Businesses change the way they do things in order to improve efficiency, increase revenues and stay competitive. However many processes or people or segments of the business are involved in that change, the goal is to take steps forward to create a sustainable business. Too often, forward movement is conflated with increasing complexity. But what businesses should be looking for to help them ride the wave of their own success is simplicity in transformation.
Transformation as a way of life
We talk about business ‘transformation’, but the term is misleading. It implies that there is a beginning and an end point, like transforming basic ingredients into a cake. But business transformation doesn’t have a definable end point. When the raw ingredients are themselves constantly shifting – as the market develops, regulatory environments evolve and customer preferences alter – so the business must respond and find the perfect points of symbiosis on an ongoing basis.
Finding value along the digital transformation journey
In technology, we talk about these as strategic inflection points –times when something comes along that radically changes the business landscape. If a strategic inflection point hits and you’re not prepared, you could be in trouble. Five years ago, who could have predicted the arrival of Uber for example. No matter how large and successful a business is pre-inflection point, those that are slow to respond will drop off their wave of success and may never get back on top again.
Organisations don’t always see inflection points coming. In a global market it’s hard to keep on top of the competition, no matter how good your near and far horizon-scanning is. A sassy start-up can come at any organisation sideways, so it is important therefore to be prepared for the unexpected. In today’s business landscape, where technology is central to working, that means organisations need systems that are easy to implement, quick to learn to work with, and don’t create confusion, delusion and resistance to change. Simplicity is everything when it comes to transformation.
Three crucial types of strategic inflection points
To be on top of inflection points when they arise a business needs to identify what type of strategic inflection point they are at or will be facing. Sometimes one will be more important than the others, sometimes more than one will be crucial. But without paying attention and understanding all three, a sassy start-up just might blindside you.
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One inflection point we’re seeing take increasing importance is the enablement of new business models, go-to-market models, etc. Servitisation is a good example of where producers of ‘things’ also providing services around those things, and ultimately may not actually sell products anymore. Rather, they will make their products available to the customer “as a service”, and it’ll include maintenance, service, etc. We have built our entire software around open APIs precisely because we understand how important it is for businesses to diversify into areas like servitisation where they need to connect “everything”. Software, assets, products, product lifecycles, everything, will need to be connected to enable breakthrough scenarios, and we understand that nothing in an enterprise can be an island in the future. We want to make that simple, easy and as fast as possible.
No business thrives without its people, and regardless of whether it is consumer facing or in a business-to-business environment, both its own people and those who interact with it need to feel at ease with the systems they’re using. So, our second inflection point is about people and experiences. We all expect user interfaces that lack complexity, to see the information on dashboards that are easy to understand, and to complete tasks because we intuitively understand how to get things done – without consulting an IT support person or a cheat sheet.
If we think getting the ‘people and experiences’ side of things right is vital now, just wait a few years, and watch the jobs market go through a bit more of the change that’s seeing a shortage of skilled workers, and a resulting willingness for people to go find employers that do things their way.
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Just as important as the first two inflection points is the third: automation and efficiency. Here, we are in the territory of businesses embodying those well-worn phrases, “sweating their assets”, and “doing more with less”. This boils down to using all the data a business has to its best advantage. This is another area where open APIs play a crucial part. Too often technology providers make filleting client data or combining data sets a hugely complex task (perhaps through a desire to monetise the process). It’s so much better when systems are geared to the future as much as to the now, so that it’s easy to draw in new data, and for processes to change or even disappear to ease efficiency with no loss of business continuity.
Open architecture is simplicity
The enterprise resource planning (ERP) system is usually the core of data management. It needs to be simple to share data with, and acquire data from other sources. It needs to be simple to develop, and it needs to be simple to access, allowing for more nuanced, complex modes as and when needed.
By adopting these principles, the best ERP tools can keep the sophistication that lies beneath intact and remain the servant of the business. Confusion, delusion, and resistance come about when the technology seems to be in the driving seat, but it is the principle of simplicity that will drive ongoing business transformation and speedy responses to inflection points.