conversations on the future of business - technology review
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CONVERSATIONS ON THE FUTURE OF BUSINESS MIT TECHNOLOGY REVIEW CUSTOM + SAP
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The way we discuss, analyze, and make decisions about the world’s most pressing issues is changing. The media at our dis-posal and the changing nature of communications demand that we find new approaches to problem solving. These conversations must move out from behind the closed doors of the boardroom, and into the public forum.
In response, SAP partnered with MIT Technology Review to pio-neer a new way to ask and answer technology’s toughest ques-tions. We offered them up to a smart, diverse, global community of experts. We asked MIT Technology Review readers.
For five weeks during the fall of 2013, we posed challenging, provocative questions on technologyreview.com. And we let the readership of business leaders, innovators, thought leaders, and early adopters sound off on important topics like human poten-tial, insight driven innovation, and the power of networks. The responses were intelligent, thoughtful, and illuminating, as we expected. They ranged from the philosophical to the technical. And they demonstrate the potential of online communities to tackle tough questions.
Conversations on the Future of Business.
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CONVERSATIONS ON THE FUTURE OF BUSINESS MIT TECHNOLOGY REVIEW CUSTOM + SAP
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Sound Off on Customer Centricity
New technologies and models of engagement are rein-venting the customer experience. To be successful with “prosumers” – consumers who are also producers – we need to forge new levels of co-innovation with the “seg-ment of one,” going beyond merely reacting to market behavior to predicting it.
In five years, what will fundamentally change the customer experience as we know it today?The following responses are from the MIT Technology Review audience of
business leaders, innovators, and early adopters. The conversation took place on
technologyreview.com and over several social media platforms during the week
of October 21, 2013.
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“VAUGHN RACHAL
Customer experience in five years will not only be driven by how well one’s offering works but also in how transparently it works with other products/applications. Also, the future of customer experience will include personalized assimilation into one’s life-style, and be differentiated by providing monitoring capabilities that translate into proactive or predictive advice, support, or direction.
This question posted live to technologyreview.com.
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bill_workbar
The line between customer and product will continue to blur. Take beer. Traditionally a beer manufacturer makes a tasty beer product, it gets distributed and customers buy it. The beer product will get made regardless of the customer. With mass customiza-tion and a morph of user generated content into user generated product, the beer company of the future will enable you to have your own blend that you can tweak. Customer and product further getting blurred.
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thisdell
3D technology is going to bring customers inside the retail, travel or product design experience in a way that will disrupt the creation and delivery of those products. Customers will not just experience the product (be it a Starbucks coffee shop or a new car) but will share in its creation in a way that producers may struggle to adjust to. Or, put another way, those producers who learn to bring customers inside the creation of their products will leap ahead in their respective markets.
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aschulman2600
Just about everything. Change will still occur very rapidly. At the same time more information will be available in most every business sector. Advanced analytics will assist in many ways including better prediction. Customers will continue to want more customized products and services. With advances in 3D printing, digital currency transactions and other areas, consumers will be more robust prosumers. MEMS and nano technologies will continue to pro-vide fundamental changes in size, speed and capa-bilities of consumer products, telecommunications, transportation, health care and overall customer experience. The movement to more wearable versus hand held devices may have most significant impact on overall experience.
“ “tillypick
Smartphones will choose the apps we need when we need them and we won’t have to manage the technology, just participate in the experience.
CONVERSATIONS ON THE FUTURE OF BUSINESS MIT TECHNOLOGY REVIEW CUSTOM + SAP
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Before we can accurately answer this question, we must first understand how customers themselves are changing. Empowered by technology, transparency, and an abundance of information, today’s consumers are dictating new terms of modern commerce. They want their voices to be heard. They insist on transacting across multiple mediums. And they expect their needs to be anticipated. They are a demanding lot, and when their needs are not met, they will not hesitate to patronize a com-
petitor, or broadcast their displeasure to everyone they know (and even
some they don’t).
Not surprisingly, this customer revolution is driving change deep
throughout the value chain of most product and service providers. Per-
haps that’s why, in response to our question about what will fundamen-
tally change the customer experience as we know it, @aschulman2600
responded simply, “Just about everything.”
