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Survival = Moderated Risk-taking + Optimisation + Iteration
There was once a clear line distinguishing reality from science fiction. Life is complicated, and senior executives are roped into a struggle for clarity with more data and newer technologies available every day. But those who believe sheltering their enterprises in “more big datas” are missing the point. Information is meant to drive meaningful brand actions that enable businesses to keep abreast of change. Executives across the board seek to run enterprises that operate like software companies; they want lean teams, agility, responsiveness, and rapid iteration cycles that digest risk and generate benefits. The end result looks a lot like a Formula 1 racing team.
F1 racing teams depend on proactive problem solving to enable the driver to operate at the limits of possibility. “Intuitive” decisions (when to overtake) are enabled by a deeply collaborative network of technicians, engineers, technical apparatus, and data, along with external variables such as the weather. There are no guarantees of success (or safety), but there is a general approach that yields results:
Survival = Moderated Risk-taking + Optimisation + Iteration
Businesses that want to keep up with change need to have a digital vision, and must pilot low-risk projects that can provide insights and proof of concept for future growth at scale. If teams aren’t exposed to a little risk on an on-going basis, the stakes rise, and an innovation debt accumulates.
There is no stopping this.
Given the number of emerging technologies, knowing what to respond to and what to prioritise is perhaps the major challenge of the times. The need to make strategic decisions as soon as possible conflicts with the need to consider more possibilities than ever before. Furthermore, our ability to make good choices is clouded by misinformation and hype. It’s time to break down the challenge into an actionable approach.
1. Never Assume an Emerging Technology Is Irrelevant
Every emerging technology is a potential source of disruption. The Internet was created to enable the distribution of packets of data between scientists. It was an innovation catering to a minority of people within a very specific context. Few could have imagined it would pose a threat to postal services worldwide, undermine copyright legislation, or enable the emergence of P2P lending and crypto currencies that now have financial institutions flapping.
The first unmanned aerial vehicles (UAVs) were created during WW1 by coupling wooden and fabric airframes with gyroscope or propeller revolution counters. They were intended to drop payloads of explosives on U-boat bases. The UAV was an innovation catering to a minority of people within a very specific context. Few would have believed UAVs (commonly referred to as drones) would enable journalists to scope out conflicts, lead to the founding of an extreme sport, or pose a threat to postal services.
Nobody knows where the next change will come from. Every employee and stakeholder is responsible for maintaining a general awareness of new developments, and should have a voice in the conversation. Encourage lively debate and sharing. Assume everything has the potential to have an impact.
2. Look at Trends Through the Perspective of Your Customers and Organisation
No business can realistically “keep up” with change, as things are shifting too quickly. However, annual budgets do not grow in pace with technological change. Executives and managers need to make strategic, incremental investments that align with a long-term vision. Workforces that aren’t persistently challenged to acknowledge, test and trial emerging technologies will eventually accumulate an “innovation debt” too large to overcome. Looking to the West, innovation debts were easy to spot during the mid-to-late 2000s, with businesses operating in the media industries (notably film, music and publishing) tending to languish in their newly digitized world.
Assuming that everything has the potential to be disruptive does not imply that knee-jerk decisions need to be made the moment something new emerges. Maintain an awareness of your surroundings, decide on what matters the most to your organisation and customers, and respond to these things with immediate actions — much like a chameleon shifting color in response to the presence of a predator.
Ledgers are nothing new. They sit at the heart of commerce to record the exchange of assets, including money and property. A distributed ledger is different in that it is a digital asset database that sits across a network of different sites and institutions. Participants in the network can each possess a copy of the database, and changes to any one record in the ledger are applied across every copy. People are becoming familiar with the term “blockchain” — this is the distributed ledger that was invented to enable the peer-to-peer distribution of Bitcoins (a digital currency).
However, finance is only a starting point for this technology, which has since been used to exchange data, property deeds and contracts. With blockchain, if a single record is altered illegitimately, it will be flagged in the system as being inconsistent with the other copies. In this way, blockchain is being hailed as a technology that can enable transparency and be trusted to flourish in all manner of exchanges.
The following analysis explores the implications of this emerging technology for a real estate agency, from the perspective of the agency and its customers:
The Organization’s Perspective:
The Customer’s Perspective:
On the surface, blockchain has little to do with selling houses. But this example demonstrates how agencies that can adapt quickly to offer legitimised services that draw on the benefits of distributed ledger tech will come out on top, and prevent start-ups outside the industry from swooping in and capitalising on the opportunity. A little introspection and a deep understanding of consumer needs is all it takes. View emerging technologies from t
he perspective of your organization and your customers, and identify the hidden opportunity.
