Now that the media hype of 2013 has settled . . . somewhat, 2014 will be a pivotal year in which we see small, tangible steps towards reality. Below are a few trends and commentary on what we’re seeing in the market:
1. Ecosystem components begin to marry. Investments, acquisitions, partnerships, and new developments will focus around unifying printers, software, and services for seamless 3D printing experiences. For example, Adobe recently announced direct integration with MakerBot and Shapeways to close the gap between 3D modeling tools and what printers need to physically produce objects. Other major software vendors like Autodesk will play an evangelist role in bringing ecosystem players together to enable interoperability across proprietary platforms.
2. New startups stretch our imaginations of business model disruption. 3D printing is a catalyst for rethinking inefficient analog processes. Startup SOLS aims to disrupt the entire orthotics value chain with an end-to-end digital service for custom shoe insoles. Customers scan a 3D model of their feet, input data on weight, lifestyle, and activity patterns, and send to print.
According to recent Business Technographics data, half of US enterprise technology management professionals report that there is 1.) no way to gain a single view of status and availability across their portfolio of cloud services, 2.) that they don’t have a clear way to assess the risk of using a third-party public as-a-service offering, and/or 3.) that they have no way to manage how providers handle their data.
An interesting debate is ensuing regarding how to best protect cloud data, given the market landscape. So far two modalities are emerging:
·A. Inserting in-line encryption between the enterprise and the SaaS provider that encrypts and/or tokenizes all data before it goes to the cloud to ensure safety interoperating within public cloud systems.
·B. The human-firewall model, in which IT closely monitors activity with context/content analytics and anomaly detection tools.
The truth lies somewhere between the two. By carefully applying Forrester’s data security and control framework, clients should incrementally encrypt data deemed sensitive to compliance or regulation, such as credit card and Social Security numbers, and closely monitor all activity across users and cloud applications.
So you need some work done that you’ve never had done before or you need to buy something you’ve never bought before. What should you pay? That can be a tough question. What seems reasonable? Sometimes we set arbitrary rules. It’s OK if it’s under $50 or under $100. But that’s just a reassurance that you’re not getting ripped off too badly. Certainly the best way to avoid that outcome is to know how much that service or thing is worth, or at least know what others have paid for the same thing.
Fortunately now, in the age of the customer, that’s easier to find out. Price information for most consumer goods is easier to come by, making the buying process more efficient. But what about governments? We’ve all heard about the $600 toilet seat or the $400 hammer. Stories of government spending excess and mismanagement abound. Some are urban legends or misrepresentations. Others have legs — such as the recent reports of Boeing overcharging the US Army. While these incidents are likely not things of the past, open data initiatives have made significant progress in exposing spending data and improving transparency. Citizens can visit sites such as USAspending.gov for US federal government spending or "Where Does My Money Go?" for details on UK national government spending, and most large cities publish spending as well.
Macro trends in technology and shifting customer behavior are giving rise to the connected business — which is not defined by technology but is rather a new style of doing business. CIOs will be responsible for introducing technology solutions that help break down silos, boost cross-team collaboration, drive the end-to-end customer experience, and engage more deeply with customers. In order to succeed, CIOs must go beyond technology enablement and support organizational and cultural transformation.
With Jeroen Tas, one of the most renowned technology visionaries in Europe, as its CIO, Philips made a number of strategic decisions to transform itself into a connected business. Forrester believes that CIOs should familiarize themselves with Philips’ strategic, operational, and cultural transformation and learn from it, as Philips offers CIOs valuable lessons in planning the transition to a connected business:
Philips embraces digital propositions at the expense of standalone products. Philips maps out customer journeys and ensures that its products turn into plug-ins for broader digital propositions. The firm connects all of its propositions through data, communities, and collaboration, allowing it to understand who the customers are and how they use products. Philips decides how it needs to develop its portfolio based on these customer journey maps, opening up new business models.
Interdisciplinary teams help open up new revenue streams. The old model — all marketing people sitting together, all IT people sitting together, all supply-chain people sitting together — is outdated. Interdisciplinary teams force people to speak each other’s language. At Philips, interdisciplinary teams have also resulted in much higher job satisfaction.
