Digital advancements are challenging traditional industry practices, redefining concepts of scale, scope, and speed. For traditional companies to keep up and not be overtaken by digital native organisations, it is of critical importance to embrace technology as a means to develop and enhance competencies.
Having a ‘smart’ product or app is no longer enough. To compete in the new digital age, companies should be harnessing and using real-time data to further their products, build better relationships with their customers, and enhance their business strategy.
At a recently held book launch for ‘Fusion Strategy: How Real-Time Data and AI Will Power the Industrial Future’, we were privileged to welcome one of the authors, Venkat Venkatraman, who shared some key insights from the book.
Here are 6 lessons we took away:
1. The cost of ignoring digital disruption
Successful companies die because they invested in what they were good at today, but underinvested in what they needed to be good at tomorrow. They failed because they misread the signals of disruptions.
2. Build your competitive edge
Venkat believes every company should be building data graphs as a way to observe products in-use, collecting real-time information, and becoming trusted custodians of customer data, in order to gain a competitive advantage.
3. Automotive; a canonical industry
Tesla puts a fusion strategy into practice. They don't see themselves as a car manufacturer, but as a data processor. They build 'computers on wheels' that collect data from which the company extracts value. With their own supercomputer, they process this data to improve the performance of their driving computers and develop new features.
4. Physical + digital
With the shift from analogue to digital, Venkat believes that over the next few years, as the cost of computing comes down, more people will realise that we can digitise health and interactions beyond what we do on social media, and this is what they call industrial AI, or the digitisation of the physical world. Physical and digital components must come together in a new business model; that’s the fusion part.
5. Fusion strategy
Every industry will go from chip to cloud to customer, like the automotive sector. The challenge for all of these companies is, how do you design systems and processes to support this integrated technology from the ground up, rather than just adding it on to your existing operations? Fusion strategy is ultimately about the mindset, skill set and tool set. Companies are urged to develop a fusion strategy that integrates a digital core into their business plan, accelerates corporate clock speed for the AI era (the speed with which companies can innovate and adapt to changing market and customer needs), and adopts diverse AI co-pilots.
6. Co-creating value
Every company should be thinking about IT (information technology), and OT (operations technology) integration. OT is how products are designed, delivered and maintained, IT is a process by which human beings support the design, delivery and deployment of the data. As you develop the AI language that is specific to your industry and company, IT/OT integration becomes important. It’s about multiplying human intelligence with machine power. Companies need to think of data in the way it will be used in the future, which is much more integrated and extended into the ecosystem.
You are what you measure
Venkat concluded by stating; you are only as good as what you measure. Companies are only as good as what the market expects them to deliver. Metrics are shifting, and without experimentation, incumbents have failed so far to counter digital threats in the asset-light sectors. Will it be different for the industrial, asset-heavy sectors? You’ll have to read ‘Fusion Strategy’ to find out…
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