Ensuring that technologies are understood and integrated into your company's roadmap on time is more than ever a crucial skill for any Executive Committee or Board of Directors.
Whether they are transformative or disruptive in your industry, the proliferation of technologies, their intrinsic complexity, and the suddenness with which they can become mainstream after often many years of incubation, put a strain on executives' nerves.
Take Artificial Intelligence, for example. Its development and teaching in universities began over 40 years ago. Suddenly, less than 2 years ago, it became the hot topic on the agenda of General Management and investors. Often incomprehensible jargon, irrational enthusiasm, hype from consultants and the media... and yet it's impossible to ignore the phenomenon and fail to make the right investment decisions in a wide range of sectors!
UNDERSTANDING TRANSFORMATIVE TECHNOLOGIES
You're lucky: transformative technologies only have a partial impact on your company's future, for example by changing your internal processes, your distribution, or your customer relations. But they don't jeopardize all your past competitive factors. If they are understood early enough and integrated into your operational evolution, they open up new opportunities for growth and help you to become more efficient and effective. By way of example, the digitization of processes for Construction companies needs to be integrated, but does not dramatically transform the business model of major construction firms.
To successfully integrate these technologies, it is essential to:
Anticipate their impact: Identify emerging technological trends early on and assess how they can help improve your operations.
Training and awareness: Make sure your management team understands the implications and benefits of these technologies. Take swift action to disseminate training to your staff and reduce the barriers to change.
Adopt an incremental approach: Integrate these technologies gradually into your strategic roadmap, starting with pilot projects before rolling them out across the board. Don't get caught up in calculating ROI: It's true that new technologies transform processes and boost productivity, but they also generate new recurring costs and new use cases. It's not always easy to draw up an indisputable balance sheet. On the other hand, miss out on a technological generation, as banks or traditional airlines have done, and you can quickly lose market share and damage your brand image forever with your customers.
IDENTIFYING AND DEALING WITH DISRUPTIVE TECHNOLOGIES
Disruptive technologies, on the other hand, have the potential to completely revolutionize your business model. Ignoring or underestimating these advances can be fatal for a company. This is the case today for electrification and electronics in the automotive industry, and for digitalization in the retail.
To anticipate these technologies early enough, it is essential to:
Constant monitoring: Set up a technology watch system to detect weak signals and new players exploiting these technologies. Don't stay on the surface in your understanding of the ongoing revolution. Don't underestimate the changing rules of the game. Position yourself early enough in the emerging ecosystems, for example by investing in start-ups at a very early stage. It's not about being right or wrong in your investments. It's about identifying and understanding the new competitive factors, so you don't wake up too late.
Reinvent the business model: If a disruptive technology is on the horizon, be prepared to question your current business model and adapt it accordingly. It's easier to write than to implement, given the difference in value between an established, listed company and a new venture that investors are snapping up.
Invest in innovation: As far as possible, seek to be pioneers and innovators, by investing in cutting-edge research and development. Combine in-house work, collaborations with universities and participation in the incubation of new start-ups.
Establish appropriate governance: Create ambidextrous governance that enables you to operate your current business while anticipating future transitions and incubating future business. Demonstrate vision and perseverance in your decisions because transitions often last several years, and must not be questioned at every budgetary cycle. There can be no winner in the battle between strategic and operational leaders. A true leader must have both skills, and be supported by his Board of Directors, thanks to his talent for communication and his results.
History shows us that very few companies successfully make the transition from one technological generation to another and are able to keep their leadership in their sector. No manufacturer of horse-drawn stagecoaches has ever become the leader of the automobile industry. Kodak is another emblematic example of a company that participated in the invention of digital photography but failed to survive the transition from silver to digital.
And yet, there's nothing inevitable about it! The multiplicity of technologies over time, and the feedback and lessons learned from them, are enabling the emergence of a new generation of entrepreneurs, capable of steering their businesses through transitions.
THE EXPERTISE OF IMPACT 4 BUSINESS-PARTNERS
For many companies, understanding and managing technological transitions is complex, and difficult to achieve with in-house resources alone. Successfully integrating technology into their strategic roadmap is a major challenge.
This is where the expertise of Impact 4 Business partners comes into play: their strong international and technological experience, their dual skills in strategy consulting and corporate operational management, and their pragmatic, impact-oriented approach will enable you to make crucial decisions, allocate your resources efficiently and adopt a "test and fail fast and cheap" mentality to always stay one step ahead.
Whether you're facing transformative or disruptive technologies, the key lies in early understanding, agile adaptation, and a commitment to continuous innovation. With the right skills and strong partners, you can not only survive, but thrive in an increasingly technological world.
Impact 4 Business provides its executive customers with the complementary skills they need, in the way best suited to their specific context: consulting, interim management and senior advisory.
If you'd like to find out more, please get in touch with us: contact@i4b-partners.com
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Impact 4 Business is a collective of partners who provide company executives with the ability to multiply their resources. Our team members all have over 25 years' experience and combine a strong background in strategy consulting (McKinsey, BCG, Bain, Kearney, Oliver Wyman...) and operational leadership (CEO, BU Director, Executive Committee members). Our aim is to "Get your teams up and running like an Executive, while structuring the project like a Consultant". Tailored to your needs, our engagements combine consulting, interim management, and mentoring.
To find out more: www.i4b-partners.com
APPENDIX
Four concrete examples of companies that made the right technological decisions and those that ran into difficulties.
Example 1: Blockbuster vs. Netflix
Difficulties due to a poor technological decision: Blockbuster, a company once dominant in physical video rental, failed to anticipate the potential of content streaming. They rejected Netflix's offer to buy them in 2000. As a result, Netflix became the leader of the streaming industry, while Blockbuster went bankrupt.
Lesson: Ignoring or underestimating disruptive technologies can lead to a company's demise.
Example 2: General Electric (GE)
Successful adaptation to transformative technologies: General Electric has understood the importance of the Internet of Things (IoT) for the manufacturing industry. They invested heavily in industrial equipment connectivity and created the Predix platform for data analysis. This approach has enabled them to improve predictive maintenance, reduce downtime and increase operational efficiency.
Lesson: Progressive integration of transformative technologies can boost competitiveness and create new opportunities.
Example 3: Nokia
Difficulties due to a poor technological decision: Nokia was once the world leader in cell phones. However, they were slow to adopt the Android operating system and continued to favor their own platform, Symbian. This decision led to a loss of market share to Apple and Android smartphone manufacturers.
Lesson: Reluctance to adopt emerging technologies can lead to rapid decline, even for market leaders.
Example 4: Apple
Good technological decision: Apple Inc. anticipated the potential impact of the smartphone on the cell phone industry. They reinvented the business model with the launch of the iPhone in 2007, thanks to a new electronic design and operating system, a major evolution in telephony. This innovation revolutionized the way we communicate, work and play, and propelled Apple to global leadership.
Lesson: Anticipating technological trends and reinventing your business model can help you seize massive opportunities.
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