Saturday, November 26, 2016

Macro Trends

This is the fourth part of my presentation “Making money from the cloud”. You can find the full slides at:

https://doc.co/LyrxvF/qcihGm

and the previous parts are at:

We live in exponential times

Consider the following

Major Trends

image

We previously took a look at the large trends that are shaping our world but now let’s take a look at the small trends that impact smaller businesses.

No matter how large or small you are technology is the key differentiation point. The Internet has allowed any single person to compete globally, The Cloud has allowed any single person access to the same level (power) of technology that once was only once available to the largest of businesses for a few dollars a month. Now it is not about what technology you have, it is about how effectively you use that technology. That is what determines your profitability above everything else.

Companies like Amazon are at the cutting edge of utilising technology to provide better service to their customers as the above video demonstrates. Thus, the focus of technology is about being able to deliver better results for customers.

This means that if you are an IT professional you need to be not simply ‘selling’ technology, you need to implementing technology that helps your customers grow their business. IT professionals need to help their customers understand and get the best out of technology. If left to their own devices people use less than 10% of the full functionality of any technology that is provided to them. This means there is an untapped 90% opportunity to work with the existing technology people have. It is much easier to get more from what you have rather than trying to sell you something new now isn’t it?

This means that the business of an IT professional is all about consulting now. Pure reselling of technology is a commodity game and only the largest can survive in that environment. Much of this consulting will also involve the re-engineering of existing businesses. A good example of this, once again, is the shift from traditional email to things such as social networks for communications. You can’t simply enable a social network like Yammer inside a business, you need to help the business make the transition to this new way of working. However, this is not possible unless the IT professional themselves is actually using the latest technology themselves. You can’t implement a technology without understanding, and typically using it, yourself.

Here’s the key. Those that adopt new technology effectively are simply more competitive, able to react faster and adapt to suit market conditions quicker. Yes, that adoption requires and investment but that investment pays major dividends in the future. Unfortunately, so many businesses and IT professionals don’t want to make that investment, instead preferring to ‘stay with the current way of doing things’. That of course means living in the past as the future continues to accelerate away. That means that when change is forced upon the organisation it is that much harder because the leap is that much greater.

There is no doubt that change is hard, both for a business and for an individual. However, if you can get comfortable with change then you really have a competitive edge. The trick to becoming comfortable with change is to develop a system to help you manage it and therefore look at change as providing you a competitive advantage in the market as the vast majority are resistant to change.

However, the really adjustment most need to make when it comes to change is simply doing less. The real secret of success in the future is doing less and doing that exceptionally well. The traditional model of business growth was always to continue to grow revenue more and more. The problem is that costs and complications can rise faster than revenue. Thus, a focus on revenue is folly, while a focus on profit is sanity. The smaller you are, the reality is that you can’t do ‘everything’. You need to focus on a niche and become the best in the world at that niche and partner with others to fill any gaps. If you need heart surgery you don’t go to a GP now do you? You go to a heart surgeon. Heart surgeons make pretty good money even though they specialise. The same applies elsewhere. If you are everything to everyone, then you are nothing to no one. Focus on becoming more effective and generating more profit not merely revenue.

Technology is the game changer that effectively levels the playing field for all businesses. However, it is something that is always changing and needs a process for adoption. Those that can deal with the changes we see have an opportunity to be more competitive than any one else. This opportunity requires an on going investment and typically results in a change of business model but the message is clear. You can’t remain in the past. You can’t remain standing still as the progress of technology continues to move forward allowing others to leap frog you and take away your advantage.

Technology is a tool. Success is a measure of how well that is applied to benefit customers. Therefore, any technology implementations need to be focused on the value they provide to their customers. This will also require challenges of innovation to solve problems using different tools but when you do, truly, the world is your oyster!