The New Digital Battlefields
In the popular TV show, Game of Thrones, the denizens of the North often repeat the mantra, “Winter is coming” to remind themselves and others that they must continually prepare for the challenges ahead.
Managers also have a mantra, “the future is coming.” Some do it to warn of obsolescence, while others do it to promote their new idea. Much like the “Winter,” the future is always vague, promising unforeseen events that are devilishly hard to prepare for in any concrete way.
In a previous post about managing the skills gap, I argued that the best way to prepare for the future is to identify specific platforms—combinations of technologies and markets—that will enable your enterprise to compete. To follow-up, I spoke to some of the smartest people in technology about the platforms that will impact business in the years to come.
Machines That Learn
Computing has long been central to how enterprises function. Machines that perform billions of calculations per second have proven themselves incredibly useful in performing rote tasks that require the processing of information in bulk. While humans get tired and make errors, machines just keep plugging away.
Yet we are now entering a new world of cognitive computing, in which artificial intelligence combines with big data to work with not just hard facts, but ambiguities. As Bernie Meyerson, Chief Innovation Officer at IBM told me, “these systems learn. Even if you expose the system to unfiltered information, the system learns to filter the information.”
This shift is truly revolutionary. While Watson has made headlines for winning at Jeopardy and going to medical school, IBM is working on new technologies such as SyNAPSE chips that will transform computing architecture into something more like the human brain, which Meyerson notes are thousands of times more efficient than microprocessors.
Although the potential of these new capabilities is staggering in itself, Meyerson also stresses that cognitive computing represents a “huge management challenge.” He says that managers need to “encourage and enable the merger of human capabilities and those that machines are just beginning to acquire.”
As Brynjolfsson and McAfee have put it, this isn’t a race against the machines, we need to learn to race with machines. And that will require new ways of working that we are just beginning to understand.
The Internet of Things
While learning machines are changing what computers can do, the Internet of Things (IoT) is expanding their reach to physical objects, such as smart phones, smart cars, smart homes and a plethora of new smart appliances. The potential here is so enormous that Google recently bought Nest, a company that makes smart thermostats, for $3.2 billion.
Rishad Tobaccowala, Chairman of Razorfish and DigitasLBi calls the Internet of Things “mobile on steroids” and says that “just as mobile has changed society and business globally, over the next decade, IoT will change healthcare, transportation, retail and much more.” He believes that it will force firms to rethink “every touchpoint” of their business.
However, it’s important to realize that IOT is essentially a collaborative technology, forcing firms to not only rethink their products, but their entire business model, transforming how they create, deliver and capture value. As Aaron Dignan of Undercurrent put it, “A smart light bulb is a completely different business than a regular light bulb.”
This, he says, requires managers to take a more “systemic attitude.” Nest, for example, became a market leader by completely reimagining not only the function of the thermostat, but how we interact with them. Still, in the future, it expects to earn the bulk of its profits not by selling products to consumers, but the data it generates back to power companies.
Clearly, atoms are becoming the new bits. That’s a big shift.
Marketing has historically been a fairly sleepy affair, more craft than science. Marketers prided themselves on being the soul of the brand, not on their technical or analytical acumen. Over the past decade, however, that’s changed dramatically and now Gartner predicts that by 2017, CMO’s will spend more on technology than CIO’s.
No one is more at the center of this transformation than Scott Brinker, the CTO and cofounder of Ion Interactive who hosts the Chief Marketing Technologist blog. He recently co-authored an article in Harvard Business Review in which he asserted that, “marketing is rapidly becoming one of the most technology-dependent functions in business.”
Yet he sees the challenges that marketers face as not inherently technological, but human. Marketers need to not only sort through over 1000 marketing software providers worldwide, but also manage technical interfaces with agencies and other partners and still perform traditional marketing functions. It’s a profound integrational challenge.
That’s why he has been advocating for firms to focus on hiring marketing technology specialists in order to bridge the marketing and technology worlds, but even he doesn’t think that’s enough. He also stresses that marketing departments themselves need to learn new skills and adopt agile marketing practices to function in real-time environments.
Digital technology’s ability to distribute information has transformed human experience. It used to be that knowledge was a privilege, contained in private libraries and elite universities, but today even some of the world’s poorest people have better access to information than first rate scholars did in the past. This is revolutionizing education.
Top universities are offering massive open online courses (MOOC’s) on platforms like Udacity and Coursera. IBM recently partnered with Georgia’s largest school system to create transformative classrooms powered by digital technology. UC Berkeley’s new Data Science Masters program is offered to executives exclusively online.
Yet for all of the wonders of technology, education is, at its core, an interaction between a teacher and a student. It’s not a mere matter of posting videos and issuing online tests. As James Kenigsberg, the Chief Technology Officer at 2U, a firm that helps universities to create online programs, told me, faculty needs to relearn how to teach online.
He points out that “online, there is no back row” and that means that both teachers and students need to use social tools and collaborative assignments in addition to live classes in order to constantly engage throughout the entire educational experience, rather than just during lectures and office hours.
You can have the best technology in the world, but learning remains an essentially human endeavor.
The New Age of Ecosystems
In 1990, C.K. Prahalad and Gary Hamel published an influential article in Harvard Business Review called The Core Competence of the Corporation in which they urged managers to identify a few crucial areas in which they could excel. That, they insisted, was the key to outperforming competitors.
The concept helped fuel the shift from vertical integration to outsourcing of non-core capabilities. Firms became more focused, lean and efficient. Yet they also became more isolated and vulnerable to disruption. By focusing on what they knew well, enterprises often became oblivious to what they did not.
The problem is even more pervasive today because we compete not so much within the boundaries of industries, but amid a network of ecosystems. Competition today can come from anywhere and old competencies are often undermined by new technologies. The adoption of capabilities in one area often requires new skills in another.
No technology is an island and that is why most enterprises will not be able to adapt to the new digital battlefields—such as the ones listed above and others too—because adopting new skills today takes more than just hiring and procurement. It requires, as Dignan put it, systemic thinking, where the whole is made up of many disparate parts.