- Office should be on any device or web site that customers are using to get work done. See my colleague Phillip Karcher's take on Office for iPad.
- the cloud service platform (OneDrive, Office 365, and Azure), not the operating system (Windows), is now the focus of the platforms wars.
I'd like to elaborate on the second point. The measure of a person's commitment to a particular platform or ecosystems should be the user accounts that they have, the content they store in those cloud service, and whom they trust with stored credit cards. So you can't tell if someone is an Apple customer just because they use an iPhone - you have to look inside the device to see who's apps they use most, and what cloud services they use. Many iOS customers are in fact more involved with the Google digital platform than they are with Apple's and many Android customers have little to no engagement with Google because they use the apps and services that the device maker or service provider put on their home screen. Microsoft's challenge is to get more customers engaged on their digital platform - using Outlook.com email, OneDrive for file storage, and Office 365 for productivity. So Microsoft can win in the digital platform, regardless of who's operating system is on the device.
Today Microsoft starts shipping Office for iPad, finally plugging the gap in its portfolio that’s been filled by popular document viewers and editors like QuickOffice and SlideShark.
Does this come too late for Microsoft?
As much as naysayers like to proclaim Office is dying, people still overwhelmingly use it at home and at work. Office is supported at virtually every organization. Our survey of Forrester clients at the end of last year showed strong strides by Google Docs with 13% of firms using it.* However, the caveat is companies that have gone Google are using Docs to complement Office with collaboration features and mobile support, not to replace it.
You could argue how much incremental revenue Microsoft lost out on, but I don’t think the lack of native Office apps has caused Microsoft to cede ground to other office productivity suites on the PC, where the vast majority of content is still created. Keep in mind that out of the 20% of information workers in North America and Europe that use a tablet for work, 60% of them use some office productivity software on it.** Half of tablets used for work are iPads. So immediately just 6% of information workers will be considering the Office apps as an alternative to what they are using on their tablets today.
Usually when a product or service shouts about its low pricing, that’s a bad thing but in Google’s case there’s unique value in its Sustained-use Discounts program which just might make it worth your consideration.
In my last post I outlined the research we just finished on digital transformation. Today I'd like to highlight the key takeaways for CIOs.
CIOs are destined to play a pivotal leadership role in the transformation of business to a digital business. The nature of business is changing and, in turn, the technology investment priorities of the past must change. The report - Unleash Your Digital Business - describes the dynamic ecosystems of value that drive customer behaviors and transform the linear value chain into a dynamic network supported by open APIs. CIOs must partner with CMOs to drive the business transformation needed to become a digital business. To survive, your business will need to embrace digital customer experiences within ecosystems of value, and digital operational excellence to drive the agility and innovation required to survive and thrive in the age of the customer.
Digital Is More Than A Bolt-on Strategy
Bolt-on digital is like painting go-fast stripes on a car; it doesn’t change the underlying business. To become a digital business requires fundamental enterprise transformation; something CIOs are accustomed to leading and shaping. The partnership with the CMO must be extended to create operational excellence through digital technology, augmenting customer value with digital products and services and driving rapid innovation across the business.
Dynamic Ecosystems Of Value Drive The Ability To Win Serve and Retain Customers
Your company is likely to face an extinction event in the next 10 years. And while you may see it coming, you may not have enough time to save your company.
Business leaders don't think of digital as central to their business because in the past, it hasn't been. But now your customers, your products, your business operations, and your competitors are fundamentally digital. While 74% of business executives say their company has a digital strategy, only 15% believe that their company has the skills and capabilities to execute on that strategy (see figure). These are just some of the findings from our latest research (Forrester clients click here).
For the past few years, companies have been bolting “digital” onto their existing business like teens paint go-fast stripes onto their cars. “Look, we’re digital” is the message CEOs want to send to investors. But the piecemeal strategy of bolting digital channels or methods onto the business is no longer sufficient. Instead, you must think of your company as part of a dynamic ecosystem of value that connects digital resources inside and outside the company to create value for customers. To do this, you must fully harness digital technologies, both to deliver a superior customer experience and to drive the agility and operational efficiency you need to stay competitive.