Welcome!

Blog Feed Post

Technology Isn’t the Answer to Surviving Digital Disruption

Despite the rhetoric, executing a digital transformation is not about becoming a tech company. It’s about making technology so ubiquitous that it becomes invisible.

There’s a funny thing about digital transformation: we are simultaneously over-hyping it and understating it. On the one hand, every tech company in the world is talking about it. It doesn’t matter how mundane the technology; every company is somehow relating their products to digital transformation.

wrongwayhttps://intellyx.com/wp-content/uploads/2016/11/wrongway-768x541.jpg 768w, https://intellyx.com/wp-content/uploads/2016/11/wrongway-1024x721.jpg 1024w, https://intellyx.com/wp-content/uploads/2016/11/wrongway-207x146.jpg 207w, https://intellyx.com/wp-content/uploads/2016/11/wrongway-50x35.jpg 50w, https://intellyx.com/wp-content/uploads/2016/11/wrongway-600x422.jpg 600w, https://intellyx.com/wp-content/uploads/2016/11/wrongway.jpg 1432w" sizes="(max-width: 300px) 100vw, 300px" />On the other, many people are failing to grasp the import and impact of what digital transformation really means. In far too many cases, business and IT leaders are dismissing it as nothing more than a marketing ploy. The unfortunate result is that the over-hypedness of digital transformation is obscuring its real meaning.

This dichotomy is most apparent in what I call the tech company fallacy.

Everywhere I turn, I hear another company executive make a proclamation that they are no longer a retailer, a toy manufacturer or whatever kind of company they are — and then say, “We’re a tech company that happens to <<insert product or service here>>.” Ugh.

On one level, it’s understandable. Transforming an organization — particularly a large enterprise — is tough work. You need to jolt people out of their comfort zone and create enough urgency that they are willing to forgo the security of “the way things have always been done” to embrace the uncertainty of new.

The rallying cry of digital transformation is an easy foil for this purpose. But it’s also a trap.

The Tech Company Trap

I blame Amazon for creating this phenomenon. They launched as an “online bookstore” — and most people took them at face value. As Amazon began expanding into other product lines and their dominance became clear, people realized that they were much more than just an online bookstore or even an online retailer — they were a tech company!

Amazon’s eventual move into cloud computing with the Amazon Web Services (AWS) platform cemented this notion that they were a tech company who happened to sell stuff. The problem is that Amazon has always been a tech company.

Jeff Bezos started Amazon as an internet company in search of something to sell. He settled on books for very pragmatic reasons, but make no mistake — as much as Google or Apple, Amazon has always been a tech company.

This distinction is not insignificant. A tech company is one in which technology is the product they sell. In the case of Amazon, their real product is their cloud computing platform and the e-commerce platform they ‘sell’ to third parties who use it to sell their goods.

Companies like Uber and Airbnb have further muddied the water. Industry pundits love to hold them out as shining examples of the tech company ethos that enterprise organizations must emulate — but should you?

Failing to Find the Real Transformation Story

As Intellyx president Jason Bloomberg discussed in his Forbes article, Top Five Enterprise Digital Mistakes, Uber and Airbnb have become poster children of the digital era mostly because they viscerally represent the threat of disruption to well established industries. “Wake up or you will be Uberized next!” cries the call to action.

Unquestionably, Uber and Airbnb operate like technology companies. They deliver a technology platform that disintermediates industries that were otherwise difficult to coalesce into a single addressable market. They removed inefficiency, provided simplified access to an otherwise dispersed set of assets and thus created a centralized market where one did not exist.

There are certainly other industries where these circumstances exist, but let’s be clear: the whole world will not be Uberized.

As evidence of the new world order, pundits love to point out that Airbnb now has more rooms available than the largest hotel providers — yet they own no property. Recent analysis, however, shows that only approximately 43% of Airbnb listings are actually competitive to hotels. Moreover, Airbnb most likely represents no more than 15% of all rooms available worldwide — and probably much less.

There is already evidence that Airbnb’s growth is cooling. This fact isn’t surprising when you consider that there is a significant difference in the customer experience that Airbnb delivers versus that of a full-service hotel.

Airbnb, Uber and other paragons of the sharing economy are powerful examples that the digital era enables entirely new technology-powered customer experiences — but that is not the real digital transformation story.

The Goal: The Ubiquity & Transparency of Technology

It is easy for the promise of Uber and Airbnb to seduce — and frighten — business executives. It makes sense that they will use the tech company ethos as a rallying cry to inspire a transformational effort.

The problem, however, is that it puts the focus on the wrong thing — the technology — and surrenders their greatest potential competitive advantage: customer intimacy.

Most traditional enterprise organizations have risen to prominence based on their ability to connect with their customer’s needs and desires. They should not suddenly abandon their rich history and recast themselves as tech companies.

