Digital Transformation: Buzzword or Business Imperative?
It seems that every few years there is a new “must do” trend in business. The most recent buzzword was “Cloud.” Everyone knew they should be leveraging it, but it was so nebulous that it really didn’t mean anything to anyone. It has taken years for people to figure out what the cloud really is and how to use it. Now, adoption of cloud technology is growing dramatically, impacting every facet of our lives.
So what is Digital Transformation? Will it continue to be a misunderstood, but frequently referenced, buzzword? Or is it critical for you to be thinking about your organizations’ transformation strategy? I say it is a little bit both. Definitely a buzzword, but this transformation we are all feeling is very real. We are on the cusp of what is being called the 4th Industrial Revolution. What were once just fanciful ideas are now not only possible, but commonplace. New industries are springing up every day, displacing what were once thriving businesses. You must not only dream about new ways to work, but implement them, or quickly be passed by.
Need an example to see it clearly? I love this explanation of Digital Transformation that Microsoft used at a recent event. Look at the Flatiron building in New York in 1903.
What do you see? Dirt streets and horses. Horse drawn carriages. Horse drawn delivery trucks. Single horses. In that era, there were probably hundreds of thousands of horses in New York City, employing thousands of people. People bred horses. Fed horses. Cleaned up after horses. They used them to deliver people and things.
Now look at the same place, just 20 years later.
What do you see? Vehicles. The streets are paved and we see cars everywhere. What is missing? The horses. So what became of all the horses and all those people involved with them? It probably depends on how they looked at their business and how they embraced that tsunami of change brought on by the technology change. If they had considered themselves to be in the transportation business, perhaps they sold their horses and bought delivery trucks. But if they considered themselves to be in the horse industry, the world quickly passed them by.
In this Digital Revolution, we see changes likes this every day. Amazon is the world’s largest retailer, but has no stores. Uber is one of the world’s largest transportation companies, but owns no cars. Air BnB is one of the world’s largest lodging companies, but owns no properties. And Netflix is one of the largest media companies, without owning stores or studios. And think about where Blockbuster is today… These companies, and many others have disrupted their industries.
This disruption is Digital Transformation. All of us need to begin thinking about how what is now, or soon will be, possible will change our lives and our businesses. How will you respond to the 4th Industrial Revolution? Adapt, or die?