How To Close That Elusive Digital Loop
How do we know or measure when an enterprise has truly gone digital? This is a question that every organization should be asking itself if it wants to succeed in the next five years. You read it correct: next five years. Not within the next century or even the next decade. Becoming a truly digital enterprise is no longer an option, if you want your enterprise to open up to new markets and thrive in the current ones.
I'm sure I could challenge one of my talented colleagues to write an algorithm by which enterprises could gauge their level of digitization. The algorithm would measure the total data in the organization - compare offline and online data, data derived from sensors, including ones on the shop-floor and products and from customer touch-points through a number of live connection nodes, web and social media presence, etc. These stats may look great during company presentations and can boost an organization's ego (due to the sheer amount of data they have been able to collect). Yet, if they are not leveraged to derive unique and actionable insights, they don't mean much.
I believe that the true measure of an enterprise becoming fully digital is in closing the loop. It's when the knowledge gained out of both real-time and historical data covering the enterprise, the customer, and the product, are harnessed to make insightful decisions. Successful ecommerce retailers, such as Amazon, offer us a compelling blueprint of this in practice. It knows what a customer wants based on both historical data as well as how that person is behaving online at that very moment. That way, they can offer real-time special deals that are tailored to that very customer. Positive and personalized online experiences such as these keeps the brand on customer recall. Customers are more likely to come back to the site.
Recognizing the importance of digitization, Jeff Immelt, CEO of GE famously said, "If you went to bed last night as an industrial company, you're going to wake up this morning as a software and analytics company," and is thoroughly transforming GE into a digital enterprise. Their CIO Jim Fowler aims to add US$ 1 billion to GE's productivity over the next three years by harnessing the power of data, and insights in creating digital twins that enable proactive problem solving.
Another company in the electrical equipment manufacturing space is already thinking about using sensor data captured from their equipment installed around the world to carry out near real-time root cause analysis and provide a proactive fix. More importantly, they are also going to use these inputs to influence the product design and hence, close this loop.
The number of examples are growing by the way. The bottom line is that a company that accomplishes the amalgamation of enterprise knowledge to influence elements such as product design, lifecycle, and other associated decisions in as near-real-time as possible is, in my view, closing that elusive digital loop.
So what are you waiting for? Let your digital journeys begin.