Business Model Innovation

 Business Model Innovation is a hot topic today. In its bi-annual CEO study, IBM concluded in 2008 after interviewing 1130 CEOs in 40 countries across 32 industries, that two thirds of the companies are implementing extensive innovations in their companies, especially around their business models.

In the last decade new technology has enabled close to zero cost of reproduction, storage and delivery of everything that can be made digital. It has enabled business model transparency, ways to interact and communicate with external actors, and tools to collaborate and globally distribute innovation and value creation. The increased transparency together with a cultural change, forces companies to not only focus on increasingly demanding customers, but on all affected stakeholders. Companies are bombarded by change, and business models need to be adjusted for companies to keep up. Important to keep in mind is that business models change but economic laws do not. For tips on how to approach business model innovation read 10 Tips on Business Model Innovation.

Three tools for Business Model Innovation

The Business Model Innovation Matrix

The matrix, that has recieved some great attention, consists of 40 principles developed to solve complex inventive problems on the vertical axis, and 8 business model components on the horizontal axis generating 320 areas for Business Model Innovation.

A systematic approach to identify Business Model Innovation opportunities is to identify the different parameters that can be innovated upon, and the different principles for innovation.

The Business Model Innovation Matrix is based on 40 principles to solve complex problems that were originally developed for technical inventions and published 1969 in the book Algorithm of Inventing, by Genrich Altshuller. The principles were a result of an analysis of 200000 inventions and has become a cornerstone in TRIZ. Now 40 years later the principles has been further developed based on the results of analyzing close to three million inventive solutions in science, arts, politics, engineering and business.

The Business Model Innovation Matrix consists of the 40 principles on the vertical axis and the business model components and the horizontal axis. As there is no dominant and widely accepted definition of the term business model I use the components below to explain the framework. If you prefer another business model template, with other components, you can of course apply the principles of innovation on that model.

Often discussions on Business Model Innovation are limited to the improvement of value propositions. By creating the matrix with the 8 parameters presented below and the 40 Principles of Innovation I have 320 unique areas to generate ideas for Business Model Innovation.

Business Model Components

• Value recipient - Who are we providing value for?
• Value Proposition - What values are we providing?
• Delivery - How are the values delivered?
• Assets, Capabilities & Activities - What internal and external assets, capabilities and activities are needed?
• External Relationships - What forms of external relationships are needed?
• Control Mechanisms - How is the value creation and extraction controlled?
• Benefit and Revenue Model - How are benefits and revenues generated?
• Costs and Harms - What are the costs and harms?

Some combinations of principles and business model components are easier than others and I will exemplify with Principle 1 applied on each of the components presented above.

Using 1 of 40 principles for Business Model Innovation

When using Principle 1 - Segmentation the objective is to divide the business model parameter into independent parts, make the system or objects easy to disassemble or increase the degree of fragmentation or segmentation.

Value recipient

• Can we segment the value recipients into micro-niches?
• Can we go from mass market to mass customization?
• Can we provide value for sub-groups of the value recipient?

Example: Spreadshirt

Design and sell your own t-shirts with a free online shop

Value Proposition

• Can we unbundle value propositions into different parts or modules?
• Can we move from one service level to several different service levels?

Example: RyanAir

You get nothing but the seat in the basic value proposition

Delivery

• Can we deliver the value proposition in parts?
• Can the value recipient be part of the assembly?

Example: IKEA

Providing disassembled furniture for the user to assemble

Assets, Capabilities & Activities

• Can we unbundle important assets, capabilities or activities into several smaller ones?
• Can we more effectively use the unbundled resources?
• Can we improve deployment of individual skills?
• Can we use flexible systems to respond to individual conditions?

Example: P&G

Providing technology and IP to its competitor Clorox instead of launching competing product

External Relationships

• Can we go from one large partnership to several smaller ones?
• Can we go from one organization to a franchise concept?

