Mouli Ganguly, Member, Board of Advisors, talks on Industry 4.0, Digital Transformation and more:
1. How has the market reacted to digital transformation so far? What are some factors that seem to aid it/ factors that act as a barrier?
Introduction of computers in the 80s and internet in the 90s were digital transformations (DT). These transformations speed up an existing process in their own way.
Currently, with Augmented Reality (AR), Virtual Reality (VR), Mixed Reality (MR), Artificial Intelligence (AI), Internet of Things (IoT), Big Data etc, we are heading to the third wave in digital change. With this change, content reach has become faster and more specific to the user’s individual & specific context.
There is a question of what is the hype and what is the reality? The hype is often an expectation that Everything will turn digital from day one. But the reality is it takes a long, long time.
Digital disruption is when the whole user experience changes. When you look at the current technologies like AR-VR, you are in an immersive environment. The second thing that changes in a business is convenience. It gets faster and better. Take for instance YouTube, people are not wholly dependent on it for video services. We have now got other video streaming options. From being costly and time-consuming to produce a video, now they’ve become so simple. Within a span of five years, existing technologies have changed so much.
In the residential space, AR-VR is already there. If you look at smartphones or movies, almost every movie has a VR effect in it. Whereas in the enterprise phase, it is happening far more slowly due to change management issues. There are a whole lot of processes, policies, rules that play out. These multi-factor influences act as barriers, at times.
Take a look at this scenario:
On a personal level, if you see a 3-D glass that you fancy, you just go ahead and buy it and try it and see. But in the enterprise phase, we cannot change what we do on a day-to-day basis, immediately. It is a gradual process to adopt changes and involves formal change management. Enterprises don’t have individual decisions like personal buyer choices. A new technology adoption must act in a certain business standard. In an enterprise space, one person cannot just act on it or start using something. There are other people involved. This is a huge barrier in adopting or initiating digital transformation.
2. If you were to chart a blueprint for an enterprise’s digital transformation, what actions would it typically involve?
Adopting new technologies to businesses happen if there is a clear benefit. Unlike personal choices, a business cannot adopt a technology or a process without a defined benefit. There should be a strategy or a growth plan that cites the benefits.
Benefits can be divided into three: Either the customer or staff experience the product or service delivers is much superior leading to increased loyalty and willingness to adopt from them. Since organisations measure customer satisfaction, this is an inclusive environment.
Next one on the list is Product or process improvement. Take for instance claims processing in an Insurance company. It is quite difficult organising in person, especially if the person has availed trauma insurance. In a digital world, you can have a number of different tools from virtual assistance to people working in collaborative environments to remote diagnostics with telemedicine, all of these improves the overall process. I want the latest in…
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Enterprises must include the market & customer in its product development. It is easier to create a digital product. One can quickly create a product and launch it and test it as a POC (proof of concept), before scaling up or canning it all together. Therefore, the whole product cycle in the market is faster than before. Through failure, you learn, Fail fast and fail without incurring a high cost or brand damage and you will innovate with successful offerings.
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Finally comes the cost reduction factor. Basically, several things drive digital adoption. You grow the experience, generate customers, grow staff loyalty and therefore get more market opportunities. You get market opportunities to get new products by reducing the cycle time to market, your process has changed, you change the format quickly. And as your cost reduces, you become more productive. This sort of drives some of the opportunity.
Now, what is the big risk that you face while doing so?
Benefits, use cases & training/change management needs are not clear. For instance, when we say I’ll improve the claims processing experience in an insurance company, one needs to clearly articulate what is the use case. What is the customer roadmap of the journey? How the customer uses the new digitised transformational services that you provide. Then one has to map it all the way. At each point, you have to state what is different. How or where will I be delivering this service and how will the business be using it. It is not a technology or process issue. Business must very clearly define the benefits they will get.
Now, how do you do it?
The last one, which must be designed in terms of the blueprint, is integration. Every organisation has a whole lot of legacies. Because nobody is working in a vacuum. The new systems have to interwork with the legacy in most cases. This becomes a difficult, costly & cumbersome process.