There is now plenty of evidence all around us on a daily basis of the power of digital technologies to completely over-turn businesses, and indeed whole industrial sectors. Uber is often cited as the most prominent with its challenge to the business of taxis, and we’ve also witnessed the major and global impact of AirBnB on holidays.
But we’ve also witnessed some major successes and failures in other industries over previous years many of which have not been so heavily publicised, for example the demise of Blockbuster and Kodak, companies which clearly did not respond to the fast-paced progress in digital technologies directly associated with their business. And on the flip-side we’ve seen some businesses which have embraced digital to gain commercial success and advantage, Pearson publishing (Penguin books and the Financial Times) in the publishing industry. And Amazon the online retailers, now taking on the major IT companies in its cloud computing solutions, Amazon Web Services. This launched over a decade ago as a solution to its own needs and is now holding over a third of market share – ahead of Google and Microsoft.
Previous to these major ‘disruption’ examples, we became familiar with the concept through the challenges within journalism and newspapers, and the music industry. Most of these were much slower paced and evolved through the major businesses involved. Many of the newer examples of digital business are leap-frogging many incumbent businesses having seen the challenges they face, and with the ability to launch and start-up without the ‘baggage’ and need for restructuring and major process change which can face the current market leaders.
Over the years ahead we can expect to see developments in digital business which will impact on the local and regional economy as well as global. Examples of local B&B losing out to AirBnB are already apparent, and meanwhile in Bristol the launch of Laundrapp has been heralded as the Uber of the laundry world. Laundrapp collects your dirty clothes, cleans them at professional facilities and then delivers them back to your door at the time and place you choose.
Digital disruption is a well-used term and is being better understood at all levels across the world. Businesses themselves need to review how vulnerable they are to potential disruption, and then use this understanding to better respond to the threat, or indeed to start disrupting themselves before someone else does. The leaders in businesses across the region need to spend time familiarising themselves with the concepts of digital disruption, and what is happening globally in their industry sector, or in other sectors using technologies which could translate into theirs.
So here’s a simple checklist for you to consider
- Is your business already developing a digital solution to improve product, service and customer experience?
- Have you recently reviewed how your competitors are responding to changes in the marketplace and digital innovations?
- Have you made sure that the strategic plan for your business has been thoroughly tested against progress in digital technologies which will impact?
- What are you doing to monitor developments in digital start-ups within your industry or sector?
A recent report (November 2015) from KPMG highlights the fact that only a quarter of businesses in the South West, believe they are superior to their competitors on the innovation front.
And at the same time, of course, there are new digital technologies being launched all the time. Wearable technology is now becoming more-and-more prevalent and the data which these devices provide is growing all the time. Questions about how businesses can really maximise the potential of new data sources, and use those to influence and inform business plans is key. Business leaders also need to understand the power of data to transform, grow and disrupt theirs (and others) businesses.
Most importantly, the customers of our businesses will have the power to disrupt. They will become more-and-more influential in the way products and services are developed and delivered. And so smart businesses will embrace and empower their customers to give regular feedback, share their experiences and bring them into the development process where possible. Giving your customers this role and inviting them to collaborate is an excellent way to innovate your service for the future, and digital platforms can help with this process.
For more details on the need for improved Digital Leadership – please register here to access our recently published White Paper.
Sign up now to one of Cosmic’s Digital Leadership taster courses running this year – more details here.