Example: McDonalds

Probably the world's most famous franchise

Control Mechanisms

• Can we control the value proposition by controlling parts of the value creation or value extraction?
• Can we control the value proposition by controlling the underlying assets, capabilities or activities?

Example: Myriad Genetics

Controlling underlying databases and patents

Benefit and Revenue Model

• Can we divide the object for transaction into smaller parts?
• Can we divide the payments into smaller payments?

Example: American Express

One of the first to create a worldwide credit card network

Costs and Harms

• Can we use temporary workers for the value proposition?
• Can we use short term contracts with external actors?
• Can we distribute costs and harms by diversification?

Example: Goldcorp

The famous GoldCorp Challenge

The Value Proposition Hierarchy Explorer

The basic idea underlying the tool is to identify assets and capabilities that are really valuable and identify how value could be created by combining own and external assets and capabilities into new value propositions.

I have developed a tool I call the Value Proposition Explorer to clarify the space around an originally stated value proposition by broadening or narrowing the scope. The basic idea underlying the tool is to identify assets and capabilities that are really valuable and identify how value could be created by combining own and external assets and capabilities into new value propositions. The outcome of repeating this several times is a hierarchical list of value propositions, from which the company is able to select and assess business opportunities.

The tool should not be mixed with the idea of positioning a company in the right place of a value chain (One-sided business models) but a tool to break free from the value chain thinking. A value proposition can be directed not only to the company's existing customers, but other stakeholders, traditionally not considered to be customers (see Two-sided, Horizontal and Multi-layer business models). A value proposition does not have to be based on developed products and services (even though that is almost always the definition) but what one actor has to offer another actor:

An example

P&G is constantly looking for ways to leverage its assets through its external business development and connect & develop initiatives. Based on the original value proposition of Pampers diapers you now find lots of co-branded or co-commercialized products such as bibsters, wipes, swim pants, underwear and concepts going upwards in the Value Proposition Hierarchy Explorer. At the same time P&G is offering to license technologies and IPR relating to developed odor controlling bio-component film to be used in human contact products, cleaning devices, medical supplies such as bandages and hospital bedding, and even to use the technology in airline cabine space to control odors and smoke.

Finding own, others' or joint value propositions

When searching for valuable assets and capabilities, it is important to not only focus on own business model and industry, but also the potential need of others:

• How can we strengthen own value propositions?

• How can we strengthen others' value propositions?

• How can we create joint value propositions with others?

Business Model Innovation using Ideality

Ideality is a simple yet powerful tool to generate new ideas for business models. It is a tool that instead of starting from current business model and current value propositions, starts from the theoretical ideal situation.

Ideality is a simple yet powerful tool to generate new ideas for business models. It is a tool that instead of starting from current business model and current value propositions, starts from the theoretical ideal situation. The theoretical ideal situation can be defined as all potential benefits at no costs or other harms. Using Ideality helps you look at the constraints of a business model and creates out of the box ideas. The most common approach is to apply Ideality on value propositions and analyze the ideal value proposition from the value recipients’ perspective. However, Ideality can be used as a tool to improve all business model components.

• Value recipient - Who would be the ideal customer and other value recipients?
• Value Proposition - What would be the ideal value proposition?
• Delivery - How would the values ideally be delivered?
• Assets, Capabilities & Activities - What internal and external assets, capabilities and activities would be ideal?
• External Relationships - What external relationships would be ideal?
• Control Mechanisms - What would be the ideal way to protect value and profits?
• Benefit and Revenue Model - What would be the ideal benefits, and revenue model?
• Costs and Risks - What are all costs and risks that theoretically could be removed?

Ideal for who?

What is ideal for one stakeholder is often not ideal for another. Customers want perfect products and services for free, not to be in a lock-in and get the value delivered instantly while the suppliers want to provide better-than-competition products and services, and make a profit from it. By mapping out what would be ideal for the different stakeholders, contradictions and constraints can be identified. To solve contradictions is a classical way to improve business models. Below an example looking at the value proposition from the customer perspective.

