Digital Technologies and Organizational Development
Most organizations are using digital technologies to improve operating efficiency as well as the customer experience. Although these are very important levers in organizational development, they are no longer enough. Achieving differentiation requires a strategy that uses digital competencies to truly transform the business, not just achieve incremental improvements.
There are several technology disruptions that organizations need to master as they grapple with how they gain and deploy knowledge and how they can turn those capabilities into a competitive advantage. While each of these forces is significant in it’s own right, taken together they can be truly transformational. They can simply re-define the very nature of an organization’s business and its ability to compete successfully.
Cloud Computing
In-house computer infrastructures are rapidly becoming “last century.” Cloud computing, be it private, public or hybrid, involves the provision of on-demand computing resources over the internet (ranging from applications to data centers) and is usually priced on a pay-for-use basis. Moving from physical servers to the cloud opens numerous possibilities such as easy back up, remote collaboration and file sharing, while making IT architectures scalable.
Social Networks
The internet affords the possibility of information and knowledge exchange at a pace and scale which could not be imagined even a decade ago. Computer mediated information exchange and discussion have become part of most people’s daily life. The implications of this on businesses is far reaching, affecting communications, operating processes and, ultimately, business performance.
McKinsey has carried out a series of surveys which explored how companies are using social technologies. One of the findings is that, while the uses of social networking technologies vary widely, they are mostly applied in externally focused processes such as gathering market intelligence and supporting marketing efforts. Internal use of these technologies appeared to be less common, yet significant ('How social technologies are extending the organization', J. Bughin, A.H. Byers & M. Chui, McKinsey Quarterly, November 2011.)
Big Data & Analytics
“Big data” has been around for a long time but the pace at which new data is being generated has reached staggering proportions and is accelerating. All organizations need knowledge to act on, quickly and effectively. But there is a huge difference between generating reams of information and the ability to turn that information into actionable insights.
Indeed, making sense of (often unstructured) data has become a key competency: finding patterns, unknown correlations and trends leads to better insights which can inform virtually all business processes, internal and external: helping make faster and better decisions.
Mobility
Digital technologies are transforming virtually of our business processes – how we market, create customer experiences, manage our workforce, produce products and services, and numerous others.
Mobile devices, applications and tools are making remote working the norm. We are no longer constrained by geography as we connect with customers or colleagues while being able to access company data and resources. Apart from enabling organizations to work better and faster, mobility can also help us recruit and retain talent by allowing workplace flexibility. We expect that what has been termed “talent wars” will becomes an even more critical business success factor in the future.
The Internet of Things
The Internet of Things (IoT) is quintessentially a technology-driven business revolution involving machine-to-machine communication with networks of sensors monitoring and tracking huge amounts of data. This data is then translated into useful information through cloud-based apps and is transmitted to machines which trigger the appropriate response in real time.
It is estimated that by 2020, the Internet of Things (IoT) will connect over 50 billion “things” and transform how we run businesses.
The IoT powers smart cars, smart homes and will, fairly soon, create the conditions for smart cities.
Future organizational development needs to involve mastery of these five forces as they re-define the competitive landscape as well as the competencies required for business success.
