EPILOGUE

YOU AIN’T SEEN NOTHIN’ YET

In this book, we’ve presented a case for why your organization should strive to become a Digital Master—an enterprise that’s able to use each new wave of technology to radically improve the performance or reach of its business. Our research has shown that Digital Masters enjoy superior performance, which should be reason enough to get leadership teams interested in the concepts presented in this book. But there’s also another, even more fundamental, reason: when it comes to the impact of digital technologies on the business world, we ain’t seen nothin’ yet.

TECHNOLOGY: THE ENDLESS AGITATOR OF THE BUSINESS WORLD

The innovations we’ve discussed in previous chapters, including social networks, mobile devices, analytics, smart sensors, and cloud computing, are certainly powerful and profound. They’re reshaping customer experiences, operations, and business models. The pace and impact of these innovations have been nothing short of astonishing, but they’re just a prelude for what’s to come.

Technology’s role as the endless agitator of the business world will not only continue, but will accelerate—exponentially. Moore’s Law will continue to be the central drumbeat of the digital future.¹ In five years, technology will be about ten times as powerful as today, for the same price. In ten years, the increase will be a hundredfold. If you find yourself struggling to keep up with waves of change over the past few years, you’re in for a rough ride. Keeping up will be even more difficult in the future, unless you develop the skills of the Digital Masters.

The good news is that some of the next transformative technological innovations are already on the horizon. They will continue to reshape customer experiences and operations in fundamental ways. We’ve seen Digital Masters hard at work figuring those out already.

The most significant innovation is the continuing business impact of data and analytics—the explosive increase in the amount of information available in digital form, and businesses’ ability to use new insights to make smarter decisions. This is a fundamentally important development because data is the lifeblood of science—of improving our understanding of what causes what, and why, and under what circumstances. In the years to come, smart organizations will use big data to become better, smarter, and more rigorous at many key activities: making predictions and forecasts; hiring and promoting people; deciding on product attributes; optimizing internal processes; marketing and advertising; and customizing products and services (to name just a few). Companies that use big data to get better at these activities will pull ahead of those that don’t, as sure as gamblers who know the odds pull away from those who bet only on gut feel.

Gaining new analytic skills can’t happen fast enough, as companies gather richer data on their customers and operations, as unstructured data-analysis techniques open social media to investigation, and as more and more devices report data through the “internet of things.” How will your internal processes change when you have detailed information on the full performance of processes and products in real time? How will your hiring and HR processes change when you have this kind of measurement for employees? How much better will you be able to personalize your services through ever more granular insights into customers’ needs and behavior?

Other waves of technology innovation will also be significant. Robotics, additive manufacturing, augmented reality, and wearable technology, among others, will fundamentally change the way businesses operate. They will transform the nature of operations, customer experience, and even business models.

Until recently, industrial robots were expensive, inflexible, and dangerous if people had to work too close to them, but all of that is changing. People work side by side with automatons in many factories now, and human-robot collaborations are only getting closer. Robots are rapidly getting better at seeing, feeling, and otherwise sensing their environments, which enables them to take on more and more work. And they’re escaping the factory floor and moving through the economy; driverless cars and other autonomous vehicles are robots, even though they’re not anthropomorphic. They’ll change the logistics and transportation industries, not just the manufacturing ones. As Watson, the computer that won the TV quiz show Jeopardy!, enters law and medicine, what will that mean for the way those fields are managed? How will industrial robots change the shape of your supply chain and logistics management?

Additive manufacturing (also called 3-D printing) will open up further business opportunities. It holds the promise of giving companies the ability to literally print out parts just as easily (if not yet as quickly) as they now print out documents. These parts, which can be made from several materials, including plastic and metal, can have highly complex geometries; additive manufacturing is not constrained in the same ways that traditional fabrication processes are. Already, 3-D printing is being used intensively for prototyping and for small production runs of specialized parts. It will expand much beyond these initial uses. How will your inventory management processes change if you don’t have to stock low-volume parts? How would your design and sales activities change if you could print custom parts on demand?