In fact, they should do the opposite. Traditional enterprises must embrace their heritage, but see themselves in terms of the value they provide and the relationships they have with their customers — rather than the products they produce or the services they deliver.

The goal is not to become a tech company. The goal must be to embed technology so ubiquitously and so deeply within the culture and operating model of the company that it becomes transparent — allowing you to enhance the customer experience and deepen your relationships.

The challenge is that most traditional organizations have a self-view that is essentially synonymous with the product they sell or the service they provide. The required shift is not to become a tech company, but rather to make the organization synonymous with the value they provide and the relationship they create. The organization can only re-envision its business model from that perspective.

The real goal of digital transformation, therefore, is to leverage technology to reshape and enhance the value you deliver to your customers. Whether it leads to an entirely new business model or simply a better, technology-enhanced version of your existing one is immaterial. The objective is that technology becomes invisible to allow you to focus on how to create greater value for your customers.

The Intellyx Take

Calling yourself a tech company is expedient — but it is also misguided. In the digital era, every company that survives will have technology at the core of its business and operating model.

Business executives must lead the digital transformation of their organizations and be willing to re-envision how they operate on every level in order to remain relevant. But simply calling yourself a tech company will not be enough and is much more likely to demoralize your team rather than motivate them.

You must instead create a vision of something entirely new: a vision of your company that is exciting, modern and that feels at home in the future, but that respects your organization’s storied history and deep customer relationships.

You must culturally and structurally transform your organization to compete in the digital era. You must embed technology and the digital ethos into the very core or your operating model. But you must also never forget that it is your unique ability to serve your customers that has been and will remain the driver of your success.

Copyright © Intellyx LLC. Intellyx publishes the Agile Digital Transformation Roadmap poster, advises companies on their digital transformation initiatives, and helps vendors communicate their agility stories. As of the time of writing, none of the organizations mentioned in this article are Intellyx customers.

Read the original blog entry...

More Stories By Jason Bloomberg

Jason Bloomberg is the leading expert on architecting agility for the enterprise. As president of Intellyx, Mr. Bloomberg brings his years of thought leadership in the areas of Cloud Computing, Enterprise Architecture, and Service-Oriented Architecture to a global clientele of business executives, architects, software vendors, and Cloud service providers looking to achieve technology-enabled business agility across their organizations and for their customers. His latest book, The Agile Architecture Revolution (John Wiley & Sons, 2013), sets the stage for Mr. Bloomberg’s groundbreaking Agile Architecture vision.

Mr. Bloomberg is perhaps best known for his twelve years at ZapThink, where he created and delivered the Licensed ZapThink Architect (LZA) SOA course and associated credential, certifying over 1,700 professionals worldwide. He is one of the original Managing Partners of ZapThink LLC, the leading SOA advisory and analysis firm, which was acquired by Dovel Technologies in 2011. He now runs the successor to the LZA program, the Bloomberg Agile Architecture Course, around the world.

Mr. Bloomberg is a frequent conference speaker and prolific writer. He has published over 500 articles, spoken at over 300 conferences, Webinars, and other events, and has been quoted in the press over 1,400 times as the leading expert on agile approaches to architecture in the enterprise.

Mr. Bloomberg’s previous book, Service Orient or Be Doomed! How Service Orientation Will Change Your Business (John Wiley & Sons, 2006, coauthored with Ron Schmelzer), is recognized as the leading business book on Service Orientation. He also co-authored the books XML and Web Services Unleashed (SAMS Publishing, 2002), and Web Page Scripting Techniques (Hayden Books, 1996).

Prior to ZapThink, Mr. Bloomberg built a diverse background in eBusiness technology management and industry analysis, including serving as a senior analyst in IDC’s eBusiness Advisory group, as well as holding eBusiness management positions at USWeb/CKS (later marchFIRST) and WaveBend Solutions (now Hitachi Consulting).