Indeed companies are dedicating entire teams to studying this cus-
tomer phenomenon, even appointing chief customer officers to lead the
charge. And the number-one weapon at their disposal is, without ques-
tion, data. “I think real intelligence about the customer will be applied
to every transaction, experience and interaction,” responded @robfinley.
“Big Data will be at the core.”
But how will this data transform the customer experience, exactly? Our
reader responses can best be summed up by what we’re calling the 3Ps:
Participation, Personalization, and Prediction.
Let’s take participation first. Already consumers expect their feedback
to be incorporated into product development. Many of these so-called
“prosumers” exert influence by reviewing products, “liking” companies,
and sharing impressions over various social mediums. But what happens when companies begin actively courting customers to contribute to all
aspects of the value chain, collecting structured and unstructured data
from a variety of sources to inform everything from the way goods and services are conceived and designed to how they are produced, delivered, and serviced? In this way, the customer experience will be fundamentally
altered, molding itself to ever-changing customer desires and fostering
greater loyalty, faster development cycles, and increased customization.
Which brings us to personalization. When customers are more active participants in the development cycle, they expect to see products and services that incorporate their input and meet their specific needs. How
customer data informs this process is well understood. But these data-driven insights are now being married with powerful custom-manu-facturing technologies, such as 3-D printers, that bring true person-
alization to life. “Customers will continue to want more customized
products and services,” posted @aschulman2600. “With advances in
3D printing, digital currency transactions and other areas, consumers
will be more robust prosumers.”
And finally, prediction. Perhaps @Dog21 captured this best in his re-sponse: “In 5-years Customer Centricity will be like Wayne Gretzky was
in hockey: ‘I skate to where the puck is going to be, not where it has
been.’ There will be so much relevant data, business leaders will be able to predict and alter behavior/decisions accordingly, well in advance of market shifts.”
In five years, the customer experience will be radically different. The
expectations of the new breed of customer will continue to soar. And
they will be looking for opportunities to participate in the development cycle, personalize their products and services, and have their needs pre-dicted. But, fueled by massive new sources of powerful customer data,
companies can position themselves to meet these expectations. And if they don’t, their customers won’t be shy about letting them know.
In five years, what will fundamentally change the customer experience as we know it today?
Customer Centricity: The Definitive Answer
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CONVERSATIONS ON THE FUTURE OF BUSINESS MIT TECHNOLOGY REVIEW CUSTOM + SAP
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Sound Off on Unlocking Human Potential
The future of business starts with your people strategy. In a global marketplace of talent, it’s critical to capture the opportunities presented by an increasingly mobile workforce, the rising Millennial Generation of workers, and new models of work and collaboration.
In five years, what new models of work and collaboration will we see?The following responses are from the MIT Technology Review audience of
business leaders, innovators, and early adopters. The conversation took place on
technologyreview.com and over several social media platforms during the week
of October 28, 2013.
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Bonobo
I predict that the overhead cost of maintaining permanent workers in the US including the health-care and pension costs will lead to large companies farming out more of the routine jobs.
Why maintain an in house staff person to handle a routine task like product flyer or brochure generation when there are lots of contract workers who can follow your format, guidelines and printer or web needs?
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muretsky
There will be a much larger use of contract labor and that labor will be at diverse locations. Communica-tions technologies will be much less of an issue, thus placing more focus on cultural and other human rela-tions. While this will open the door for more diverse and potentially interesting inputs, it will still require attention to unresolved security and privacy issues based upon a combination of legal, technological and personal perspectives.
“ “Mark Hempel
The rise of the digital currencies will play a role in the new models of work. For example, the way content or any product can be modularized and then paid for in micro-payments of even less than a penny.
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Bill Pontikakis
A proper communication model and team building and fostering techniques that will promote collabo-ration need to be at the core of the process in order for those diverse people to work together efficiently and effectively.
“ “jlamirande
I think there will be increasing use of open innovation to address complex technical and process issues.
This question posted live to technologyreview.com.
