Wednesday, March 20, 2013

Digital Disruption and Enterprise Mobility

This week in the March 18, 2013, edition of The Wall Street Journal was an article titled Built Not to Last by Alan Murray.  This article reviewed the book Digital Disruption by Forrester executive James McQuivey.  I loved the article and have now downloaded the book to read in its entirety.  I guess it is true that people like to hear what they already believe.  McQuivey identifies many of the trends I am also seeing in the market today.

In his book McQuivey argues that technology has made it possible to launch companies without large amounts of capital, proprietary labor pools or vast swaths of intellectual property. Increasingly, anyone with a powerful idea can assemble the tools to make his idea a reality.

Here are some of my favorite excerpts from Murray's article:

"The only defense to this massive attack [from digital disruption competitors], Mr. McQuivey says, is to mimic the enemy.   The consequences for existing companies, if you believe Mr. McQuivey, are extreme. "Digital tools allow digital disruptors to come at you from all directions— and from all ages, backgrounds and nationalities.  Equipped with a better mindset and better tools, thousands of these disruptors are ready to do better whatever it is that your company does. This isn't just competitive innovation, it's a fundamentally new type and scale and speed of competitive innovation."

I think of the hugely successful digital camera company GoPro.  I bet half of the films shown at the Banff Film Festival are filmed on a GoPro camera.  They enable every daredevil adventurer to film and produce their own next viral video for under $500.  A one person operation can now produce and publish film that would have taken a traditional studio millions of dollars.  That is digital disruption.

Here is another excerpt, "Managers must "adopt a digital disruptor's mindset" and "behave like a digital disruptor." "Gone are the days,” he writes, "when you can assign this task to the digital team or the mobile guys.  Everyone in every level of the organization must accept that they have the responsibility to become digital disruptors within their domain and as well as across traditional silos.”

I have been teaching SMAC (social, mobile, analytics and cloud) strategies sessions all over the globe the past few months.  I can verify that SMAC topics or digital disruptions cannot be limited to just the enterprise mobility team or the digital team.  Digital disruptions are impacting entire industries.  They must be taken seriously by all parties.

How do you face digital disruptions?  How do you know, what you don't know you need to know?  Here is McQuivey's recommendation, "Abandon traditional 'return on investment' metrics and instead, for digitally disruptive initiatives, adopt ROD—'return on disruption.' Where the goal in ROI is to generate a known return from a known investment, the goal in ROD is to invest as little as possible, placing quick, cheap bets on the initiatives with the largest possible breakout success."

Digital disruption means a mobile banking app can replace a physical branch.  It means a GoPro digital camera and YouTube can replace a studio.  It means Craig's List can replace billions in classified ad revenue for newspapers.  It means I can download McQuivey's e-book seconds after reading the review and by-pass the book store.

My advice is to face these digital disruptors early, before you get SMACked.  For a very good whitepaper by our Cognizant team on this subject download, Don't Get SMACked.

Kevin Benedict, Head Analyst for Social, Mobile, Analytics and Cloud (SMAC) Cognizant
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Full Disclosure: These are my personal opinions. No company is silly enough to claim them. I am a mobility and SMAC analyst, consultant and writer. I work with and have worked with many of the companies mentioned in my articles.