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Digital Business insights: Shock and awe
Just about every industry sector is now being impacted, threatened, destroyed or modified by the digital revolution.
A lot of people are in shock. Many refuse to accept that what is happening is real. They sincerely believe that things will return to the way they were, even if it takes a little while.
They won't.
Many others are shutting their eyes to what is happening. They don't see the connection between the bad times and technology at all. They blame other things.
They are wrong.
Others put lipstick on the pig. They acknowledge that something is happening. They don't understand it. But they take advice from the consultants and social media experts (who aren't) and carry on business as usual with digital paint on.
It won't work.
Some lucky industries (a few only) are out of the flood. But even they need to understand what is flooding past their door. The water will continue to rise.
But most industry sectors are in the heart of the digital flood of more connection, more collaboration and more integration.
The three primary currents of change don't sound like much, but the result of those three forces is disrupting the whole world.
Each succeeding current depends on the one before it. Connection is the primary current of change that shifted power from vendors to customers, that provided the platform for Google to dominate information finding and began the process of undermining what used to be.
It is responsible for the destruction of the advertising base of the media industry that has toppled the newspaper empires to the ground. They think they have it under control.
They don't.
They think they can get people to pay for content.
They won't.
The CEOs of the major media still don't get it. They put lipstick on a pig.
It is not enough to add digital to what was, the business model has to change. That has to start with a real appreciation of the shift of power.
New digital business models will only work if they are built from the customer up. Start with the customer and deliver.
Newspapers are a good example of what not to do.
Itunes is the perfect example of what to do in the new digital age.
The control of content was removed from the publisher completely and put into the hands of the customer to do what they chose.
And the process was made easy. Perfect.
The customer could select the tunes that they wanted and construct a new publication = my music. Apple realised clearly that the customer was in control and willing to pay to be in that position.
The publisher did not have a role any more in deciding the content of the album or the compilation. The customer is king.
The same thing applies to every other sector that is disrupted and threatened.
The key to understanding the exit strategy (the way out of the flood) is understanding the new customers and what they want.
Now, for Fairfax and News to continue to publish content under their mastheads and editorial control is old world not new world.
And to think that customers will continue to pay for this for years to come is wishful thinking.
Some will. Some always will. But not enough to replace the rivers of gold. And not enough to be sustainable.
Look what Apple did. They weren't into music. Then they were. Suddenly and successfully.
The principles apply to every sector. Who will come suddenly and successfully into your domain?
What does the customer want?
Ask them. Start there. And listen. If they tell you they want something, give it to them or somebody else will.
And like Apple they will come from left field or right field, not from where you expect or where you are looking.
Collaboration is the next current of change that will sweep us all along.
It is beginning to have an impact. It needed connection to happen ubiquitously. Now it has. And the tools of collaboration are being used and being newly built for us all to use.
And collaboration is even more threatening to those organisations that have only put lipstick on the pig. Because that is where the power of comparison and sharing and advising will undermine anything that isn't real.
Lipstick on the pig isn't real. It is just adding digital clothing to a business model that is still unchanged.
It won't work.
Now big organisations take time to fail, fall and drown, so they might even believe that they are on top of this, and I have spoken to many that do.
They aren't.
Revolutions overthrow the old but also build and create the new.
The process of digital change is accelerating in an uncomfortable way.
All opportunities at this time begin and end with the customer. Talk to them. Listen to them. They have all the information you need. And all the answers. But do it yourself. Don't let somebody else do it for you.
Ask your customers what has changed. Ask them what their problems are. Ask them what they would like from you. Give it to them.
The new tools of the digital revolution provide the means to create new solutions of many kinds.
Integration is the last current of change and that is even more threatening to the old order, because it joins things up.
It joins up those who want to be joined and it automates relationships delivering even more value than before. And when it is done in a way that satisfies the interests of all involved = shared value, it locks other things out.
It is still a little way off, but it is coming.
We haven't seen anything yet.
- John Sheridan, June 2013
* John Sheridan is CEO of Digital Business insights, an organisation based in Brisbane, Australia, which focuses on helping organisations and communities adapt to, and flourish in, the new digital world. He is the author of Connecting the Dots and getting more out of the digital revolution. Digital Business insights has been researching and analysing the digital revolution for more than 12 years and has surveyed more than 50,000 businesses, conducting in-depth case study analysis on more than 350 organisations and digital entrepreneurs.
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