CONVERSATIONS ON THE FUTURE OF BUSINESS MIT TECHNOLOGY REVIEW CUSTOM + SAP
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Much of the response to this important question was focused on the future of the relationship between employees and employers. Over the last 15 years, we’ve seen how shorter product lifecycles and unpredict-able economic environments have dramatically reduced the number of long-term employees in many industries. And a higher percentage of the workforce now works on a contract basis, from remote offices or at home. So it’s not all that surprising that @KCross asked the follow-up
question that’s on everyone’s mind: “We’re already seeing virtual col-
laboration, but in five years will that mean the death of the office? Why
commute to work when you can connect to work?”
There are many who believe the work commute is an endangered spe-
cies, and many who do not, like @AndyF, who says “the death of the
office is greatly exaggerated.” But we believe the more important ques-
tion is whether economic and technological trends will facilitate the rise
of a freelance economy — regardless of where we work — with self-
organizing ecosystems of flexible, project-oriented labor, driving radical
changes in the way people lead, manage, and work. We believe this is
already happening.
The implications of this shift are profound. Management techniques
will need to evolve quickly, and organizations that nurture creativity and
empowerment are likely to win out over those that rely on command-
and-control. As @BillPontikakis points out, motivational and compen-
sation systems will need to “shift,” striking a delicate balance between
projects that are intrinsically appealing and those that are less attractive
but more lucrative. And of course, new collaboration and social tools
will need to support and enable productivity among these loosely orga-
nized, global talent pools.
The bringing together of multiple disciplines, skills, and cultures through technology could unleash massive waves of creativity and inno-
vation — but only if some basic rules of engagement are established and
systems of governance are in place, for everyone’s protection. Perhaps that’s why @teacher41 had this to add: “The current trend to convert jobs to contract labor will continue and be accompanied by a resur-
gence of ‘unionization’ through the expansion of social media. This ad
hoc grouping will result in workplace changes as a result of short-term ‘unions’ with specific goals.”
Some readers called the workplace of the future a “freelance economy,” others called it a “micro-skills marketplace,” and still others called it a
“Mom-and-Pop Renaissance.” Some saw face-to-face collaboration be-coming increasingly scarce, while others argued for its necessity. But
there is one thing that no one disagreed about: “At the core of work and collaboration are trust and the exchange [of ] information,” says @
bill_workbar. “I don’t see this changing in 5 years, or ever really.” In-deed — but we also believe that the proper technology and resources are needed to engender and maintain that trust, and how companies
leverage those tools to communicate and exchange information with
employees, business partners, and customers will ultimately determine the winners and losers.
In five years, what new models of work and collaboration will we see?
Unlocking Human Potential: The Definitive Answer
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Sound Off on Insight-Driven Innovation
Today, there’s more to innovation than “light-bulb mo-ments.” Emerging technologies such as Big Data, analyt-ics, and real-time computing can provide unprecedented insights into your businesses, markets, and customers. These insights can be an engine of innovation if a busi-ness’s technical, organizational, and leadership architec-tures are structured to “trust the data” to drive decision-making at all levels.
What are the roles of instinct, experience, and gut in a data-driven innovation culture?The following responses are from the MIT Technology Review audience of
business leaders, innovators, and early adopters. The conversation took place on
technologyreview.com and over several social media platforms during the week
of November 4, 2013.
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Patricia_Ryan
Each industry is unique. In healthcare, a complex industry, the roles of instinct, experience and gut are essential. I would argue that the more special-ized the industry the more important those roles are. You can transfer skills between similar industries but healthcare is a beast in and of itself. Experience in the healthcare sector is essential to drive an innova-tive culture.
dtiffany
Big data and analytics make important insights pos-sible but analytics are built on models and all mod-els make some assumptions. Even models that are generated by data are generated from meta-mod-els. However, the problem with models that involve human beings as elements or actors is that human beings do not always obey those assumptions under-lying those models or meta-models. If big data and analytics were all that was needed then we would not have had the financial crisis a few years ago which was partially caused by assumption in models breaking down.
Instinct, experience, and gut let humans see beyond logic sometimes, beyond pure comparison.
“ “vjhe1175
Indispensable. Instinct, experience, gut are the driv-ers of hypotheses.
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Dog21
In my experience, business decisions today are almost always part gut - part science. I don’t think these roles will change much in a data-driven innova-tion culture. At the end of the day, we’re human and will rely on experience, gut and instinct validated by the data - the two will continue to work in sync with each other.
