IT Operations Plays It BIG in the Fourth Industrial Revolution

A massive digital transformation is underway, which forces businesses across a broad spectrum of industries to rethink and reinvent their business models, operations and the way they interact with customers. Over time, this “Fourth Industrial Revolution,” as the World Economic Forum has called it, will have a dramatic impact on how all of us work and live.

The catalyst for this revolution is a dramatic cultural shift that’s taking place due to the rapid adoption of technology and substantial changes in both the customer and competitive landscapes. In fact, the motto for businesses everywhere has become “disrupt or be disrupted,” as companies increasingly recognize their survival and short- and long-term success (or failure) hinges on their ability (or inability) to create Digital Value for their customers (i.e., digital experiences that unlock and deliver monetary and non-monetary value for customers in a more engaging and meaningful way).

The reason, as Shelly Palmer, author of Digital Wisdom: Thought Leadership for a Connected World, pointed out to Forbes magazine is that: “It took 30 years to connect the first two billion people to the internet. It will take less than seven to connect the next two billion. While no one can predict how disruptive this exponential increase in connectivity will be, we can expect to live in a profoundly different world.”

Thus, it makes sense that in early 2015, John Chambers, currently the executive chairman of Cisco, told a group of business leaders at a Wall Street Journal conference that “40 percent of the companies in this room won’t exist in a meaningful way in 10 years unless they change dramatically.”

Digitizing Business: A Challenging but Crucial Task

For companies that succeed, making a digital transformation can be both challenging and rewarding. According to Pierre Nanterme, CEO of Accenture, “Digital companies can reach new customers immediately and at virtually zero marginal cost. They can compete in new sectors by collaborating with peers and competitors. They can massively improve quality and productivity by converging technologies and sources of data.”

For example, instead of solely relying on a traditional business model to succeed, Starbucks created more value for its customers by digitizing some of its most important customer experiences. It did so by developing a mobile order and pay (MOP) application that allows customers to pre-order and pay for a beverage online and then pick up their order at the store of their choice, instead of having to physically wait in line to order and pay.

Thanks to this app, the company now has a direct channel to promote and sell its products to customers, as well as a means to encourage more impulse purchases (Would you like a muffin with your coffee?).

In addition, the company created its own mobile payment application and linked that app to its customer loyalty program, as well as tying MOP to the inventory management systems of individual stores, thereby reducing its operating costs.

Want other examples of how IT operations are improving the digital experience for customers across a host of different industries, enabling companies to engage customers in new, more cost-effective and meaningful ways?

  • Today, the world’s largest taxi company doesn’t own any taxis (Uber)
  • The largest accommodation provider doesn’t own any real estate (Airbnb)
  • The world’s largest movie house doesn’t own any cinemas (Netflix)
  • The largest phone companies don’t own any telecom infrastructure (Skype, WeChat)

And the business landscape is filled with other similar examples.

While all of the examples cited here are of different businesses with vastly different business models, operating in verticals that are also drastically different from one another, the unifying thread is that all of them depend on maintaining IT operations in some form or other, to improve the digital experience of their customers.

Regardless of what business you are in, these days providing a rich, meaningful digital experience is key to engaging with your customers. And to do that requires that you maintain seamless IT operations.

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