Augmented reality meshes real-world environments with additional data and presents a revised environment with computer-generated sensory forms such as sounds, graphics, and video. This technology will allow consumers to experience what your product or service has to offer like never before. Trying on a new outfit in a virtual changing room, changing its color, adding jewelry to dress it up, or asking your friends on Facebook for comments—all will become the norm. Over time, online shopping may become as immersive as visiting a store.

Augmented reality will also change your internal processes. For instance, your field maintenance engineers could use tablets to visually identify pieces of your infrastructure and automatically overlay all maintenance records and procedures. In one major electronics firm, product designers using 3-D augmented reality discovered that a wire harness would rub repeatedly against another part, causing the harness to break prematurely—a condition they could not see in their 2-D design software. How could you use this technology to increase the prepurchase experience for your customers? Could it help you substantially improve the productivity of your operations?

Wearable technology, as commonly described today, is meshing real-time monitoring and feedback technology with design and mobility. Nike’s FuelBand, which we described earlier in this book, is an example. Wearable items will track anything, from your sleep patterns to your heart rhythms. Smart socks will monitor your running technique. You may be able to change the color or thermal properties of your T-shirt at will. Digitized eyewear, such Google Glass, will open up exciting new possibilities. For instance, video images from inside machines can be streamed directly to a technician’s eyewear, overlaying machine specification data to sharpen diagnostics, while keeping the worker’s hands free to conduct repairs. Could the constant monitoring of how your customers use your products and services uncover new sources of growth? Can you monetize the new data stream that wearable technology brings? Have you considered how much more productive your engineers and technicians could be if they used wearable technology in your core operations?

Fast-moving technologies may also change the way you organize and innovate. The so-called sharing economy is forcing a rethink of large, asset-heavy industries, with important implications for the business models of large firms. Open innovation can build communities of interest, surface new sources of talent, and, for some problems, make progress both more quickly and more cheaply than approaches that rely on internal resources and centralized planning.² Social media and the seamless flow of data can bridge organizational boundaries and flatten hierarchies. What is the role of middle management in a digitally transformed enterprise? How might you overcome the nagging limits in your traditional organizational model?

LEADING DIGITAL IS A JOB FOR NOW

Technology is reaching into every corner of the business world—every industry, company, process, decision, and job—bringing deep changes in how companies are structured and led, and how they perform and compete. Over time, it will create a new playing field with new rules—and new winners and losers.

It’s not yet clear exactly how any of the innovations we discussed here will progress, or how broad and deep their impacts will be. We think that, individually, each of them is likely to be a big deal indeed in the business world. In combination, their effects will be hugely transformational.

We’re also confident that other technologies will be even more transformational; we just don’t know what they are. The history of technological progress, and particularly progress with digital technologies, is one of constant surprise. Who knew that, within one generation, the personal computer would become an indispensable tool for virtually every knowledge worker? That a multimedia interface would turn the internet from a geek’s network to the world’s connective tissue? That phones would become an entirely new category of computing device? That social media, a mere diversion ten years ago, would grow to billions of connected people and become a vibrant organizing force that could topple governments?

This work of innovative astonishment is nowhere near over. The world abounds with ever more potential innovators, entrepreneurs, inventors, tinkerers, and geeks, and they have access to more and more increasingly powerful computing technologies all the time, at lower and lower price points. These tech-savvy people are going to come up with things that change the business world, and hence the world. We’re not nearly good enough tech forecasters to predict what all of these advances will be, but we’re fully confident that they’re coming. We ain’t seen nothin’ yet.

The best way to get ready for these changes—in fact, probably the only way—is to start the work of becoming a Digital Master now. Companies that are indifferent to technology (to say nothing of hostile to it), or that haven’t figured out how to make it part of the lifeblood of the enterprise, are going to have an increasingly hard time as the innovations keep mounting and the management breakthroughs keep coming.

We’ve written this book as a guide to help you in the work of digital mastery. It’s not a blueprint—a complete description of everything you need to do to build the technologically adept company—because no such blueprint exists. Every company is different, and so is every company’s path to mastery. But the patterns we’ve seen among those who do it well—the DNA of Digital Masters—can be helpful for any digital transformation.

We hope that the examples, explanations, and frameworks we’ve shared in Leading Digital will be useful to you and will help your organization thrive in a new, digitally transformed, world.