mba masterclass ag - steven ten napel
TRANSCRIPT
ISVs – software is their business
Enterprises – use software to run their businesses
Is this a valid differentiation in today's world?
Artificial Silos
If it is not, what does it mean to either in terms of competencies and/or business models?
Ford – sells computers on wheels
DreamWorks – technology company in the business of animation
Fedex – a logistics company that runs a software company inside Fedex
Consider today's Business landscape
Xerox – a photocopying company that is into document management and workflow solutions
“Growingup,Iusedtoworryaboutmakingandsellingmorecars;butnowIworry,whatifweonlymadecars?Justmakingcarsisnotourfuture”– BillFord,ExecutiveChairman,FordMotorCo.
“Innovationintheautoindustryincreasinglyinvolvessoftwareandelectronics.Thestandardestimateisthat60percentofvehicleinnovationisnowsoftwareandelectronics,butwetendtobelieveitisevenhigherthanthat” PatrickMilligan,Ford’sseniormanagerforvehiclesolutions
Innovation at work - Ford’s future is driven by
Connectivity
Mobility
Ford’s “Smart Mobility”
Customer Experience
Autonomous Vehicles
Big Data and Analytics
These technology drivers are not unique to Ford and are equally applicable for any enterprise
that aspires to transform its business and handle digital revolution
What’s driving these diverse companies ?
Ford – every automobile it builds has sophisticated electronics with advanced logic and real-time computing power that monitor and drive every component in the vehicle
DreamWorks – uses latest technology to transform animation into a “manufacturing line”Fedex – hundreds of developers build various products that generate and use data on every package it ships in real-time
Xerox – transformed itself into a full-fledged computer services company
Mature competencies in technology, specifically computing and software are at the heart of these businesses
Software IP is driving innovation across these companies
Even though they are not ISVs, they build, own, and support software (IP)
They have transformed their traditional businesses into cutting edge technology hubs embracing agility and innovation
SMAC, Big Data, AI, IOT, and robotics – are transforming how traditional businesses function
People, technology, and processes both internal and external getting transformed
Disruptive Innovation is the order of the day
Technology innovation is creating new business models and generating new revenue streams
Enterprise IT will also change the face of ISVs
IOT is changing the face of manufacturing
Digital Transformation and Innovation Strategy are key business drivers
Enterprises will generate terra bytes of data, which can be used by them to create new applications, service lines and revenue streams in a proprietary manner
New Business Models and new revenue streams
GE – outfitting industrial machinery with sensors – generates real-time data leading to a new business line offering predictive maintenance plans
Xerox Workflow solutions – serving the BPO domain; new business and revenue stream
Fedex SenseAware – in package sensing device, service to healthcare and life sciences companies
Ability to deal with technology and software in a sophisticated manner is at the heart of all the enterprises that have handled the challenges associated with digital revolution and successfully transformed their businesses
Failure to embrace innovation has a very high cost - Kodak is a great example of an iconic company failing due to its inability to adapt
You don’t have to be a startup to embrace innovation, as giants like Ford, Disney, and Xerox have proven
To successfully navigate the challenges of the digital revolution, every company has to embrace innovation, and transform itself into a software company
Companies will have to undergo a fundamental business transformation
Companies must embrace an organisational transformation to embrace risk, innovation and flatten the decision making processes
How can companies become software IP factories?
“Enterprise IT mindset” must be transformed to a “Product mindset”
Engage with mature IT service partners to facilitate this transformation
Decouple the management of customer-centric front-end systems and applications from the management of existing transaction-oriented back-end systems
Deploy state-of-art digital practices for the front-end, consumer-facing applications
Adopt 2-speed IT strategy
2-speed IT strategy will enable enterprises to build innovative products and services capable of delivering great customer experiences
To overcome shortage of right talent in their native countries
Faster scalability, optimized costs, de-risking operations and access to diverse skilled talent pool
Opt for Distributed software development
Leverage 24x7 development cycles with multi-location, and multi-time zone facilities
Proximity to emerging, fast growing markets
Build the right team
Leverage Agile methods such as Scrum
Keys for Optimized software development with distributed teams
Utilize cloud-based tools
Adapt cutting-edge productivity tools to facilitate seamless communication, workflow, process, and project management
Continuously measure key metrics, and refine processes
In this era of laser sharp focus on core competencies, enterprises don’t have to become IP experts on their own
People outsourcing and/or project outsourcing will not result in any sustainable transformation Resources, and processes driven and controlled by the service provider – low level of integration
Traditional IT Outsourcing is not the answer
Low level of task based reactive output, with little incentive for innovation
Basic, hands off engagement
Rigid in scope, deliverables dictated and controlled by the nature of contract
For developing IP, enterprises need dedicated teams for knowledge continuity
Need partners who can extend their capacity
What should an ideal partnership offer to the enterprise?
As the domain experts, enterprises must be in the drivers seat and not the service providers
Mature and collaborative engagement
Complete flexibility in scope to enable you to react fast to changing business and technology landscape
coMakeIT’s strategic engagement framework offers a mature, collaborative model
Offers sophisticated capacity extension
Strategic engagement framework - Distributed development with In-sourcing
Enterprises are in the drivers seat and control the people, process, and the deliverables
coMakeIT handles all the support infrastructure through its shared services model, and allows the customer to exclusively focus on software and product development
Complete flexibility in scope to enable you to react fast and innovate to changing business and technology landscape