Working backwards

With the ideal situation identified, the next step is to work backwards to something that is achievable. This is carried out by a systematically decreasing benefits and/or increasing costs and harms.

http://bit.ly/3O8V5ub

Future-Proofing Your Strategy: How To Use McKinsey’s Three Horizons Model

 A valuable framework to move your company from inertia to innovation is McKinsey’s Three Horizons Model. Here I look at who can use the model, what it is and how companies can put it into practice to drive continuous growth today and in the future.

When companies are born, they are filled with forward momentum, innovation and growth. As the years wear on, that innovative spirit is often replaced with inertia. Organisations get bogged down with the day to day and aren’t as proactive about looking toward the future. That’s precisely the set of affairs McKinsey’s Three Horizons of Growth framework is setup to address. Since this model can help most organizations, let’s take a look at what it involves and some ways companies can put it into practice.

Who can use McKinsey’s Three Horizons Model?

Any company that needs a simple framework to inspire growth and innovation can benefit from the Three Horizons model. Featured in the book Alchemy of Growth, this framework won’t just impact your organisation’s financial goals, it can invigorate your team and ignite their passion once again. Based on three years of research into how high-performing companies sustain growth, the Three Horizons Model won’t jeopardise today’s business as it maximises future opportunities. Every organisation needs consistent growth over its life, and that’s precisely what the Three Horizons model provides.

What are the Three Horizons of the Model?

Horizon 1: Maintain Core Business

Horizon 1 is about your core business as it stands today and priorities to improve performance on the current drivers of profits and cash flow. It’s the products and services that are most closely tied to your success right now and your plans to squeeze out every bit of profitability by improving efficiencies and margins.  

Horizon 2: Develop Emerging Business

These are business opportunities that will require investment, but could result in substantial profits in the future. These activities represent an extension of your proven business model, so even though they require investment of time and money, the revenue potential is solid. These are things such as expanding your business to a new geographical area or adding new product lines.

Horizon 3: Create New Business

This horizon is all about expanding into entirely untapped elements that don’t exist in your business today. Examples of initiatives in this horizon would be pilot or research projects that would require upfront investment to vet the potential business for your organisation. Microsoft was operating in Horizon 3 when it launched the gaming console Xbox which was entirely removed from Microsoft’s core offerings at the time when they were in the business and productivity arenas.

How Can Your Organization Use McKinsey’s Three Horizons Model?

The first thing every organization needs to understand is that these horizons are worked on simultaneously—you don’t complete Horizon 1 and move on to 2 and 3. Part of the objective of this model is continuous growth, and it requires that your team works on initiatives in every horizon. This model gives voice to the strategic needs of the future while maximizing your current reality.

When you’re first launching this framework in your organisation, you need to be sure you have a firm understanding of your biggest assets and drivers of success for today. Then, consider what would happen if you lost all of those.

Next, you’ll jump to Horizon 3, because this is the place where you are dealing with entirely new business—nothing you relied on in Horizon 1—and would be where you jumped to if everything you relied on in Horizon 1 were lost. Horizons 2 and 3 require more C-suite involvement, because these horizons demand more financial investment and approvals to allocate resources on “what-ifs” rather than guaranteed income producing activity. As your organisation has conversations about the possible future, your team will have to navigate the tension and uncertainties inherent in going beyond your comfort zone.

Horizon 2 is the bridge that gets you from Horizon 1 to 3. Once you know where you’re heading, you can create an action plan to get from Horizon 1 to 3 and the activities of Horizon 2 will help you close the gap between the two.  

The 70/20/10 Rule

When you put the Three Horizons into practice in your organisation, the 70/20/10 Rule is a good way to plan your activities. Seventy percent of your activity needs to be focused on Horizon 1 since your survival today is crucial for getting to tomorrow. Then, allocate 20 percent of your activities to Horizon 2 which should be enough to account for the failures and missteps your team will experience to bridge to Horizon 3. That leaves 10% of your activities for the research and experimentation of Horizon 3.

