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With the evolution of technology, we have moved from closed systems of communication to open (social) platforms. We have moved from physical ground-based systems to disconnected radio-based (mobile) systems. We have moved from explicit content prose to the deduced and inferred meaning (analytics) of messaging, and from self-sourced location-specific data centers to utilitarian (cloud) enabled forms of communication and interaction. The uptake of social, mobile, analytics and cloud -- SMAC -- technologies has profoundly and indelibly changed the way we work and play and, as with most things in life as we know it, there are implications.
Rise of the digital business era
"Not getting any bars on your phone? That doesn't mean you can't communicate with faraway friends. Just send them a smoke signal … "
-- excerpt from "How to Send Smoke Signals"
While many of us, this author included, are intrigued by smoke signals (see Addendum) and still derive visceral pleasure from the warmth, sights, sounds and smells emanating from the flames and smoke that billow from a good campfire (not to mention the marshmallows and hot dogs), the confluence of social, mobile, analytics and cloud technologies has in fact ushered in a new era of business capability. To distinguish this phase of commercial evolution from that which came before, let's refer to it as the Digital Business Era. To best understand the implications of the DBE (sorry, I just could not resist), it is important to look at the major technologies that define it.
Social media/networking technologies have totally transformed the way in which people communicate and interact with each other and with businesses. Sharing your content is no longer about writing letters, sending emails or placing advertising in print or online media outlets. It is now about posting your content to your wall or your website or your blog site, and also tweeting, texting and instant messaging. Physical meeting and interaction is rapidly being replaced by virtual communication: Circles of friends, family or business colleagues, which in the past were kept separate, have been replaced with virtual and overlapping communities of personal and business friends and family.
Mobile technologies have totally transformed where and when we communicate and interact with each other, essentially eliminating space and time boundaries almost entirely. One no longer needs to be home to receive the letter or phone call or wait until the store opens at 8:30 a.m. to buy the whatever. Importantly, mobile technologies have also enabled us to attend the staff meeting from in front of the campfire and not need to share the marshmallows.
Analytics technologies have completely changed how we determine whom to connect with on what topics, which products to buy or where to find the best deal. The broad net cast by marketing and advertising based upon (presumed) demographic segments of readers or viewers is rapidly being honed and finely tuned. The act of learning how to understand each of us uniquely and to communicate with us as individuals is often referred to as segment of one marketing and sales.
Cloud technologies, even in early stages of mass-market adoption, have already made a tremendous impact upon how we acquire technology and, even more significantly, allow us to be untethered from our resources, whether they be work-related programs and data or play-related music and/or video. We can access our digital stuff (DS) from anywhere at any time, and in a relatively carefree manner.
Our world is filled with both consumer and commercial examples of how people and companies are embracing these technologies in ways that dramatically demonstrate the power of the digital business model. Companies like Frito Lay and Ben & Jerry's engage their customers through both traditional and social media channels to vote for the next flavor of potato chips or ice cream. Big box stores routinely make use of customer analytics to determine which products to offer their customers, and when they detect --via geo-fencing technology -- that customers are within close proximity to their stores, they send text messages to the customer's mobile phones with discount coupons for products related to those already purchased. In this way, stores hope to attract customers and sales that likely would not have occurred through traditional means.
The CIO implications
For CIOs there are, as always, clear challenges and opportunities. As we enter the 2015 planning and budgeting cycle, it's a great time to reflect upon the implications of living and working in the Digital Business Era. Here are a few things to think about.
It's all about the customer. In the Digital Business Era, largely driven by social, mobile, analytics and cloud technologies, customers have access to more information about products and services and, importantly, can learn about other customers' experiences with products and services throughout all phases of identifying and evaluating product alternatives. This can help inform purchase decisions and the use or consumption of products and services. This proliferation of information has and will continue to shift the balance of power from the seller to the buyer. If your enterprise does not already have a customer experience (beyond customer relationship management) program in place, it is time to start thinking about one. If you already have one in place, consider how it can be enhanced and leveraged for competitive differentiation. Ultimately, this is all about supporting your business partners in driving increased revenue through customer satisfaction, retention, cross-sell and up-sell. Your business partners will thank you.
BYOD is being replaced by BYOF. If you believe that BYOD (bring your own device) is about network architecture, cyber-security, provisioning, device management and reducing costs, think again. It's really about Bring Your Own Friends (BYOF). As the next generation of employees enters the workforce, bringing their own smartphones is a given. Enterprises have become increasingly mature around how to provision and manage these resources. What is not so obvious and a much bigger challenge to management is how to cope with the use of social media and social networking that is embedded within these devices. The integration of social and business affairs within one's singular community of friends and family requires clear policies, guidelines, management tools and methodologies to both leverage the value of social networking and simultaneously protect enterprise assets in this newly comingled world. Your coworkers will thank you.
The nature of leadership and management is changing. The historical command-and-control style of management is giving way to community-and-collaboration. Organizations are becoming more flat and stakeholders are linked more horizontally than vertically. Increasingly, links of the supply-chain are being replaced with partnerships or outsourced service providers. In this environment, management by decree will become less effective. Partner relationship management based upon clearly defined business outcomes, and in an environment of mutual respect and trust, will become increasingly more important. Consider how you work with and manage third-party relationships today and begin to examine how sustainable and scalable these relationships will be in the Digital Business Era. Your shareholders will thank you.
Addendum: A brief history of the smoke signal
Perhaps one of the earliest forms of text messaging, smoke signals were used by ancient Chinese soldiers stationed along the Great Wall to expediently notify each other of threats up to 500 miles away.
Around 150 BC, the Greek historian Polybius advanced smoke signal technology considerably with the invention of the "Polybius Square," an early form of message encryption that required the sender and receiver to utilize a pre-determined cipher to originate and decode the message. The Germans and Japanese used similar cryptographic techniques during WWI.
Indigenous North American people made extensive use of smoke signal communication, often using the distance up the hill from which the signal originated as the means to identify message content; for example, smoke billowing from the top of the hill generally indicated danger.
The Boy Scouts of America use three puffs of smoke to signal trouble or the need for assistance. Perhaps the most popular application of smoke signals still in use today is made by the College of Cardinals in Rome to communicate the status of an election process underway to choose the new Pope -- black smoke meaning no decision, white smoke indicating that a new Pope has been elected.
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