The Industrial Revolution has changed our way of life. It has impacted everybody and upset societal hierarchies, changed business and overthrown governments. Industries rose from water power, turned to steam power and then got hooked up to electricity. Now the next wave of innovation is replacing the old industrial infrastructure. New technologies change the way we interact with our customers, produce products and supply services. Technologies like:
- Big data
- The Industrial Internet
- Internet of Things (IoT)
- Digital fabrication like 3D printing
- Machine Learning and Artificial Intelligence (AI)
These technologies power each other, so the pace of the change is increasing exponentially. Change creates new and exciting opportunities but also significant risks for your business. As a CEO or senior manager, how do you ensure your company will be leading this new revolution, instead of being one of its victims?
1. Give your business model a makeover
Admit it, we’ve all seen those makeover shows. Some person who is not taking care of themselves and this neglect is negatively affecting their life. They can’t get a date or a good job. First they are hesitant about the makeover, the change and getting out of their comfort zone but afterwards, they always seem to feel better. Did you know this happens to many businesses too?
Companies get into a comfort zone and stop innovating. They’ve been making money with a particular business model for years, so why change? But, to stay ahead of the curve, you want your business to take advantage of new technology and the opportunities it brings. It’s time to invest in your future. Companies that wait too long will fail and fall.
Kodak underestimated the rise of the digital camera and was scared to let go of its old moneymaker, the film roll. Kodak filed for bankruptcy in 2012. Don’t be the next Kodak.
Start investing seriously in your R&D department and big data capabilities to discover what your customer needs before they, or your competitors, know it. Don’t be afraid to cut back on business units that are soon to be outdated.
2. Get your strategy on the platform.
The platform is the new value chain. Platforms bring customers and suppliers together into a new ecosystem. Like Apple with its iOS mobile operating system and all its apps. The question is not if you will participate, but how. What options are available to you?
- Be the platform builder and bring customers, services, and products together.
- Take a customer-centered approach by providing products and services on the platform
- Develop new technology for the customer-centered users and the platform builders to enhance their business
If you decide to create your own platform, you always need to follow these 4 steps:
- Digitize your business
- Keep on improving your data, technology and customer experience
- Always looks for ways to decrease costs while increasing service.
- Go back to step 1 and start doing the same thing again.
It is a circle that never ends if you want your company to be a leader and beat out the competition.
3. Become a tech nerd
For your company to become a forerunner in digital technology, you, of course, need to onboard people with the right software skills. But don’t stop there. Make sure all your employees learn to understand technology and thus to recognize the opportunities it brings. For example, train your shopkeeper how to collect useful data from customers by asking the right questions. This data, in turn, will power your machine learning skills.
Share your data openly with your whole company. Create an office environment where people can learn, share and discuss data with people from other departments. Make your business a place to learn, teach and discover continuously. This way, your employees will more easily recognize new patterns in customer behavior and make discoveries for further innovation. Always be open to test new ideas within your company.
4. Be open to innovate together
To be a leader in the digital revolution, you need to innovate. Step 3 lays the groundwork for this. But also look to work together outside of your company. Ecosystems and platforms bring new integrated ways of collaborating across sectors. The Industrial Internet connects a broad group of organizations, which all have a stake in its success. Bigger companies are partnering up with small start-ups, or even former competitors, to innovate. Don’t be left out.
Put your customer first
Whatever you do, never forget that your customer drives your company. With the rise of new technology, like the Industrial Internet and data analytics, you now have opportunities like never before to become perfectly attuned to the desires of your customer. Discover their habits, interests, and passions. Understand your customer, give them what they want, and you’ll gain their loyalty.
5. Innovate your finance
Innovation, changing or upgrading your technology isn’t for free. It will require investments and new ways of financing. Look for venture capital. Before, this was the almost exclusive territory of the Silicon Valley tech companies. But innovative industrial firms are starting to discover the opportunities of venture capital and vice versa.
Consumers increasingly use a shared fleet as an alternative to buying a car, as the latter immediately loses value when you buy it. You can use this same concept by adopting a pay-as-you-go strategy for services where you can, instead of investing in costly ownership.
Don’t forget to optimize your payment systems. Data is very useful to make your financial instruments more reliable and predictive. Gain new insights on your short- and long-term returns and your cash flows. Find new ways for processing payments. Blockchain technologies are changing the face of finance, find out how you can take advantage of these.
6. Be real
Be sincere in what you do and what your purpose as a company is. Believe in it and make sure your employees do as well. For example, if you say you care about the environment, truly act on it and don’t greenwash. Not only is this not very ethical, but nowadays news travels fast via social media, and your customers will find out. Once you lose your customers trust, they won’t come back and will go to your competitor instead. So, get real.
7. Be trustworthy with data
Data is the currency of the internet. Users don’t pay with real money for services like Facebook, Gmail, Instagram or Snapchat, but with their data. Sadly, many companies are not transparent how they use and sell this data to third parties. Recently there has been a lot of news about Facebook and the unauthorized use of its user’s information by Cambridge Analytica. It shed light on some controversial ways in which Facebook uses it’s customer’s data.
Don’t be like this. Make sure your customer knows what you do with its data and how you protect it. Your customer trusts you, don’t ruin this.
8. Become a leader
Let’s get your company in shape to become the leader of the revolution and create a new business champion. Contact us now.