By segmenting your innovation thinking and priorities into three horizons, McKinsey’s Three Horizons Model can help set the foundation for your organization’s continuous growth today and for the future.

https://bit.ly/3nbaPO8

What is business innovation?

To thrive in a competitive landscape, businesses must be willing to adapt and change - but what is business innovation exactly? And how straightforward is it?

BY FRANCESCA CASSIDY

What is business innovation?

Business innovation is when an organisation introduces new processes, services, or products to affect positive change in their business. This can include improving existing methods or practices, or starting from scratch. Ultimately the goal is to reinvigorate a business, creating new value and boosting growth and/or productivity.

Why does business innovation matter?

Business innovation matters for one simple reason: value. In order for your business to thrive, it is crucial to be continually innovating and improving. Successful business innovation means finding new revenue opportunities, optimising existing channels and, ultimately, generating higher profits. It should also give companies an advantage over their competitors.

Three models of business innovation

There is more than one way to innovate and organisations of different ages and sizes will have different reasons for embarking on a process of business innovation. For some it may be a case of re-assessing the ways in which the business generates revenue, for others it may be necessary to move into a different industry altogether - or even to create a brand new one! Before embarking on any innovation cycle, it is important that organisations understand the various different business innovation models available to them.

REVENUE MODEL INNOVATION 

If increasing profits is the main driver for business innovation, many organisations may choose to change their revenue model as a first port-of-call. This can involve re-assessing the products or services offered or taking another look at the company’s pricing strategy. Innovation does not have to be radical, sometimes changing even one element can yield significant results.

BUSINESS MODEL INNOVATION 

This model of business innovation requires organisations to identify which of their processes, products or services could be improved to boost the company’s profitability. Innovation in this case could refer to forming new partnerships, outsourcing specific tasks or implementing new technologies.

INDUSTRY MODEL INNOVATION 

Arguably the most radical model of business innovation, ambitious organisations can choose to change industry completely for the purposes of innovation - or even create a whole new industry for themselves. Indeed, companies can win a new lease of life by following examples such as Virgin’s move from aeroplanes to broadband.

Three industries embracing business innovation 

LAW

Cambridge-based law firm, Taylor Vinters, has partnered with artificial intelligence-focused startups Pekama and ThoughtRiver. At the same time, it has sold off other elements of its business, such as regional real estate, that were deemed a distraction from core aims.

The firm’s managing partner, Ed Turner, explains: “Assuming it’s an accepted proposition that fundamental change is going to be necessary, it’s important to understand the purpose of your organisation and why there’s a need for it in the future. Having a clear understanding of that is absolutely essential, particularly in the mid-market.”

For Taylor Vinters, the focus is now on entrepreneurship and innovation, with tech partnerships forming an important part of the firm’s offering, opening doors to a whole new client base.

PACKAGING

When it comes to business innovation, the packaging sector offers some of the most exciting examples around. Public opinion and global expectations of sustainability, health, and convenience dictate packaging design and currently the tide is turning against plastic. This has encouraged retailers and manufacturers to explore alternative materials and led to the rapid development of fibre-based materials and creative inventions, such as biodegradable seaweed pouches for ketchup.

New technology has also allowed companies - particularly those in the food and beverage sector - to innovate and adapt to meet new demands. Online grocery retailer, Ocado has embraced “co-botics”, where robots work alongside human employees. Robots deliver pallets of goods to humans who pick out the specific customer orders. It is likely that this is where the future of automated packaging lies, delivering a superior performance than could be achieved by either robots or humans working alone.

By keeping an ear to the ground, and an open mind when it comes to technology, the packaging sector has put business innovation at the centre of all operations.

HEALTHCARE

It is not only the private sector which must be constantly looking to innovate. The NHS is one of the largest employers in the world and with increasing demand placed on it by the UK’s aging population, finding ways to cut costs and improve services is crucial.

