The digital revolution is creating new opportunities for leadership
Digitalization is the single most talked-about topic among business leaders at all tech and non-tech companies—including small, midsized, and large companies, in all industries and all lines of businesses. Why?
The reason is very simple: Digitalization is converging all technologies, from cloud-based IT, mobile, and the Internet of Things (IoT) to Big Data. Digitalization is driving the next digital revolution and leading to a new wave of productivity.
Old business models are being shattered, with disruption driving new innovation, new ways of thinking through problems, and new solutions.
Let’s take a look at some of the implications this disruption is bringing.
The demise of old business models—and the birth of new ones
Uber and Airbnb are two well-known companies that are already riding the digital transformation disruption wave. With only access to handheld smartphones, every car owner or homeowner today can provide a service by sharing their car or home to generate revenue. Both are perfect examples of how disruptive digital business models are paving the way for revenue generation, great customer service delivery, and consumer value. Both are eroding the business of traditional service providers such as taxis and hotels.
In the automotive industry, connected cars are another form of digital disruption. As consumers expect and demand to be constantly connected, new players are entering the automotive market. Software companies, financial institutions such as credit card companies, and telecommunication companies are transforming the industry and changing its landscape. Automotive companies must either share their profits with these new entrants, build solid internal capabilities to challenge them, or collaborate with them quickly and strategically to create the value today’s consumer demands.
Every company is a tech company
In previous years, there has been a clear distinction between what tech companies and non-tech companies do. But with access to supercomputing and aligned technologies such as Big Data, mobile, deep data analytics, and cheap commodity hardware, non-tech companies can now leverage data to make more informed business decisions. With access to historic and real-time data, companies can upsell and cross-sell to customers and use data to deliver better customer service.
Retail giants such as Walmart, Caterpillar, and many other traditional non-tech companies are becoming tech companies as they sit on tons of data, which they can leverage to build business and provide added value to customers. Without the digital revolution, leveraging data to extend business capabilities would have been impossible.
Data privacy: a major concern
Recent data breaches at government institutions such as the FBI, retail giants such as Target, and electronics and media companies such as Sony are raising concerns. So, too, is increasing governing agency oversight on the day-to-day lives of American citizens. This changing environment makes companies and individuals rethink their data privacy approaches.
With every aspect of our lives digitalized, there are major concerns that our precious personal data could be misused by authorized or unauthorized entities. It has become more and more important for businesses, government agencies, and non-profit institutions to safeguard and secure the personal data of individuals from unwarranted harassment and violations of personal freedoms and liberties.
While digitalizing aspects of their lives has advantages for many people, the risk of data misuse will continue to be a major concern.
CIOs can lead by driving change
With all the possible implications of digitalization and the digital revolution, CIOs can play a key role in driving change by smoothing this transition for their organizations. As technology experts with sound understating of information systems and business processes, CIOs can lead the way by collaborating with other C-suite executives in understanding their needs and translating those needs into business outcomes that can add new capabilities and impact enterprise-wide competitiveness.
By participating actively in driving this enterprise-wide change, CIOs can help build new business models for tech and non-tech companies alike. By collaborating and working hand-in-hand with other C-suite executives, CIOs can diffuse the conflict created by departmental silos and differences in departmental objectives.
With a focus on data security, privacy, and data stewardship, CIOs can pave the way for new-age enterprises that leverage data to deliver great customer value and improve the bottom line.
SOURCE: World Economic Forum