This question posted live to technologyreview.com.
CONVERSATIONS ON THE FUTURE OF BUSINESS MIT TECHNOLOGY REVIEW CUSTOM + SAP
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In responding to a question of this nature, it’s easy to pit human intu-ition against data, comparing and contrasting their relative strengths and arguing in favor of one over the other, the way one might argue for art over science. But while taking sides on this important issue generates interesting and passionate discussion, it fails to take into account a ba-sic truth about decision-making: humans seamlessly combine instinct, gut, experience, and data in nearly every decision they make, both per-
sonal and professional. These capacities are not the least bit mutually
exclusive.
“Experience and gut rely on data to grow,” explains @Phil. “So, I see no
opposition between instinct, experience, gut, and data.”
We agree with this sentiment. However, the ascent of Big Data and
the insight it affords does tip the balance. Data analytics brings new
information to bear, exposes unseen patterns, answers unasked ques-
tions, and even predicts what will happen. In this way, it necessarily
encroaches upon the role of gut in decision-making. And this has pro-
found implications for corporate culture and leadership. At the very
least, decision-makers will need to develop a more open, balanced ap-
proach to strategy, and they must be willing to accept data that contra-
dicts established practices and long-held beliefs.
Of course, not all decisions are created equal, and not all require the
same mix of instinct, experience, and data. “Data will play a huge role
in supporting and validating some types of innovation, but not … dis-
ruptive innovations,” says @mjoel. “As Professor Clayton Christensen
of Harvard Business School puts it, there are three types of innovation:
disruptive empowering innovations, sustaining innovations and effi-
ciency innovations. The sustaining and efficiency innovations can be
tremendously supported by data as they provide leaders with necessary
insights on things like customer preferences, the efficiency benchmarks for various processes, the new customers that can be tapped, etc. But disruptive empowering innovations need divergent thinking combined
with instinct and gut.”
Indeed, innovation will always require risks, some that can’t be quanti-
fied, and some that will demand imagination and insight on a very hu-man level. Data will help shape and guide risk-taking, giving direction and clarity to innovative thinking. It provides a basis for the confidence
that business leaders need in order to assess viable options, select the ones with the highest probability of success, and put them into action
– quickly. But experience and instinct will continue to matter a great deal. In fact, some of our readers argued that experience and instinct are merely data in disguise: the long-term accumulation of both unstruc-
tured and structured information.
Ultimately, business leaders will need to decide in whatever scenario
they encounter just how persuasive data is, how faithfully it can be fol-
lowed, and how comfortable they are ignoring it. Those who master this
delicate balance will be well positioned during this age of data-driven
innovation.
“In my experience, business decisions today are almost always part gut, part science,” says @Dog21. “I don’t think these roles will change much
in a data-driven innovation culture. At the end of the day, we’re human
and will rely on experience, gut and instinct validated by the data. The two will continue to work in sync with each other.”
What are the roles of instinct, experience, and gut in a data-driven innovation culture?
Insight-Driven Innovation: The Definitive Answer
Instinct vs. Data
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CONVERSATIONS ON THE FUTURE OF BUSINESS MIT TECHNOLOGY REVIEW CUSTOM + SAP
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Sound Off on The Power of Networks
Networks of organizations and individuals are transform-ing business and society as dramatically as assembly lines transformed manufacturing 100 years ago – defin-ing new types of relationships, increasing interdepen-dence, and unleashing multiplier effects like “network intelligence.”
What can a network learn that an individual cannot?The following responses are from the MIT Technology Review audience of
business leaders, innovators, and early adopters. The conversation took place on
technologyreview.com and over several social media platforms during the week
of November 11, 2013.
““
legweak85
The value of the sum of the organizations, as opposed to the value of the individual organization. The value of anything, when corrected through the checks and balances of a network (as described above) defeats biases and incorrect assessments.
“ “Daniel Wessel
Anything that takes more than 70 years to learn, pro-vided it survives this long.
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danb
In my mind, the answer is just about anything. In my most optimistic moments, I’m convinced that everything is knowable, provided we can collect and analyze the right data. But the human mind is not powerful enough to sift through the countless variables. Heck, I can’t even remember where I put my wallet half the time. So what can a network learn? How about predicting the future?