3. Lead with a Vision
Senior executives including the likes of Ganesh Bell (CDO, GE Power), Quentin Clark (CBO, SAP) and Jay Ferro (CIO, American Cancer Society) generally find that change is initiated from the top of an organization, from executives who believe in the potential of digital across the enterprise, and who have a “healthy dose” of paranoia toward fast-moving competitors. Having said this, change also needs to be seeded throughout the organization by “change ambassadors” — those who are passionate, driven, and who support digital actions. The structure and design of a business will enable or hinder this, so before initiating anything, brands must question where the barriers to change lie.
Knowing what to respond to, and what to prioritise, all depends on having a vision of the company’s digital future. With a vision in place, the possibilities for any trending technology can be analysed and projected forward in a way that ensures all actions are consistent with your brand. We call these brand-led actions. There is power in this process — instead of spectating and drawing conclusions from third-party reports, talk to professionals in the field, get their views, and map out the potentials in a way that not only relates to your business, but takes into consideration organizational and wider industry-level capabilities and limitations. Consider some examples of how broad trends may be turned into visions of the future for specific businesses:
VR for Travel
Virtual Assistant for an Online Luxury Retailer
Digital Solutions for Brick & Mortar Retail
In each case, some of the proposed applications are more pertinent than others; draw from the company vision to sort through the possibilities. Once an opportunity that aligns has been identified, create a pilot project to develop a solution. Allocate a modest budget, and ensure a digital change ambassador is empowered to drive it. Successful pilot projects can be nourished and grown into enterprise-wide movements that accomplish a range of missions.
Emerging technologies can also be used to strengthen existing competencies. For example, a supermarket may have a solid e-commerce platform in place and a CRM system that neatly meshes offline and online behaviours, driving customer loyalty. By incorporating beacons into the offline retail space, customers can benefit from more customised shopping experiences. The business can serve notifications based on geo-location tracking and shopper histories with relevant deals, plus localised offers that take into account the inventory of a specific store. If it works in one store, scale the program across a region, and onwards.
Of course, there are opportunities to break new ground too. “Edward” is an SMS Virtual Host that has been introduced to compliment Radisson Blu’s traditional customer service approach. Edward is built on an Interactive Text Response (ITR) platform, which enables “him” to understand simple English queries, including the difference between “a paper” (newspaper) and “some paper” (stationary). Any query that requires a physical aid (i.e. “I need a new room key”) is forwarded on to staff.
It’s a fantastic application of artificial intelligence that seems on the surface at odds with the hospitality sector, which hasn’t traditionally been viewed as “high tech”. Arguably such a concept would have been impossible to sell without grounding it in a wider vision for the future of Radisson Blu’s customer service. The success of this launch could redefine Radisson Blu’s approach to customer service across all properties.
There are many things that can be done with today’s emerging technologies, but they all require buy-in and support, from senior executives who “get” change to ambassadors in the workforce who want to grow something new. Mobilising people to take risks requires a vision that permeates every level of an organization.
4. Embrace a Culture of Experimentation
With an awareness of the transformations taking place in your industry, an understanding of the actions that are most in-line with the needs of your organization and customers, plus a strong vision staff can rally around, it is now possible to select which actions to pursue. But before investing significant amounts of capital, begin experimenting, testing, and enabling your change ambassadors to get comfortable with the technology: buy everything, test everything, try to break everything (discover limitations from a consumer’s point of view) and run through real-use scenarios. Embed lived realities into your thinking.
Failure is inevitable, but by running through this sequence, failure becomes something healthy and positive. Experimentation motivates people to pursue solutions rather than avoid risks.
There is an important distinction to be made between “trying something new” and taking a brand-led action that stems from a vision. In the summer of 2015, KFC celebrated its 60th anniversary of operation in Canada by integrating a Bluetooth photo printer into the bottom of its iconic chicken bucket. It was a nice gimmick that got a bit of press chatter. The end. The campaign surrounding this innovation was not oriented toward the brand’s digital future, nor towards a vision that anticipates a time when people will expect immersive digital experiences to be incorporated into fast-food packaging. The reason is simple: it wasn’t scalable. People do not carry photo printers in their pockets, nor do they necessarily print photos. But a great number of consumers have smartphones in their pockets.
In early 2016, McDonalds trialled happy meal boxes in Sweden that could be turned into cardboard VR headsets — a timely, innovative move that grabbed headlines. This has great potential to scale globally, as the brand is leveraging a pre-existing asset (cardboard) and media that can be duplicated at zero marginal cost. Without a vision in place, digital initiatives can quickly turn into gimmicks with little consequence for a brand’s long-term transformation.
In summary, the point of these four approaches is to begin experimenting with new technologies now, in a way that reframes shortermism. Shortermism isn’t necessarily “bad”, so long as short-term actions are brand-led and fit within a vision of a brand’s digital future. This vision of the future can only be illuminated by maintaining a general awareness of what is going on in and around your industry, respecting the power of disruptive technologies, and enabling change in your organization in the form of frequent low-risk plays that have potential to scale. Small investments are the individual steps up the staircase to digital competence, and will protect against indomitable crises in the future.