This is a red flag warning for those who think digital technology is something the IT department does! It is not; today digital technology is the purview of Boards and Senior Executives.
Do you sometimes get the feeling that you are being bombarded by news of the next great wave of technology, or the next “big thing”? I am very selective regarding content streaming into my Inbox and keep regular briefings to a few selected blogs and news sites. This week my Inbox is being hit by crypto currency and blockchain, next week it will be something else, as short while back it was AI; but I guess that is now old hat.
With all this noise, it is instructive – in fact necessary - to take a helicopter view of what is really happening – because, while individual technologies and developments are massively important, and are likely to be directly relevant to you – one does not grasp the phenomenal scale and rate of change until you look at the overall digital landscape that is opening in front of us. Specifically, Non Executive Directors and Boards need this kind of perspective to increase their awareness and align their company’s strategy with future digital technology opportunities.
Let’s Start with a Quick Snapshot
By 2020 we will see massive growth:
From 3bn ↑ 4.2 bn users (52% penetration)
From 16bn ↑ 26bn devices
From 5 bn ↑ 12bn machine to machine
Connections 1.9x ↑ faster
Delivering 2.9x more data at ↑ <300k Pb pm
Mobile data will grow faster ↑ 7x
Wearable from 96m ↑ 600m
Over the next four years, we will see massive growth in all aspects of Internet use. The number of users will increase to over 4.2 billion – up from 3bn in 2015/2016. 26 billion devices will be connected to the Internet – up from 16billion, of these 12 billion will be machines (or autonomous devices) talking to machines - compared with 5 billion just 18 months ago.
For those connected to the internet, speeds will be markedly faster – on average, almost 2 times faster at over 50 megabit per second.
The increased number of users, extended network coverage, and faster speeds will generate almost three times the amount of data than today – reaching 300,000 petabytes per month. To understand what that means – 300,000 petabytes is equivalent to the functional memory of 240 million human beings, or 1.2 million libraries, each the size of the US library of congress - the largest library in the world with 162 million items in its collection.
Data generated by mobiles will grow the fastest to over seven times today’s volume at 50,000 Petabytes.
We will become a population using wearables –– from smart watches to smart glasses to fitness straps to implanted devices. Wearables will see a six fold increase to 600 million users.
Takeaway 1: The increase in the domination of the Internet in our lives will be at a scale far larger than today – and an inescapable part of every business process, sliver of information, reorganisation, and your customer relationships.
Is there a Digital Chasm opening before you?
TODAY, change is happening at an alarming and unprecedented pace, and this pace will only accelerate. For the unaware, there is a Digital Chasm Opening Before You.
What is happening?
Computing power, new engineering concepts, the reach of the Internet, network capacity, and the proliferation of devices are all increasing exponentially, and innovative engineers and companies are changing the rules of business on a daily basis. Disruption is at every turn.
The digital world is vast and subject matter ranges from the familiar – the role if the smart phone you own – to the esoteric – such as quantum computing and neural networks.
Takeaway 2: Today, it is imperative that Directors and Boards have a level of digital literacy align their company’s strategy to future digital opportunities.
To help this process, I want to start by visiting some familiar and some unfamiliar examples (in a separate post I will cover other subjects that provide strategic context).
I will start with some observations that have become commonplace.
Let’s consider these frequently quoted cases:
a. An on line bookseller has become the worlds third largest retailer
b. The world’s biggest hotel chain owns no property
c. The worlds largest taxi company owns no vehicles
d. The worlds largest content provider creates no content
And of course, these businesses are Amazon, Uber, Airbnb, and Facebook.
While these are familiar example of businesses in the digital age, there are thousands more companies that are creating new business models and changing the business landscape.
Just going back to the descriptions I used – I would invite you challenge the notion that these companies are indeed a retailer, a hotel chain, a taxi company and a content provider. They are not – they are (global) platforms that all do one thing … and do it very well, very fast, and very conveniently for the customer.
While these descriptions (“a retailer, a taxi company, etc.”) are convenient classifications that play easily into copywriters’ script, the core attribute of each of these companies is that they connect people:
a. Amazon CONNECTS people with retailers.
b. Airbnb CONNECTS people with accommodations providers.
c. Uber CONNECTS people with taxi owners / companies
d. Facebook CONNECTS people with other people who have content to share
You may feel that this is an obvious comment – but reflect on it.
These massively successful companies, and others like them across countless industry sectors, and across the world, are based on the foundation of CONNECTING people. In the current world that we live in “Connections” is what matters, connections that create value.
It’s not about how cheap you can be, or how fast you can get there, it’s about how you connect with people, and connect people with other people, and connect people with information to enable them to be informed and make autonomous decisions, that matter to them.
Not about how cheap you can be, or how fast.....It's about how you connect with people, connect people with other people, and people with information....that creates value for them.
When you’re in business you have a choice. You can create a commodity, or you can create a connection.
As we will see, a business that provides connections to a universe of loyal followers – and a business that resides at the centre of a users digital ecosystem – can connect that unique user with more products and services – increasing value further – and in the process, disrupt existing industries.
Takeaway 3: Boards, Directors determining future strategy, need to carry this lesson into how they build our future digital strategies.
Is there more to come?
With all the hype about the digital revolution and the highly publicized case studies which we have just mentioned and when we hear about:
a. Autonomous Vehicles,
b. Drones, BOTS,
c. Holographic Lens, and virtual reality, being backed up by
d. Artificial Intelligence Big Data and Deep Learning
One could be forgiven for thinking that we are already so far into the new digital world that there is not too much more to worry about.
Such a view would be an extremely misguided and the reality is that the digital revolution has barely started, and so has the accompanying upheaval.
We are witnessing the very visible tip of a massive iceberg.
Over the next three to five years much, much more will change – almost to the point of having to suspend rational thought.
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