To do this, the NHS is harnessing new technologies and making much better use of data. Along with implementing artificially intelligent chatbots to help patients self-serve, the NHS Blood and Transplant department has begun working with digital consultancy T-Impact to improve and automate its process for matching donated hearts with recipients. This has resulted in the world’s first allocation of a heart using a cloud-based system.

This streamlined process has removed 40 steps that were performed manually by staff, creating a 68 per cent reduction in NHS administration time. “These are the sort of improvements that well-run digital transformation programmes can deliver,” says Keith Stagner, chief executive of T-Impact.

What technologies are driving business innovation?

ARTIFICIAL INTELLIGENCE

The power and potential of artificial intelligence (AI) cannot be overstated.Almost every industry and realm of life is set to be transformed by it, with the estimation that by 2020, 95 per cent of all customer interactions will be carried out by some form of AI. When it comes to business innovation, it is one of the most exciting technologies available, with firms such as PwC estimating that it could add $15.7 trillion to the global economy by 2030.

“Everything invented in the past 150 years will be reinvented using AI within the next 15 years,” predicts San Francisco-based Randy Dean, chief business officer at Launchpad.AI.

It is already having a transformative effect in a number of industries. In sales AI can help strengthen pitches by detecting and reacting to consumer emotions. Japanese investment bank, Daiwa Securities, found that customer purchase rate increased by 2.7 times after they implemented AI technology.

In the healthcare and pharmaceutical sectors, AI tools have been built which can sort and accumulate medical knowledge and data on a scale humans could only dream of. At one end of the spectrum sit dosage error deduction and virtual nursing assistants, at the other: genome sequencing. AI has brought the time and cost of sequencing someone’s genome, which is the unique arrangement of their DNA, down to 24 hours and just $1,000 respectively.

Pepper, the humanoid robot at the SoftBank Robot World 2017 Congress in Tokyo

ULTRAFAST INTERNET

It has long been acknowledged that time is money, and the most important tool for business innovation is one which can help organisations move faster.

Enter, ultrafast internet.

In the UK, rural provider Gigaclear offers a fixed line service bringing speeds of 900 megabits per second (for reference, “superfast internet” starts at 24 Mbps), but in South Korea speeds of 2500 Mbps have already been achieved. And mobile networks will be transformed as well, with the advent of 5G making speeds of 1000 Mbsp possible on a smartphone.

To put this in the context of business innovation: it will now be possible to restore a medium-sized corporate server in a little over an hour, compared with 28 days before.

Businesses will be able to share data between remote facilities in near-instant fashion. For example, ProLabs is a connectivity hardware manufacturer with production facilities in Gloucestershire and California. Anthony Clarkson, chief technology officer of ProLabs, says: “Having ultrafast fibre connectivity has enabled our group to harmonise production by instantly sharing data, such as test reports and production templates, which are key to the production facility. This allows significant operational savings. None of this would have been possible on a traditional copper internet connection.”

Who is responsible for business innovation?

In a 2017 PwC study of global chief executives, nearly 25 per cent had innovation at the top of their priority list for the year ahead, but is it really CEOs who can drive business innovation?

It is vital that business leaders foster an environment where innovation is a natural part of company culture. “It is vital that our organisations are able to attract people with the right tech skills, but also to develop those skills internally,” says PwC chairman and senior partner Kevin Ellis. “As well as recruiting people with digital skills, organisations need to focus on training their people to be adaptive, creative and critical thinkers.”

However, although top-down leadership of business innovation is crucial, there are key roles and departments whose collaboration and expert knowledge are necessary to affect the changes.

THE IT DEPARTMENT

In 2015, Raconteur launched a study of workplace innovation, in collaboration with Google for Work. This study revealed that over a quarter of respondents saw IT as the main driver of innovation - a view which has barely changed since. With technology at the core of business, those with the ability to master it have the power to spark change. Not to mention that the IT department has close working relationships with every part of a business, which allows them to drive innovation and improve collaboration across the organisation.

