March 20, 2014
Your company is likely to face an extinction event in the next 10 years. And while you may see it coming, you may not have enough time to save your company.
Business leaders don't think of digital as central to their business because in the past, it hasn't been. But now your customers, your products, your business operations, and your competitors are fundamentally digital. While 74% of business executives say their company has a digital strategy, only 15% believe that their company has the skills and capabilities to execute on that strategy (see figure). These are just some of the findings from our latest research (Forrester clients click here).
For the past few years, companies have been bolting “digital” onto their existing business like teens paint go-fast stripes onto their cars. “Look, we’re digital” is the message CEOs want to send to investors. But the piecemeal strategy of bolting digital channels or methods onto the business is no longer sufficient. Instead, you must think of your company as part of a dynamic ecosystem of value that connects digital resources inside and outside the company to create value for customers. To do this, you must fully harness digital technologies, both to deliver a superior customer experience and to drive the agility and operational efficiency you need to stay competitive.
Dynamic Ecosystems Of Value
Consumers are already adapting digital tools to their lives, both for personal use and for business use. These tools — apps for smartphones and tablets — allow device owners to create a collection of tools that satisfy a need or want.
Think about the last time you went on a business trip. You probably used a collection of apps to help make the trip more effective. Some I use regularly include:
- Hipmunk to search flights.
- SeatGuru to check my airline seat choices.
- SPG to track my hotel reservations.
- American Airlines to deliver my electronic boarding pass.
- Avis to track my car rental information.
- TripAdvisor to find places to eat.
- Uber to get a car from point A to point B.
On its own, each app has some unique value to me, but when combined they create a kind of app ecosystem that allows me to get more value from my business trip — only through the collective use of my apps do I completely satisfy my desire for an effective trip. And if one tool doesn’t work, another is just a touch away; allowing me to update my digital ecosystem dynamically to match my needs at a specific point in time.
In the future, your business must adapt to these dynamic ecosystems of value and deliver a greater share of value to customers through these ecosystems. This is just one of the conclusions from our research. For the past 12 months, Martin Gill and I have been researching digital business and digital transformation. Our latest report, published today, "The Future Of Business Is Digital," lays the groundwork for the transformation your business must make.