Enterprises of the future must be as nimble as consumers are unpredictable and effort-adverse
Industrial and economic development are inexorably linked, and have been throughout history.
Humble cottage industries slowly gave way to machine-powered factories. Online storefronts now threaten shopping malls. Communities and countries have enjoyed the economic fruits of enterprise while wealth and influence in business has shifted from the merchant and his family to the industrialist and his town, from the CEO and his board to the startup owner and his colleagues.
What hasn’t changed is the power held by the consumer, and the impact technology has had on business.
As we enter the Third Internet Era that promises a global digital economy, enterprises have a unique opportunity to leverage knowledge of their customers and their investment in technology so that they stay profitable in a time of socio-political-economic flux.
Supply is not equal to demand
The adage says that ‘supply equals demand’. In years to come we may see this amended to ‘demand determines supply’.
Efficient transport networks and then globalisation and the Internet have made supply ubiquitous. This means that supply is commodified and companies chase demand where consumers once chased supply. The business-consumer relationship has shifted fundamentally, leading to seismic effects on product development, logistics and customer service.
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Tomorrow's consumers are more likely to spend their money with companies that enable them to buy and consume wherever and whenever - online, on-demand, and via ‘do-it-myself’ platforms. The buying behaviour of millennials indicates the start of this trend, which will become the norm as the ‘tech-first’ consumer pool increases.
Enterprises of the future must therefore be as nimble as consumers are unpredictable and effort-adverse.
Technology may have prompted this shift but it also offers opportunities and solutions. The company that embraces digital offerings, platforms and commerce creates the means to gather information on its customers.
Demographic, behavioural and purchasing data may all contribute to providing consumers what they want – where and how they want it – almost before they know that they do. In markets as diverse as South Africa’s private and public sectors, technology provides scope to service niche demand in a manner that isn’t yet possible.
The untethered enterprise
There are a surprising number of companies still in existence after centuries, such as the Jim Beam distillery (established in 1795) or locally, Old Mutual (est. 1845). Most of today’s corporates will not enjoy similar longevity.
This is not necessarily a bad thing. After all, very few enterprises can stay relevant over decades maintaining their original offering and means of doing business. Jim Beam markets more than 10 different products now, and they make use of more than one social platform.
Innovation – enabled by key ICT technologies like the cloud and software-defined networking, and business intelligence – inevitably leads to reinvention, and embracing relative transience and dynamism is critical to the success of enterprises in the future.
Companies that welcome virtualisation are untethered from physical assets and infrastructure. They are not limited to targeting the consumers in their geography, or to employing staff residing nearby. They can draw on a diverse talent pool, and can concentrate on expansion to new markets with tailored business offerings – outsourcing non-core operational functions and retaining key skills essential to intellectual property.
Rapidly scaling up and importantly, scaling down again as consumer demand shifts business priority, is in the reach of the dynamic, liberated enterprise.
From dynamism comes the need to automate, because manual processes cannot compete with digital information gathering, storage and analysis, or customer servicing.
To an extent, enterprises are already virtualising and automating marketing and sales-related communication and customer query management. Simplistic examples include newsletter sign-up prompts and on-site conversation apps like Drift, used by YuppieChef, or ZenDesk, used by LeadHome.
Imagine foregoing the need to speak to a stranger in a call centre because the service platform offered by your ISP, health insurer or investment manager has intuited that your current service is no longer appropriate. The platform suggests alternatives and with a few clicks, your contract is updated. By the way, your provider is in Germany, because they offered better rates than any alternative. Compare this to the current process of upgrading a bank account or opening a new investment.
When ubiquitous connectivity serves customer experience through optimised business processes, the result is a consumer-centric, personalised, agile, forward-thinking enterprise.
As an Internet integrator, Internet Solutions is thinking about how we can virtualise service management and offer greater assurance to clients through self-healing networks. Software-defined networking capability at the core and the edge of networks means resilience built into network architecture automatically. We’re investing in IoT to enable gathering of meaningful ‘small data’.
Yuppiechef and LeadHome are not the only South African companies using available technologies to make customer engagement more systematic. There are many examples of local enterprises quietly innovating, disrupting their own processes and in so doing, future-proofing their customer base and profits.
They may not be around in 200-odd years like Jim Beam, but they may well still be in business in twenty.