Some key enablers make digital transformation possible. Prominent among these are Social, Mobile, Analytics and Cloud Computing (SMAC).
When Mark Zuckerberg created Facebook at his Harvard Dormitory room in 2004, he could barely have imagined how the platform would evolve from connecting a few friends to becoming a tool and a platform for millions of businesses (small, medium and large) globally.
With almost three billion users worldwide, the opportunities presented to businesses by social media is enormous, and with the advent of a new area called “big data”, we may even just be scratching the surface.
Facebook and Twitter, two of the most prominent of these social networks provide solutions for businesses ranging from advertising, to customer support and reputation management. They have also opened up their platforms to make it possible for companies to build custom applications and thereby aid the integration of third-party solutions.
A major benefit of the opening up of these platforms is that rather than waiting for customers to come, businesses could and are reaching out to these customers through targeted advertising. Beyond customer acquisition, these businesses can also provide support to their customers by leveraging these social platforms. The platforms also enable them to monitor their brand and products in a real time fashion such that it becomes easier for them to manage any crisis before it escalates and becomes uncontrollable.
In addition, the businesses are also taking advantage of the platforms to extend their influence beyond their current customers by building a new audience of followers with the creation of many rich and engaging content.
Identity management is another area where the social platforms have excelled. Organisations can now enrich their awareness of the customers’ preferences by leveraging the social platforms. In addition, these organisations are leveraging identity management capabilities not only for their customers but also for their own recruitment efforts. For example, applications like Facebook and LinkedIn are able to provide them an in-depth look into candidates before they are recruited.
Financial Institutions (though conservative at first) are also now taking advantage of the social platforms to transform the way they do business. For example, some have made it possible to open a bank account on Facebook while others have created chatbots for conducting transactions. Some others have gone further to take advantage of the Facebook relationship graph to reach an extended audience beyond their customers.
It hasn’t all been positive for the social platforms though. For example, the Cambridge Analytica scandal that Facebook was enmeshed in brought the operations of the social media under major scrutiny lately. However, what the scandal has also done is to further highlight the powers of these platforms rather than wane their influence.
Though smartphones and tablets are the most obvious of the mobile devices, companies that are embarking on a digital transformation journey must view mobile from a broader perspective. With this broader perspective, those companies could begin to see mobile devices both as a customer touchpoint and also generally as a business enabler.
Beyond smartphones and tablets, there are other enablers such as wearable devices and Internet of things (IoT) devices. The former is on the verge of revolutionizing healthcare with the delivery of personalized treatments, while the latter is revolutionising the maintenance of industrial machines.
Mobile devices are also assisting to extend the mobility of an organization’s workforce. This has made it possible for an employee to access remotely the resources they need in order to work from anywhere and anytime. An understanding of this has made several organizations to adopt the concept of “Bring Your Own Device” (BYOD) to work.
Transportation is another emerging segment for the massive use of mobile solutions with a company such as Uber leading the pack.
With the prevalence of mobile though, security of data becomes a major challenge. Therefore, organisations that are interested in embarking on a digital transformation journey must do all that is possible to ensure that they are protected. Another challenge is the need to ensure interoperability across multiple mobile operating systems in order to guarantee investment protection.
The general availability of digital devices has brought with it a vast amount of data never seen before in history. According to IBM, 2.5 Billion Gigabytes of data was generated every day in 2012.
So what is the role of Analytics?
Well, Data, no matter how voluminous it is will not make much sense if it cannot be analysed for useful insights. What makes this analysis possible is the area known as “Data Analytics”.
Data Analytics can be descriptive, predictive or prescriptive.
Descriptive Analytics helps an organization to understand what is happening in their environment. For example, a financial institution that is using descriptive analytics on its data can know what channels are the most frequently used by a customer group and how this usage varies across time and geography.
Predictive analytics leverages historical data for the prediction of the likelihood of an event occurring in order for an organization to plan effectively. For example, it could help the organization to predict the likelihood of an infrastructure shutdown such as a server shutdown during a peak period of business activity. Predictive analytics can also be applied to other areas such as fraud detection, where each transaction is analysed for its likelihood of being fraudulent.
Prescriptive analytics goes further to recommend the next possible steps of action based on the order of their likely effectiveness. An example of this is in industrial repairs where the machine recommends the best possible course of intervention based on available data on the interventions that have worked best in the past for similar machines with the same problem.
The unstructured nature of some data makes Analytics a cogent need. It has been estimated that almost 75% of data is unstructured, ranging from text to audio and to video. Analytics therefore enables organisations to make meaning of these data sets.
The challenge for many organizations is about how to find the right talents to champion analytics efforts or to identify good analytics solutions. Fortunately, most applications today come with an analytics feature embedded in them. The applications also can be connected and integrated with some other available analytics solutions.
Data could be hosted physically on premise or remotely. When hosted remotely, then it is a cloud solution and it is said to be hosted “virtually”. That is essentially what cloud is about. Cloud computing therefore makes data hosted elsewhere accessible through the internet just as one would on a local computer.
The managing director of a major bank asked me some time ago why information technology people use very complicated words like “cloud” as if we are all out to confuse people.
Cloud computing was long considered to be only for startups and techies who could not afford to invest in physical infrastructure. Today however, Governments, Corporations, and Small and Medium Scale Enterprises (SMEs) are on board.
Cloud has always been with us actually. If you have a general email application like Gmail, Yahoo, etc., you are already doing some cloud computing as it is unlikely that those e-mails are hosted physically on your computer.
Cloud becomes important because in this era of rapid business change, the usually high amount of investment and complexity of managing information technology (IT) infrastructure can be a clog in the wheel of business. Cloud computing assists to eliminate this burden. It gives organizations access to an unlimited amount of infrastructural resources on demand. This ensures that those organizations can focus on their areas of core competence while being rest assured that their infrastructural needs are well taken care of.
Cloud computing, it is not just a cost-savings measure because in addition to cost savings, it has also made it possible for companies to roll out services in record time.
A poster child of cloud computing is a Customer Relationship Management (CRM) application called Salesforce. Before Salesforce (and other of such solutions), it used to take weeks and months for large enterprises to set up details of their customers. With Salesforce, it is now possible for organisations to set up those details required by their marketing teams in just a day. This has created a new industry of “Software-as-a-Service (SaaS)” providers.
Other leading providers of cloud computing services are Amazon, Google and Microsoft. Their offerings have gone beyond cost-savings to making accessible on their platforms other solutions such as database management, messaging, load balancing, and many others. Many large enterprises have adopted the “hybrid cloud”, a blend of cloud-based and onsite physical infrastructure.
One major challenge with cloud adoption however is Security. For multinationals, this concern is heightened by cybersecurity laws which requires organisations to store local data within their geographical borders, as in the case of China.
Another major issues with cloud is cost over the long term.
In spite of the challenges though, it could be said that cloud computing has come to stay.
In summary, those four applications (social, mobile, analytics and cloud) are some of the major enablers of digital transformation. It wouldn’t be a surprise if an organization already has a footprint of activities across these four enablers. However, for digital transformation to be truly achieved, it is required that these enablers be applied to the different business processes of an organisation, based on their overall business objective.