Navigating Digital Convergence in Your BusinessBy Samuel Greengard | Posted 2014-08-27 Email Print
The rapid advance of digital technology is changing the stakes for business and IT leaders, who need a strategy to conquer challenges and exploit opportunities.
Digital technology has driven enormous change over the last few years. Organizations across a wide swath of industries have been forced to fundamentally rethink and remap the way they conduct business—and approach IT.
Lurking beneath all the opportunities is the recognition that the convergence of these digital tools and technologies also presents a more complex and risky environment. Tying together all the pieces of the puzzle—mobility, cloud computing, social media, big data analytics and more—is daunting, and extracting value from the constant stream of media, content and data originating from diverse sources is taxing.
To be sure, many business and IT leaders find themselves scrambling to keep up with the challenges of navigating the digital IT space. "There are a growing number of digital tools, channels and technologies that are essential to business," observes Michael Sutcliff, group chief executive for Accenture Digital. He believes that the technology opens two separate doors, and executives must be aware of both. "While there is a need to address and solve problems and challenges that have existed for years, it's also necessary to confront the new and emerging challenges that these technologies create."
At the center of the equation? The digital enterprise is permanently changing connection points and touch points. Success in this environment requires a different understanding of business and IT; a rethinking of the relationships between the enterprise and its customers and partners; new products and services; different data and content delivery models, such as apps; and entirely new ways to communicate and collaborate. All of this, in turn, requires new skills, expertise and knowledge, along with different roles and a revamped management structure.
As Lanny Cohen, global chief technology officer for consulting firm Capgemini puts it: "There is a great deal of pressure on organizations to tie together many different elements in a way that enhances both the business and the consumer experience."
At the heart of digital convergence is the realization that combining various digital technologies, tools and devices creates a multiplier effect. As these systems interact more synergistically, entirely new features, capabilities and connection points exist.
Many executives already recognize this opportunity. A 2014 Accenture study found that 35 percent of C-level executives globally expect the convergence of social, mobile, analytics, cloud and connected products—grouped together as digital technologies—to increase sales in existing markets. In addition, three quarters view digital technologies as a strategic investment, rather than something to be evaluated on a case-by-case basis.
But putting a plan into action can be intimidating. First off, it's necessary to introduce and integrate IT resources across departments in order to break down organizational silos. It's also essential to rethink and remap business processes and workflows, procurement processes, governance models and more.
In addition, as Cohen points out: "There are key issues to address in order to achieve the necessary level of agility and flexibility." Within this emerging model, IT-centric decision-making and waterfall development models are increasingly obsolete. "Business and IT leaders must take a big-picture view," he adds.
Developing a Deep, Broad Digital Strategy
One organization that's embracing digital transformation is Skullcandy, a leading manufacturer of headphones, earphones, earbuds and other audio products. The Park City, Utah, company, which was founded in 2003 and went public in 2011, has focused on developing a deep and broad digital strategy, according to IT director Mark Hopkins.
"We sell online through Amazon and eBay, as well as through a number of digital channels and in our own stores," he says. "We have a broad customer base, and we deal with major consumer retailers like Best Buy, Target and Wal-Mart, as well as small mom-and-pop gaming, snowboard, skating and skiing shops. We have to make sure we are interacting with everyone efficiently."
Over the last few years, the company has used digital convergence to connect technologies and systems far more efficiently on both the back and front ends of the business. One of the key areas Skullcandy has focused on is sharing information from its cloud-hosted SAP Business by Design enterprise resource planning (ERP) system to more than two dozen Web stores and shipping partners such as UPS and DHL.
The company turned to Jitterbit to create a standard interface for viewing orders and various other forms across disparate partner systems and varying file and data formats. In the process, the software simplifies the tracking of transactions and communications, tapping into mobility, social business and cloud-based data sharing.
Skullcandy also relies on Microsoft SharePoint to facilitate communication across the enterprise. The company has focused heavily on incorporating social business and social media into the fabric of its business.