Latest Stories
SYS-CON Events announced today that Datanami has been named “Media Sponsor” of SYS-CON's 21st International Cloud Expo, which will take place on Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. Datanami is a communication channel dedicated to providing insight, analysis and up-to-the-minute information about emerging trends and solutions in Big Data. The publication sheds light on all cutting-edge technologies including networking, storage and applications, and the...
After more than five years of DevOps, definitions are evolving, boundaries are expanding, ‘unicorns’ are no longer rare, enterprises are on board, and pundits are moving on. Can we now look at an evolution of DevOps? Should we? Is the foundation of DevOps ‘done’, or is there still too much left to do? What is mature, and what is still missing? What does the next 5 years of DevOps look like? In this Power Panel at DevOps Summit, moderated by DevOps Summit Conference Chair Andi Mann, panelists loo...
SYS-CON Events announced today that EnterpriseTech has been named “Media Sponsor” of SYS-CON's 21st International Cloud Expo, which will take place on Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. EnterpriseTech is a professional resource for news and intelligence covering the migration of high-end technologies into the enterprise and business-IT industry, with a special focus on high-tech solutions in new product development, workload management, increased effi...
You know you need the cloud, but you’re hesitant to simply dump everything at Amazon since you know that not all workloads are suitable for cloud. You know that you want the kind of ease of use and scalability that you get with public cloud, but your applications are architected in a way that makes the public cloud a non-starter. You’re looking at private cloud solutions based on hyperconverged infrastructure, but you’re concerned with the limits inherent in those technologies.
For organizations that have amassed large sums of software complexity, taking a microservices approach is the first step toward DevOps and continuous improvement / development. Integrating system-level analysis with microservices makes it easier to change and add functionality to applications at any time without the increase of risk. Before you start big transformation projects or a cloud migration, make sure these changes won’t take down your entire organization.
Cloud promises the agility required by today’s digital businesses. As organizations adopt cloud based infrastructures and services, their IT resources become increasingly dynamic and hybrid in nature. Managing these require modern IT operations and tools. In his session at 20th Cloud Expo, Raj Sundaram, Senior Principal Product Manager at CA Technologies, will discuss how to modernize your IT operations in order to proactively manage your hybrid cloud and IT environments. He will be sharing bes...
A look across the tech landscape at the disruptive technologies that are increasing in prominence and speculate as to which will be most impactful for communications – namely, AI and Cloud Computing. In his session at 20th Cloud Expo, Curtis Peterson, VP of Operations at RingCentral, highlighted the current challenges of these transformative technologies and shared strategies for preparing your organization for these changes. This “view from the top” outlined the latest trends and developments i...
Automation is enabling enterprises to design, deploy, and manage more complex, hybrid cloud environments. Yet the people who manage these environments must be trained in and understanding these environments better than ever before. A new era of analytics and cognitive computing is adding intelligence, but also more complexity, to these cloud environments. How smart is your cloud? How smart should it be? In this power panel at 20th Cloud Expo, moderated by Conference Chair Roger Strukhoff, paneli...
Hardware virtualization and cloud computing allowed us to increase resource utilization and increase our flexibility to respond to business demand. Docker Containers are the next quantum leap - Are they?! Databases always represented an additional set of challenges unique to running workloads requiring a maximum of I/O, network, CPU resources combined with data locality.
SYS-CON Events announced today that MobiDev, a client-oriented software development company, will exhibit at SYS-CON's 21st International Cloud Expo®, which will take place October 31-November 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. MobiDev is a software company that develops and delivers turn-key mobile apps, websites, web services, and complex software systems for startups and enterprises. Since 2009 it has grown from a small group of passionate engineers and business...
SYS-CON Events announced today that GrapeUp, the leading provider of rapid product development at the speed of business, will exhibit at SYS-CON's 21st International Cloud Expo®, which will take place October 31-November 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. Grape Up is a software company, specialized in cloud native application development and professional services related to Cloud Foundry PaaS. With five expert teams that operate in various sectors of the market acr...
SYS-CON Events announced today that Ayehu will exhibit at SYS-CON's 21st International Cloud Expo®, which will take place on October 31 - November 2, 2017 at the Santa Clara Convention Center in Santa Clara California. Ayehu provides IT Process Automation & Orchestration solutions for IT and Security professionals to identify and resolve critical incidents and enable rapid containment, eradication, and recovery from cyber security breaches. Ayehu provides customers greater control over IT infras...
Artificial intelligence, machine learning, neural networks. We’re in the midst of a wave of excitement around AI such as hasn’t been seen for a few decades. But those previous periods of inflated expectations led to troughs of disappointment. Will this time be different? Most likely. Applications of AI such as predictive analytics are already decreasing costs and improving reliability of industrial machinery. Furthermore, the funding and research going into AI now comes from a wide range of com...
In this presentation, Striim CTO and founder Steve Wilkes will discuss practical strategies for counteracting fraud and cyberattacks by leveraging real-time streaming analytics. In his session at @ThingsExpo, Steve Wilkes, Founder and Chief Technology Officer at Striim, will provide a detailed look into leveraging streaming data management to correlate events in real time, and identify potential breaches across IoT and non-IoT systems throughout the enterprise. Strategies for processing massive ...
SYS-CON Events announced today that SourceForge has been named “Media Sponsor” of SYS-CON's 21st International Cloud Expo, which will take place on Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. SourceForge is the largest, most trusted destination for Open Source Software development, collaboration, discovery and download on the web serving over 32 million viewers, 150 million downloads and over 460,000 active development projects each and every month.