CHIEF DATA OFFICER

Still a fairly new role, it is the generally-held view that most large companies will have appointed a chief data officer (CDO) by 2019.

Smart use of data is key to business innovation, and CDOs are responsible for highlighting where opportunities and threats lie. Richard Merrygold, director of group data protection at Homeserve says: “CDOs need to sell the benefits. The CDO role is one of looking for efficiencies, simplifying needs, demonstrating cost-benefits, and encouraging businesses to be open and transparent.”

Through their CDOs companies are becoming empowered, and the data they work with is fuelling their business innovation, where information is corralled, analytics are powerful and data use is nimble.

CHIEF TRANSFORMATION OFFICER 

According to LinkedIn, there are 121 chief transformation officers (CTOs) in the UK, along with hundreds more business transformation officers, digital transformation officers and the like.

But it’s not a job title that’s been around for very long, emerging over the past decade or so as organisations realise the need to be more responsive to change.

The term chief transformation officer has a wide meaning: some CTOs see themselves as visionaries, while others are essentially project managers for an overhaul of an organisation’s processes, often through technological change.

Either way, a successful CTO could be exactly the person to take up responsibility for driving business innovation. “We’re all living through intense change, the pace of which is only accelerating,” says Jason Dormieux, global chief transformation officer at media agency Wavemaker. “Regardless of title, all companies need people whose obsession is around what products and services they can build in order to help their customers take advantage of the opportunities that this disruption brings.”

Expert advice: how to begin business innovation

The experience of business innovation will vary greatly from company to company, but there are some common pitfalls which can, and should, be avoided. Three experts offer their suggestions on what to watch out for.

DON’T FIXATE ON DISTANT GOALS

“A solid strategy must avoid all-encompassing initiatives without careful understanding and planning. Instead, taking on board ‘quick wins’ will help to bring a clear impact on operations and obvious benefits. This can be done by running multiple small projects in parallel to ensure the best ideas are progressed rapidly and the bad ones fail early.”

Matt Jones, lead analytics strategist at data science consultancy Tessella 

DON’T NEGLECT DESIGN 

“An increasing number of fast-growth startups are founded by designers. The design course on Stanford University’s MBA is one of the most popular and it’s increasingly understood as a powerful strategic tool. That said, many businesses still don’t realise this and not only neglect to create a leadership role around design, but also fail to invest in growing design capabilities more broadly in the business. Done properly this will force a company to entirely rethink how it brings new products and services to market as well as how it runs and organises itself.”

James Haycock, founder and managing director of innovation and change consultancy Adaptive Lab

BE WARY OF RIVALRY BETWEEN CHANGE LEADERS 

“Herd instinct driven by the kind of digital disruption that is ubiquitous in today’s global economy can lead to confused, ‘me too’ efforts by businesses to transform. Nothing is more symptomatic of this failing than the bewildering cast of characters that variously present themselves as digital leaders – chief information, marketing, digital, data, customer, technology and digital transformation officers to name but a few. According to research by Digital McKinsey, a third of company executives do not know which leader is responsible for digital and technology functions within their business. In most cases these are either people who have successfully ‘made a play’ for the digital piece or they are brought in to spread some digital pixie dust across some previous perceived success.”

Chris Porter, digital transformation director at cybersecurity and transformation consultancy 6point6

​​​Megatrends changing the world as we know it​​​

​Disruption affecting our lives and businesses is accelerating at an unprecedented rate. Today any movie we want to watch is just a few clicks away. We can buy a new pair of shoes, get takeaway, hire a cleaner, by simply using our smart phones and have it conveniently arrive at our door. Businesses like Spotify, Uber and Facebook are thriving while many well-known brands such as Blockbuster and Borders have disappeared. Here are the six global megatrends that will continue to change the world in 2017 and beyond.  