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wilhelm woess
It depends completely on the individuals which form a network or are key members of different organiza-tions. When most interesting individuals associate with a network, all those who contribute with their own knowledge as humble (or big) it might be, share with others, gain from other’s interesting perspec-tives and knowledge.
Networks can lead to accelerated learning otherwise probably unachievable, problem solving and new products and services (like articles in MIT TR with their sometimes very interesting comments). Time for individual learning on its own is definitively over, when it has ever truly existed – I doubt it.
Some networks do attract individuals of some use for others, and formed spontaneously however more often they attract only weak knowledge and one-sided prejudice, or plain opinion without much expla-nation or insight, sadly.
High quality journalism is a good example how impor-tant and indispensable good networks of the right people are, without I could not imagine how good articles with substance can be written – you should know best, how important networks are, have been and will be.
This question posted live to technologyreview.com.
CONVERSATIONS ON THE FUTURE OF BUSINESS MIT TECHNOLOGY REVIEW CUSTOM + SAP
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The Power of Networks: The Definitive Answer
We asked this question because we believe that society is on the verge of an unprecedented era of learning. Humanity has always been hard-wired to accumulate knowledge, but while there have been pockets of accelerated learning over the course of history, nothing can compare to the potential of digital networks (both social and business) combined with data analytics.
“In my mind, the answer is just about anything,” says @danb. “In my
most optimistic moments, I’m convinced that everything is knowable,
provided we can collect and analyze the right data. But the human mind
is not powerful enough to sift through the countless variables. Heck, I
can’t even remember where I put my wallet half the time. So what can a
network learn? How about predicting the future?”
Today’s networks include both business and social interactions, making
possible new types of insight and intelligence. Trends and patterns that
could never be detected by human intelligence alone can be made visible
in a network. Businesses can reconfigure suppliers and partners and even
target new markets faster and more efficiently than ever before. But it’s
not just the breadth of new insight that makes networks so powerful.
It’s also accuracy, objectivity, and transparency, all of which increase the
value of the information.
“There is value in the sum of organizations, as opposed to the value of
the individual organization,” says @legweak85. “The value of anything,
when corrected through the checks and balances of a network defeats
biases and incorrect assessments.”
Of course, not all networks are created equal. And not all networks
are designed to yield great insight. Which means that the art and sci-
ence of developing powerful, purposeful networks that connect the right
people, machines, and organizations is becoming a major competitive
differentiator in today’s business landscape. Those who master these ca-pabilities will offer the world something of value.
“It depends completely on the individuals that form a network or are key members of different organizations,” explains @wilhelm woess.
“When the most interesting individuals associate with a network, all
those who contribute with their own knowledge as humble (or big) it might be, share with others, gain from others’ interesting perspectives and knowledge. But some networks attract only weak knowledge and
one-sided prejudice, or plain opinion without much explanation or in-sight. High quality journalism is a good example how important and
indispensable good networks of the right people are.”
What can a network learn that an individual cannot?
CONVERSATIONS ON THE FUTURE OF BUSINESS MIT TECHNOLOGY REVIEW CUSTOM + SAP
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Sound Off on Optimizing Resources Amid Increasing Scarcity
As global competition for resources intensifies, resource optimization needs to migrate from the realm of effi-ciency to the core of an organization’s business strategy. Resource optimization is about more than just planning, predicting, and optimizing your supply chain – it’s also about strategic decisions that affect the future health of the economy and the planet.
How does the ability to instantaneously re-allocate physical resources change the way companies source materials, manage operations, and go to market?The following responses are from the MIT Technology Review audience of
business leaders, innovators, and early adopters. The conversation took place on
technologyreview.com and over several social media platforms during the week
of November 18, 2013.“
“
Networml
Various macroeconomic forces demand that com-panies (large or small) become more fluid in their approach to production, distribution, and planning. This requires more efficient and flexible design elements in making and delivering products. This includes the distribution and delivery of products to distributors and stores that directly sell to consum-ers and major customers. One must plan for crises management ahead of time so as not to disrupt the value chain for any length of time. Alternate plans should be in place to resolve issues that take longer than expected. A company’s ability to adjust to market forces shows: 1) leadership in a specific niche, 2) maturity, and 3) importance placed upon the relationship with distributors and customers. A mobile world demands dynamic solutions.
