When I first heard the term “digital business", I really wasn’t convinced in the concept as the next big thing.
The problem I had with the term is that I grew up in the 80s - so the idea of “digital” conjured up images of burning my Nirvana cassette tapes to CD.
But then I thought about it and realised that for all the technology many businesses have adopted, they aren’t yet truly “digital”.
Many parts of the business are still doing things the old way; paper forms, manual processes and servicing clients in ways that work for the business, not their customers.
The emergence of mobility, cloud, big data and social are really forcing the need to fully evolve into a digitally-enabled business. Organisations need to adapt and cleverly use technology to refine every operation and interaction - and even create entirely new business models.
Evolution of the entertainment industry
A key example of an industry that has been forced to go digital is entertainment, which is being completely changed by technology and consumer demand.
Consumer “grazing” habits have changed – many have stopped walking into stores to browse content and meekly hand over money. Frustration with delayed global releases of movies and TV shows has caused many to look online.
New challengers from the digital world have stepped in to take advantage and give consumers the choice and control they demand – and user experience is king.
• Movies and TV shows are readily available online through services like HBO and Netflix and even our home-grown Lightbox, fundamentally changing viewing habits and disrupting traditional suppliers.
• Music is now downloaded and streamed more than it is purchased in stores, with many users happy to “rent” rather than “own” music through streaming services like Spotify.
Also by being online and socially connected, Spotify helps break-through artists like Lorde to get into the limelight.
• Print media is also under threat, with more people looking for online versions of newspapers and magazines. We still want the content – just in different ways.
For example, electronic books have more than compensated for the decrease in sales of paperback books – delivering an overall 14 percent revenue increase for the publishing industry.
Digital evolution has completely shaken up the entertainment industry. We’ve seen bookshops, video rental stores and record stores close, newspapers and magazines struggle to adapt to digital formats, and monopolies smashed by new competitors.
Customers will demand a digital makeover of every industry
This transformation to digital will take place across almost all industries and government agencies over the coming months and years.
For each industry, there will be a tipping point - the time when businesses that haven’t started to evolve will start to die out.
New Zealand has a reputation for innovation and that reputation is going to be put to the test. The world is getting smaller – offering many new opportunities, but also making global competitors more of a threat than ever before.
Technology change, consumer demand and competitive pressure will force change: either evolution to a digital business or extinction. The time to envision your digital future is now – at the absolute latest.