Volatility in today’s business landscape is unprecedented: It is harder than ever to stay on top and win a lasting competitive advantage. Due to the Digital Disruption, it is now virtually impossible to develop a business model, cast it into the concrete of an enterprise resource planning (ERP) system and leverage highly optimized processes for years. Digital is about new business models that are emerging around “digital customers” that are always online thanks to the ubiquity of smartphones and mobile apps.
The always-online digital “things” (cars, houses, machines, etc.) equipped with sensors and “digital enterprises” externalized their customer-facing processes, democratized them, and made them available to consumers’ apps and partners’ ecosystem via APIs. Besides, each of the new generation of millennials has a “digital reflection” in the social media that can be targeted as a potential customer.
What does this mean for business?
The digital revolution means a new gold rush
Business has always been a human endeavor: You need a human employee to reach a human consumer and to deal with a human partner. But when they are digital, they can be done by a robot—a piece of software able to communicate with social media (hence Big Data analytics), mobile apps, partners’ processes, sensors, and agents (hence the Internet of Things). This means orders of magnitude increase in productivity with simultaneous cost reduction. Although this potential isn’t fully investigated yet, it drives businesses and investors crazy, creating a “Digital Rush.”
It isn’t clear at the moment what will win and what the winning digital strategy will be. Most probably there will be more than one anyway.
(Related: Why you need apps for BPM)
Instead, recall the amazing fact from the Gold Rush times: Those who sold equipment (picks and shovels), clothes (jeans) or alcohol sometimes made more money than gold miners. Similarly, there is a range of digital strategies one may integrate into an existing digital environment or try to establish on their own, such as operating on the front (customer-oriented) or back (service provider) end; inventing something; or replicating something invented next door, in another industry or culture.
With all these options there is only one constant: change.