Today, nearly everything is thinking. There’s an ever-expanding amount of data available to businesses, provided directly from your mobile device, your TV, your toaster, even your light bulbs. And, the proliferation of data shows no signs of slowing down. Consider this: more data will be created in 2017 than in the previous 5,000 years combined.
All of this data, all of this thinking, has brought us to an innovation tipping point: Innovation is moving from promise to reality more quickly than ever before, creating traction for technologies like Machine Learning, the Internet of Things, Artificial Intelligence and Blockchain, to help companies transform and reinvent themselves. With all this opportunity, however, many companies find it hard to know how to harness it, where to invest, or even the right questions with which to begin.
Digital transformation leaders vs. laggards
Given this complexity, we’re seeing a clear divide in how – and more noticeably, whether – these advancements have been adopted and applied effectively. In fact, our recent SAP Digital Transformation Executive study in partnership with Oxford Economics found that business know that they need to digitally transform to capitalize on this innovation tipping point, but many are entrenched in a way of thinking that prevents and discourages that kind of bold change needed to survive: that technology change is an incremental shift within an existing model. There were a few key distinctions between the leaders and laggards that all boil down to one thing: Leaders are thinking outward– beyond their processes – to their customers, to their market and even to other markets; and they are looking forward, at how today’s newest technologies can have a major impact on their business tomorrow.
To put this into perspective, the study showed that those lagging in digital transformation put a focus on increasing speed to market and developing new products and services as their top two revenue drivers, indicating a “product first” mindset that places a huge focus on competition and the increasing pace of change. Conversely, leading companies surveyed were 58% more likely to cite customer empowerment as a key global trend and saw significant value from transforming their customer satisfaction and engagement.
Digital leaders are also looking forward – finding ways to apply new technologies for improvements in productivity, as well as creating agile teams that can discover, respond to and adapt quickly to advance with new technologies. In fact, 62% of leading organizations have already created these teams, a figure estimated to rise to 82% over the next two years.
Innovation-first at Bosch
The Bosch Group, a leading global supplier of technology and services with divisions encompassing mobility solutions, industrial technology, consumer goods and energy and building technology, is a great example of a company that is driving digital transformation and new business models with this outward-looking, forward-thinking mindset. Bosch is putting innovation first by investing in the Internet of Things, Artificial Intelligence, Machine Learning, Augmented Reality, Virtual Reality and more. The company has looked outside of its own market by partnering with SAP last year to collaborate on cloud technologies and software to speed up manufacturing and logistics processes.
Bosch is also turning to the startup ecosystem to engage and identify collaboration opportunities through partnerships with organizations like startup incubator 1871. The partnership with 1871 led Bosch to take innovation a step further by launching their own IoT innovation space, the Chicago Connectory, where a community of startups, university faculty, corporations and organizations come together to drive IoT innovation. As a result, Bosch has further expanded their outside-in innovation approach.
Lean into your future
These qualities point to a greater truth of what it means to lead the pack in today’s business landscape: True digital leaders are looking beyond themselves and their traditional markets to better inform their own business goals. They are leaning into their futures to encourage bold change. They’re giving responsibility for those changes to teams that look at projects not as incremental improvements in isolated pockets of the business, but as opportunities to unify and improve the entire enterprise. They’re investing in new technologies so they can deliver the improvements customers are clamoring for. And by doing so, they’re not just keeping up with the pace of change, they’re leading the pack and ensuring a successful future for many years to come.