automation, we’ll see a fast-evolving digital workplace that combines the best of what humans and machines have to offer. Machines will continue to become more social (e.g., “emotionally intelligent” virtual agents, “trainable” factory robots and autonomous delivery robots) and humans in turn will continue to become more instrumented (e.g., wearables in the workplace for hands-free process optimization), all of which will amplify the possibilities.
It’s key for organizations wishing to tap into these technologies to understand that they should not be implemented in a vacuum. Instead, they should be thought of as “digital experience essentials” and “digital experience enhancers” that can be combined in powerful ways to build unique new customer value propositions and business models.
Digital services mastery: from discrete techniques to digital assembly lines
In 2017, the most successful organizations will be those that develop an end-to-end digital capability that spans design and development all the way to deployment and management. Those organizations will be able to evolve their digital services continually over time with tremendous agility and at high levels of sophistication and scale.
Digital services mastery will become a key point of differentiation for organizations by helping them innovate their services more rapidly than competitors and uniquely tailor them for each customer. The key techniques to master will include agile, DevOps, as-a-service infrastructure, intelligent automation, personas and context, and digital service management.
Taking a life cycle perspective, the idea is to accelerate digital service development and deployment; make services agile, scalable and available on-demand; automate extensively; personalize and contextualize for the customer experience; and manage holistically.
As with technology combinations, the key will be for organizations to integrate multiple techniques and approaches into an end-to-end capability that supports and enriches all their essential digital touch points, interactions and transactions with customers.
Innovation management: from idea-centricity to “where to play” and “how to scale”
In 2017, the discipline of innovation management will evolve further as well, going beyond the table-stakes of idea management and addressing the front and back end of the innovation life cycle. By exploring “where to play” and “how to scale,” organizations will be able to provide more connectivity into the adjacent corporate processes of strategy and execution so that strategy can help to guide innovation, innovation can help to inform strategy, and innovations can be successfully launched and scaled.
Technologies such as robotic market intelligence will help managers keep better tabs on emerging market trends and technologies, and simulation techniques and algorithms will help managers run what-if scenarios for exploring their digital futures, as well as planning how to scale their business innovations most effectively.
Some of the leading players in innovation management software are already embarking on this journey with a number of new capabilities as well as planned future enhancements in their product road maps. With continuous digital transformation being key to corporate survival, tapping into a new breed of innovation management software will be a valuable way to maximize chances for success.
We’re still at the beginning of an exciting journey which will take us into the next 10 years and beyond. While the term “digital transformation” may change in the years ahead, you can be sure it will continue to be both digital and transformational.
As the technology industry matures, and the discipline of digital transformation matures along with it, perhaps the most important elements to bear in mind in 2017 are those of value networks, technology combinations, digital assembly lines and connected innovation.