Imagine that your toughest future competitor just opened their shop today. By definition, they are starting on Day 1 with the most modern thinking, processes, and perhaps most importantly, modern technology. Over the next 5 years, this new company’s acceleration will be constant. In 5 years they will blow by you and you won’t even know what happened.
The fuel for this acceleration will be technology.
Have you noticed that your old tricks aren’t working as well anymore?
Over the last few years, the cost advantages of moving labor overseas has eroded - this is true for manufacturing as well as technology and thought work. Many companies are moving manufacturing jobs back to the US. A colleague talked about closing a US plant, and losing 200 jobs along with it, and sending the work to China. It took 5 years for the Chinese plant to get up to the same production and quality standards, and it took 2000 people. That move clearly did not create a cost advantage. Similar stories abound about not getting cost advantages sending development overseas. It might cost 1/3 as much, but it takes 4 times longer.
Technology on its own is not an advantage. Smart technology, that suits and fits the business which employees and customers understand how to use and get value from, is the only technology that matters.
If you have a technology system everyone hates, or is slow, or people create workarounds for, then you don’t have a technology advantage. You just have a dated technology that your team or culture is not adapting to, or maybe it’s the wrong approach altogether..
Think about retail clothing. Trunk Club’s business is a beautiful combination of personalized service and technology. And how do they power the customer experience? By having the the technology inform the client representative just in time.
As cost pressure increases for your business, most companies will start with cost cutting, perhaps layoffs, but at a certain point, you won’t be able to squeeze anything more out of your operations without creating technology systems to leverage what people know.
There are things that only people can do. And there are things that a machine is just fine for, or sometimes even better suited to do.
Does your company spend lots of money on processes that could or should be automated? What could all those intelligent, well-trained people be doing? Engaging with customers?
While supermarkets are still struggling with self-checkout, Starbucks figured out that people don’t like waiting in line all that much. You can now order from their mobile experience and just pick it up in-store. What can you learn from this? Right now, technology is at a point where it can handle straightforward transactions easily. The more complex it gets, the more mutuality you need from your customer. As a result, I can happily reorder my “usual” from Starbucks in a couple of taps while I usually avoid the self-checkout. Find your balance.
Don’t be “that company” - here’s how you can find your digital advantage:
You know how your business works. Make a list of all the best-defined processes you have in your company. Now order them from least-to-most complex. Take a look at what is at the top of the “least complex” list and start thinking about how technology could possibly do those things.
If you are lucky, you might be able to find a new idea that could only be done with technology.
BMW recently announced that all of their cars will be electric within 10 years. BMW doesn’t want to be Blockbuster which famously acted too late to move their dominance of the individualized movie experience online. Tesla is the Netflix of the car industry. In 15 years will we all wonder why GM or Toyota didn’t see the writing on the wall quickly enough?
Change will be painful, but it’s better than closing your doors. So why not start today? Your new competitor just did.