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duser
The first thing that comes to mind is a dramatic reduction in waste. Imagine a world in which noth-ing goes unused for long. That’s powerful. Beyond that, though, we’re talking about protecting critical resources, not just for businesses, but for the world. That leads to less risk, fewer conflicts, and higher living standards.
So how do we do it?
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Adrian Zolkover
Computerization gives merchandisers the ability to almost instantly be informed about sales of items in branch operations, and what they need to order to replace that merchandise. This creates a much higher level of productivity.
“ “
Ginny00
Companies are likely to create bidding wars among vendors and eliminate any want/need for a true busi-ness relationship based on service, value, trust etc. I fear this type of re-allocation will eliminate the human element to a more automated process.
“ “robfinley
With the ability to shift focus of efforts (like goods) to where they are needed could be incredibly effec-tive, especially in a crisis such as Typhoon Haiyan.
This question posted live to technologyreview.com.
CONVERSATIONS ON THE FUTURE OF BUSINESS MIT TECHNOLOGY REVIEW CUSTOM + SAP
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Optimizing Resources Amid Increasing Scarcity: The Definitive Answer
While it’s true that intangible resources such as creativity and intellec-tual capital are increasingly important in today’s global economy, the availability and utilization of oil, gas, and other raw materials, and of human and technology resources, will continue to shape global trends
for decades to come. In fact, the need to optimize these resources has
never been greater, and the stakes have never been higher, both for busi-
ness and for society.
“Various macroeconomic forces demand that companies (large or small)
become more fluid in their approach to production, distribution, and
planning,” says @Networml. “This requires more efficient and flexible
design elements in making and delivering products. One must plan for
crisis management ahead of time so as not to disrupt the value chain for
any length of time. A company’s ability to adjust to market forces shows:
1) leadership in a specific niche, 2) maturity, and 3) importance placed
upon the relationship with distributors and customers. A mobile world
demands dynamic solutions.”
Indeed, we expect resource scarcity to drive major shifts in global mar-
kets, placing new emphasis on some very specific corporate capabili-
ties. For example, as volatility of raw materials increases, manufacturers
will need to predict supply shortages to reduce risk within their supply
chains. Also, companies will engage in collaborative resource consump-
tion, where privately owned but underused assets can be rented to oth-
ers precisely when needed. All of this is made possible by the monitoring
and management of connections among people, devices, and systems. In
these ecosystems, previously undetected information becomes instantly
visible, creating a new natural resource of sorts, waiting to be tapped.
The technologies to support these scenarios already exist. And the cor-
porate competencies needed to benefit from them are being developed. “Computerization gives merchandisers the ability to almost instantly be informed about sales of items in branch operations, and what they need
to order to replace that merchandise,” says @Adrian Zolkover. “This
creates a much higher level of productivity.”
And the benefits of this efficiency extend beyond corporate earnings. Conservation of resources is also a societal goal—with potential to im-prove quality of life around the world. “The first thing that comes to
mind is a dramatic reduction in waste,” says @duser. “Imagine a world in which nothing goes unused for long. That’s powerful. Beyond that, though, we’re talking about protecting critical resources, not just for
businesses, but for the world. That leads to less risk, fewer conflicts, and higher living standards.”
How does the ability to instantaneously reallocate physical resources change the way companies source materials, manage operations, and go to market?
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An Ongoing Conversation
Please visit the Conversations on the Future of Business site to continue the conversations.
Join the conversation on Twitter #futureofbiz #SAP
As the business world continues to evolve, and technology becomes an increasingly integral part of it, we feel it’s important to continually con-sider the opportunities and challenges that direct our decisions, both professional and personal. It is in that spirit that SAP conducts these Conversations on the Future of Business.
The answers we offer in this report are meant to reflect the insights of an insightful, influential global community. We are thankful that the readership of MIT Technology Review contributed such thoughtful re-sponses. And we hope that this brief synopsis of their answers serves as a catalyst for further discussion.