Business in today’s Conceptual Age revolves primarily around the development of innovative new concepts that bring seemingly diverse and unrelated pieces together, to form an interesting new whole. Driven by technology innovation and application of high concept thought, new business models have emerged in the Conceptual Age – helping companies transcend conventional methods of scaling to achieve sustainable growth.
Technology serves as a catalyst for the Conceptual Age – enabling new business strategies that fundamentally transform how businesses operate, and serve customers. In this post, we consider a few key emerging business strategies in the Conceptual Age, driven primarily by technology innovation.
Powered by advances in Internet of Things (IoT) and Artificial Intelligence (AI) technologies, intelligent automation is ushering in a new era of productivity and performance improvements for organizations – enabling its people to not just do things differently, but also do different things. By gathering vast amounts of data, and synthesizing it to automate business processes or workflows, intelligent automation systems are taking over both – routine, manual tasks, as well as complex ones, allowing human workers to focus on higher-value work. A 2017 McKinsey article notes that intelligent automation will be a core part of companies’ next-generation operating models, offering the promise of radically enhanced efficiency, increased worker performance, reduction of operational risks, with improved response times and customer journey experiences.
Rather than replace human workers with machines, forward-thinking companies are deploying intelligent automation technologies to foster a more productive relationship between humans and machines, making each of them more powerful than they are individually. Beyond taking over repetitive and routine tasks, these technologies are capable of assisting their human co-workers in smarter decision-making through analysis of vast amounts of data, and identification of trends or patterns that are otherwise not detectable.
Intelligent automation is pervading almost every sector of the economy today – with increasing application across financial services, healthcare, retail, logistics, automotive and aerospace industries, among many others.
Digital Ecosystem Platform Models
Businesses today are in the midst of a transformative shift towards platform-based models and strategies. A platform business model is one that creates value by facilitating the exchange of goods, services or content between independent groups of participants – usually consumers and producers/service providers. This exchange is enabled by technology. Platforms create scalable communities and enable interactions within these communities, while creating value for the entire community.
Pioneering companies like Facebook, Alibaba, Uber and Airbnb have leveraged the transformational power of platform models to drive scale and success. Platform owners do not actually own the assets that are offered on their platforms – rather, they only provide a means to connect producers and consumers of such assets using technology. Facebook, for instance, generates no content, while Airbnb owns no real estate. In the Conceptual Age, platforms will be the dominant business models, enabling businesses to create new markets and realize new growth opportunities.
By harnessing the power of connected technology such as IoT, businesses are moving beyond traditional industry silos and coalescing into highly ‘connected ecosystems’ – partnering more intensely and effectively with players from a diverse set of industries, while re-inventing their value chains afresh. Digital ecosystems, consisting of networks of businesses that span several different industry verticals, are driving the next wave of disruptive change for businesses in the Conceptual Age. By plugging into these ecosystems, businesses will have the potential to tap into new sources of data and revenue while improving existing service lines, business processes as well as customer experiences. The shared use of digital platforms facilitates collaboration among the various entities that are part of the ecosystem – be it people, processes, things, or data.
Data is at the core of digital business operations, and failure by companies to protect the integrity, control and handling of data could potentially result in reputational risks, and loss of customers. As businesses today become increasingly digital, ethics and security will be critical considerations for maintaining strong relationships with customers, and ecosystem stakeholders. An Accenture Report predicts that – going forward, trust and digital ethics will continue to play an increasingly critical role in business operations and become the minimum standard for participating in industry ecosystems.
To survive and thrive in the Conceptual Age, businesses must not only leverage technology to streamline their existing functions, but also to enable new business strategies, a few of which have been discussed above. Going forward, every business will need to incorporate a platform strategy, or risk being disrupted.
Stay tuned to our next post where we discuss how platform business models are fundamentally different from, and more resilient than traditional pipe business models.
1. People First: The Primacy of People in a Digital Age, Accenture Technology Vision 2016
2. Intelligent process automation: The engine at the core of the next-generation operating model, McKinsey, March 2017