1. Countries growing and changing​

Geopolitical uncertainty will​ continue in 2017. We will see more dramatic changes increasing instability and fragm​entation, as we have seen last year with Brexit and the US presidential election. Currency fluctuations, differing regulatory environme​​nts and varying consumer views will provide challenges to businesses. More disruption and opportunities will be created from emerging economies in Asia, Latin America and Africa. Increasing middle class means higher spend on services, increasing competition and opportunities to create new markets. In dealing with this ever changing landscape, organisations need to manage risk through diversification, while becoming more nimble, and most importantly having a clear strategic focus.

2. Change in demographics

Population is growing at an unprecedented rate. In 2009 there were 7.4 billion people and by 2040 it is projected to be 9 billion. People will live longer and the ageing will outweigh the working population. By 2050 there will be only two working age people for every elderly person. There is an opportunity for businesses to encourage people over 50 to have greater participation in the workforce by developing digital skills and increasing workplace and retirement flexibility.​

3. New Technologies

As artificial intelligence accelerates, many industries will be at risk of automation. This will see future workforce focus on tasks requiring human strengths such as reasoning and emotional intelligence. Growth in the wearables market will continue and will be more entwined in everyday fashion. Conductive fabrics or sensor-clad smart garments will become more wide spread, while ingestibles will gather mass amounts of information on our health. 
Customer expectations will continue to increase with the acceleration of the Internet of Things (IoT). 50 billion devices are expected to be connected by the year 2020. The future is 'smart homes and cities' with near limitless network connectivity of everyday objects such as phones, appliances and cars. Organisations that are able to connect experiences through all touch points will continue to differentiate and engage consumers.

4. Customer experience and expectation​

Customer's expectations continue to increase. Experiences that surround a product or service are as important as the product itself. They expect these experiences to be personalised, consistent and available across all channels, both digital and analog, from anywhere at any time. A unified view is essential. Success depends on how well these channels are organized and connected to deliver a seamless experience.

Customers expect to be treated as individuals and have everything they need, when they need it. Their ability to self-service and customise the experience is crucial as they want to be more informed and in charge of how they engage. Not every customer wants to come to you for simple queries, and prefer to learn and help themselves. As a result businesses need to provide flawless support 24/7.

5. Big Data

'Big Data' will continue to play a key role in business' ability to deliver great customer experiences. The volume of data will grow even more with the increase in new technologies such as wearables, mobile devices and the IoT. However having big volumes of data isn't necessarily better. It's what businesses do with the data that's important. An opportunity exists for businesses to translate the data into actionable insights. One of the biggest expectations from customers will be receiving answers or an approval for an application straight away using real-time data collection and analysis. Businesses that are not quick to respond will lose new and existing customers to competitors.

6. New Business Models

Today new business models and disruption almost go hand in hand. In the last few years we have seen the rise of new models including:

Subscription and shareconomy based models which have created new forms of revenue generation. Think Netflix, Uber, Airbnb and HelloFresh.

The freemium model, which allows customers to have a basic service for free and then pay to upgrade, has allowed businesses to build a large customer base. We have seen this implemented successfully by Dropbox, LinkedIn and Spotify.

The democratisation of coding, crowdsourcing, peer-to-peer lending have enabled numerous start-ups with great ideas to take-off. More innovative and disruptive ventures are expected to develop, disrupting businesses globally. Businesses need to continuously be at the forefront by becoming disruption thought leaders.

At its core, the societal and technological shifts above are resulting in two things:

1. A consumer revolution sparked by their connectivity to everything, anywhere and anytime. As a result of which customers demand constant, convenient and personalised experiences

2. Tremendous changes in the ways businesses are conducted to stay ahead in the growing market competition

Regardless of your personal opinion these changes will and are changing the face and pace of business today. The question then remains is how your business can continue to increase their scale, offer security and stability, while being nimble and able to predict and respond to market opportunities.

Connecting the dots and being able to navigate change starts with awareness. Computershare has worked with many organisations on creating an appreciation of these macro trends and their implications, alongside solutions to ensure a relevant place for our clients now and in the future.​

GENERAL MANAGER DIGITAL & SOLUTIONS

Lisa McAndrew