Digital technology and the Internet of Things (IoT) are opening up new opportunities for companies to create new sources of customer value and revenue streams, according to Gartner, Inc. However, meaningful digitalized revenue opportunities are difficult to access and address, leading to significant challenges in establishing a fully digitalized business. Gartner believes that a digital edge comes from creating new combinations of analog and digital resources resulting in new sources of customer value and company revenue or results. Analog resources refer to the people, how they are organized, the equipment they use, the facilities they work in, as well as the company’s other physical aspects. Digital resources include information, customer history, situational awareness, and so forth. Digital resources also include the equipment that processes information such as mobile phones, tablet computers, sensors, computer controlled machinery, etc. However, a digital edge rests on more than the relationship between analog and digital resources. These types overlap in the sense that organizations can achieve similar goals with different types of digitalization.
Transformation in E-Commerce
E-commerce is growing at double-digit rates in the United States and most European countries, and it is booming across Asia. According to McKinsey, to take advantage of this momentum, companies need to move beyond experiments with digital and transform themselves into digital businesses. Yet many companies are stumbling as they try to turn their digital agendas into new business and operating models. The reason is that digital transformation is uniquely challenging, touching every function and business unit while also demanding the rapid development of new skills and investments that are very different from business as usual. To succeed, management teams need to move beyond vague statements of intent and focus on “hard wiring” digital into their organization’s structures, processes, systems, and incentives.
The Necessary Elements
Organizations that undertake digitization need to focus on the following key design factors:
- Greater need for transparency to tackle competitor forces – as related to price comparisons, customer service level, product performance and availability.
- Leveraging economies of scale through automation, i.e. increased returns through creation of meta-data.
- Identifying and building effective partnerships and joint ventures to force multiple the company products and services.
- Managing customer expectation to provide unique and singular experience within the B2B and B2C domains.
- Hiring the right talent to further the company footprint and portfolio in an evolving global business model.
“Big Data” is the term for a collection of datasets so large and complex that it becomes difficult to process with traditional database tools or data processing applications. A 2013 study, “The Emerging Big Returns on Big Data,” by Tata Consultancy Services found that most investment in Big Data goes toward projects that generate and maintain revenue, specifically sales, marketing, customer service, and R&D. Virtually all industries are using Big Data to some extent, but here are the “big four” that are using structured data – Medicine, Finance, Engineering and Weather.
Today, the focus of Big Data is on information. However, as the cost of all technologies inexorably drops, people are increasingly connecting devices, sensors, and all manner of other things to the internet. (Cisco estimates that the number of devices connected to the internet will grow from around 10 billion today to 50 billion by 2020.) And since they are connected, it’s no big deal to have things record their own activities, whether it’s capturing video, measuring pollutants in the air, or monitoring the contents of our refrigerators. This data in turn will be analyzed and, at least for some of it, new and useful insights will be generated that in turn will lead to productive business and marketing endeavors.
Organizations that capitalize on big data stand apart from traditional data analysis environments in three key ways:
- Focusing on data flows.
- Relying on data scientists and product and process developers rather than data analysts.
- Migration of data analytics from the IT function and into core business, operational and production functions.
Digital Edge, and especially Big Data and Internet of Things, is transforming the way organizations solve their most complex problems. Eximius can help these organizations realize the power of digitization to transform their operations, supply chains, marketing, sales and product development.
Using Eximius’ deep specialist knowledge, long track record and comprehensive tool sets, clients can implement digital transformation to solve some of today’s most complex business challenges to create a world that is better informed by the data around us.