Digital Disruption: A Business & Technology Transformation
Digital Disruption: A Business & Technology Transformation Imperative James L. McQuivey, Ph.D., Vice President, Principal Analyst 26 February 2015 Developing Your Digital Intelligence - Sydney
How disruption is being disrupted
© 2013 Forrester Research, Inc. Reproduction Prohibited
2
Old objections to digital disruption
1
People will never do that
2
It will cost too much to do
1
We don’t know how to disrupt ourselves
© 2013 Forrester Research, Inc. Reproduction Prohibited
3
How digital disruption economics work Old disruption
Digital disruption
10 x the innovators 1/10th the cost 100X the power Source: October 27, 2011, “The Disruptor’s Handbook” Forrester report © 2013 Forrester Research, Inc. Reproduction Prohibited
4
Airbnb Melbourne & Sydney screen grab
© 2013 Forrester Research, Inc. Reproduction Prohibited
5
Digital services build digital relationships 90+ million 260+ million
42+ million
Apple took two years to sell 1 million iPods. © 2013 Forrester Research, Inc. Reproduction Prohibited
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Digital relationship opportunities exist in even very complicated industries Digital disruption
© 2013 Forrester Research, Inc. Reproduction Prohibited
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What infrastructure do you need to build this relationship?
› › ›
Create a cloud-based architecture that can serve a customer anywhere, anytime Prepare to serve customers in their mobile moments of need Build a big data solution that: • creates a single view of the customer • analyzes it as close to real time as possible • and adapts to meet the customer’s evolving needs
This will get more complicated very swiftly
How hard is this to do? To win, companies must have a disruptor’s:
Energy
Skills
Policies
We conducted a global survey of executives to see if they are ready.
© 2013 Forrester Research, Inc. Reproduction Prohibited
10
People see it coming but aren’t ready for it PERCENTAGE THAT AGREE WITH EACH STATEMENT (TOP 2 BOX) There is significant opportunity for digital tools and experiences to change the industry we serve
E
People in our company are excited about the changes that digital will bring to our company
S
People in our company have the skills needed to adapt to the changes that digital will bring to our company
P
Our company has policies and business practices that will enable us to adapt to the changes that digital will bring to our…
89%
65%
38%
32% 24%
49%
Base: 285 global executives
Source: March 5, 2013, “Assess Your Digital Disruption Readiness Now” Forrester report © 2013 Forrester Research, Inc. Reproduction Prohibited
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Senior managers have to lead disruption › › › ›
Only a third of CEOs believe they own digital strategy CIOs do not typically have the digital strategy, but they own the technology budget More CMOs are stepping up to own the customer relationship, but don’t have the technology skills 2015 will be a challenging year as the senior team figures out who should own digital
Meanwhile, the customer waits for better experiences
How Marketing and IT can do this together 1. Put the customer at the center of your strategy and ask what they want next 2. Let the CMO lead in identifying and responding to customer needs, even if it flexes the business model and the technology 3. Respect the CIO’s need to determine how to add the technical capabilities that will be required to please the customer It’s not about the CMO or CIO – it’s about the customer
© 2013 Forrester Research, Inc. Reproduction Prohibited
13
Thank you James L. McQuivey, Ph.D. forrester.com/disruption Twitter: @jmcquivey
How disruption is being disrupted
© 2013 Forrester Research, Inc. Reproduction Prohibited
2
Old objections to digital disruption
1
People will never do that
2
It will cost too much to do
1
We don’t know how to disrupt ourselves
© 2013 Forrester Research, Inc. Reproduction Prohibited
3
How digital disruption economics work Old disruption
Digital disruption
10 x the innovators 1/10th the cost 100X the power Source: October 27, 2011, “The Disruptor’s Handbook” Forrester report © 2013 Forrester Research, Inc. Reproduction Prohibited
4
Airbnb Melbourne & Sydney screen grab
© 2013 Forrester Research, Inc. Reproduction Prohibited
5
Digital services build digital relationships 90+ million 260+ million
42+ million
Apple took two years to sell 1 million iPods. © 2013 Forrester Research, Inc. Reproduction Prohibited
6
Digital relationship opportunities exist in even very complicated industries Digital disruption
© 2013 Forrester Research, Inc. Reproduction Prohibited
7
What infrastructure do you need to build this relationship?
› › ›
Create a cloud-based architecture that can serve a customer anywhere, anytime Prepare to serve customers in their mobile moments of need Build a big data solution that: • creates a single view of the customer • analyzes it as close to real time as possible • and adapts to meet the customer’s evolving needs
This will get more complicated very swiftly
How hard is this to do? To win, companies must have a disruptor’s:
Energy
Skills
Policies
We conducted a global survey of executives to see if they are ready.
© 2013 Forrester Research, Inc. Reproduction Prohibited
10
People see it coming but aren’t ready for it PERCENTAGE THAT AGREE WITH EACH STATEMENT (TOP 2 BOX) There is significant opportunity for digital tools and experiences to change the industry we serve
E
People in our company are excited about the changes that digital will bring to our company
S
People in our company have the skills needed to adapt to the changes that digital will bring to our company
P
Our company has policies and business practices that will enable us to adapt to the changes that digital will bring to our…
89%
65%
38%
32% 24%
49%
Base: 285 global executives
Source: March 5, 2013, “Assess Your Digital Disruption Readiness Now” Forrester report © 2013 Forrester Research, Inc. Reproduction Prohibited
11
Senior managers have to lead disruption › › › ›
Only a third of CEOs believe they own digital strategy CIOs do not typically have the digital strategy, but they own the technology budget More CMOs are stepping up to own the customer relationship, but don’t have the technology skills 2015 will be a challenging year as the senior team figures out who should own digital
Meanwhile, the customer waits for better experiences
How Marketing and IT can do this together 1. Put the customer at the center of your strategy and ask what they want next 2. Let the CMO lead in identifying and responding to customer needs, even if it flexes the business model and the technology 3. Respect the CIO’s need to determine how to add the technical capabilities that will be required to please the customer It’s not about the CMO or CIO – it’s about the customer
© 2013 Forrester Research, Inc. Reproduction Prohibited
13
Thank you James L. McQuivey, Ph.D. forrester.com/disruption Twitter: @jmcquivey
