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Wednesday, February 05, 2014

Redefining Digital Enterprise(s) by Reimagining Possibilities

Karl Heinz Streibich is the CEO of Software AG – a very well-known name in the technology industry has now come up with a book titled- The Digital Enterprise, bringing out the moves and motives of Digital Leaders.

Fellow Enterprise Irregular and a great friend Vinnie Mirchandani has narrated this impressive book due for release shortly. Vinnie shared an author copy of the book weeks back and I was so impressed by the book - read and reread the book and I feel good sharing my thoughts on the book – topic and details therein.

The present era of business is seeing lot of excitement and promise all around. Around the world, every day in our lives bring lot of changes – fast, unpredictable and may times we have to struggle hard to understand what the change stands for. Globalization, technology has transformed the playing fields across continents, industries and sectors. Very powerful forces of change have shaken the beliefs in many aspects of governance and social thinking. Fortune 500 companies list is changing faster than the fast pace that we have seen in the past. Powerful brands have suffered huge damages and many industries have gotten transformed substantially so much so that many successful leaders today claim their business need to adapt and transform faster than ever. Leading edge corporations run faster in this direction to ensure that their rate of change inside is ahead of the change seen in their external environments. Looking at these developments, it’s clear that the time to re-imagine the future is now, and it is best done by a fresh school of thought that governs our thinking frameworks to enable a fundamental rethink and envision what is desirable and sustainable. It’s in this context that this book and the examples therein make such a powerful effect.

Karl-Heinz Streibich in the opening chapter makes a passionate plea as to why every enterprise should become a digital enterprise. He points out that for several decades IT was used to make business operations efficient and over time felt the need to create systems of differentiation, typically achieved by integrating the enterprise and extending the integration to its ecosystem thereby reducing the barriers to conduct business.More recently, we see leading edge enterprises around the world focus on creating systems for competitive advantage by embracing digitization. Such enterprises, Karl-Heinz points out are embedding technology in their products and services, moving to technology - enabled business models and utilizing technologies to redefine business models and utilizing technology to redefine their distribution channels. And Karl-Heinz emphasizes that this happens in every industry. All IT products are today becoming digital products leveraging the technology growth from internet to data explosion to in-memory computing, big data, digital collaboration platforms and business process management. The entire chain of data generation, data analysis, data based decision making are enabled through digitization and with collaboration and machine-to-machine communications, enterprises gets enhanced power to execute business processes with unprecedented speed and insight, in real time. With the proliferation of cloud technologies, scale out and scale ups of digital programs are becoming an easy option to exercise for most to the enterprises and the journey of IT products to digital products happen rapidly, a phenomenon well exploited by leaders in unique ways across industries.

Focused on enterprise class innovation, the book is littered with powerful showcases – 22 guest perspectives and more than 300 innovation cameos representing more than 20 industries in more than 25 countries – end of reading the book, one gets the feeling of having gone around the world - for a change, across planets. Its magnitude and range is really wide and deep. The range of themes extend from creating smarter products to inventing new go-to-market models to transforming your value chain to reexamining your stakeholders and there are many more that I have not included herein .

Some cases therein:

- Coca Cola Enterprises talks about mobility and crowd sourcing being brought together to create new industry frameworks to monitor inventory, shape merchandizing and improve service levels, while increasing operational efficiencies.

- Nissan talks about how by Steering –By- Wire, an aviation feature is brought onto their Infiniti range of vehicles

- A Spanish Auto Insurer shares how satellite technology leverage is transforming their Insurance industry

- Deutsche Telecom talks about how it is transforming itself from a pure communication provider into a new future centric business with innovative offerings

- Siemens AG highlights how Germany’s concept of “Industrie 4.0”leveraging continuing transformations of the internet into a network that lets objects, devices, machines and systems communicating with one another driving fundamental changes and how this could lead to the integration of digital and real worlds on a Digital Enterprise Platform.

- Dr Henning Kagermann, former CEO of SAP and currently president of Acatech, the German National Academy of Science & Engineering talks about how more stakeholders are influenced by technology than in the past and how digital enterprises would need to factor in a much wider set of stakeholders.

The exhaustive cases mostly presented by the enterprises directly make deep impact and helps visualize a variety of possibilities. The best part is that these do not necessarily come from the Silicon Valley, where I live but from industries located across the developed world. These Main Street logo’s are indeed taking “digital” to a whole new level – way, way beyond the plain interplay of social, mobile, analytic and cloud computing.

Marc Benioff in his brilliant preface to the book brings out the point that digitization helps the enterprises to get closer to the customers and are redesigning the future of business. He talks about how GE ‘s GEnx engine –currently flying on Boeing’s new 787 Dreamliner is a connected product that provides real time data about engine performance from both GE and the airline customers to communities of service technicians. Service teams on the ground can access the data while the plane is still air-borne , facilitating a new range of services .Philips , Toyota are all leveraging unique models of digitization to serve their customers better/enable new lines of business for them.

The magnitude of this becomes apparent when a top GE executive writes in the book that in a few years from now 50 billion devices could get interconnected, making giant strides in remote monitoring , self-healing etc. , thereby improving the overall quality of business. These trends will provide for massive paybacks and GE sees US$15 trillion added to global GDP in the next 15 years. That’s the approximate size of US economy today! How can enterprises start their digital journey is a natural question in the mind of everyone reading this – the book promises that any enterprise can master the challenge of reinventing itself as a digital enterprise, The concept of “Digital Babies” Digital Natives” and Digital Phoenixes” provide a context to check an enterprise’s digital journey. The Digital enterprises, the book closes by arguing have to be continuously thinking about their “Next Big Thing”. With increasing customer expectations, competition catching on capabilities faster, ever evolving industry standards and government regulations The pace of technological progress is relentless and the resultant digital enterprise landscape in future will look very different from what it’s today and claimants to the future need to start their journey today and pace up.. or will run the risk of getting grounded fast.

Though a lot of attention these days seems to go to innovation in mobile and social technologies, plenty of complex, hairy “industrial innovation” is also going on. This is encouraging because we face a daunting series of challenges at the global, enterprise, and individual level. We need winners leveraging digital forces and come out successfully to help deal with a range of challenges – big and small, of various size and structures and across geographies. Let's looks at the new business that are shaping many emerging industries - The successful enterprises spanning established corporations to upcoming start-ups—are creating incredible value by succeeding in a new way: by bringing together various streams of technology to create new form of processes, products and services to create value . These are the poster child of digital enterprise success.

The key learning’s for me out of reading the book is the need to completely re-visualize the possibilities by becoming a digital enterprise. That calls for going beyond creating revenue .by mere digital substitution. A digital strategy that focuses on specific business outcomes leveraging various forms of digital technologies can create an edge for the enterprise. It must be noted that a sustainable edge comes in where the inane physical resources mutate with the vibrant digital information to create new value. Winners in doing this get there by thinking big and small together transforming processes, creating/validating/rebooting business models and enabling new waves of customer experience. Any company large or small, old or new can use this digital technology to create a winning edge for its business and perhaps, its industry.

What I see in the book,The Digital Enterprise are a rich set of examples and metaphors that talk the story of entrepreneurs, business leaders, and multinational companies innovatively leveraging technology to tackle big problems, “grand challenges,” In their own ways, these big and small enterprises in their spheres of influence are reshaping the world

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