Technological innovation is growing exponentially; how does your company keep up?

By News, Technology

In the coming years, an unusual trend will become steadily more obvious: it will become clear that technological innovation is now growing exponentially rather than via a linear curve. Within ten years, computers will be powerful enough to make as many calculations per second as the human brain. These developments will have a big impact on organizations’ business models.

Companies can’t avoid it; in the not too distant future, all organizations will go digital. If current developments keep growing exponentially, computer power (calculations per second) will be equal to the total calculations of all human brains put together within one generation. Moreover, various new technologies and their uses will have an impact on all sectors, such as blockchain, AI, robotics, Internet of Things and medical wearables.

Exponential, rather than linear thinking

Disruption as a result of these technological developments looms over every organization. Many companies today have need of new business models in order to face this disruption. Focusing on improvements within the current business model, the so-called ‘Horizon 1 and 2’ developments, is no longer sufficient. Continuous attention for new Horizon 3 business models must be anchored in the corporate culture.

There are already a fair few examples of senior management (don’t be that guy) hanging onto their tried and tested business models on the basis of personal experience and expertise. Because of this, they eventually had to deal with total disruption. Competition can often be found where you aren’t expecting it; start-ups use all available technologies to launch new business models.

That’s why it’s important to start thinking about the future now. In the coming years, for example, chatbots will become commonplace in customer service. In the healthcare sector, medical wearables are being developed which can not only cure certain illnesses, but prevent them entirely. The blockchain will eventually be put into use everywhere, cutting out the need for a ‘middle man’. Moreover, Artificial Intelligence technology will be integrated into our existences and will act as our co-pilots.

Prepare for the future

It’s difficult to fully anticipate upcoming developments. The human brain simply isn’t capable to predict and extrapolate such exponential trends. This means that anticipating the specifics is pointless. Set up your organization to be technologically flexible, so that it can quickly adjust itself according to the market.

Don’t stick to just ideas; anchor the technological models in the organization and put them into practice. Firstly, the senior management has to be made aware of the exponential growth curve that will impact all organizations. Then employees throughout the company must be stimulated to think and act in an innovative manner. Of course, this must happen with and for clients. This entails (minimum viable) products being launched cyclically in order to receive feedback as quickly as possible in order to improve. Only organizations that learn faster than the competition will survive.

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How platforms can accelerate the Digital Transformation

By News, Technology

Digitalisation is taking off unprecedentedly, but by no means every organisation is equipped to respond to it. Because companies spend a lot of money on maintaining expensive and inflexible systems, this is ultimately at the expense of customer satisfaction and competitiveness. How can your organisation become effective again?

Digitising is no longer a choice for companies, but a necessity. Consumers want to be helped faster than before. Companies that make effective moves within the market increase their competitive position.The problem is that many companies have little insight into the number of applications. In addition, it is often not known how high the current and future costs are for maintaining all this software. The vast majority of the budget is therefore not spent on innovation, but on maintaining (outdated) IT systems.

As strong as the weakest link

The speed of an organisation is ultimately determined by the weakest link in the chain. This is the (standard) package to which only complexity and therefore time and money is added. Everyone knows that if you add complexity to complexity, problems just get bigger.

In order to maintain a good market position in the future, each organisation will therefore have to spend its IT budget and resources significantly differently. A well-designed IT platform offers a solution and creates more overview, quality, development speed and opportunities for exponential growth. This is how technology helps to control costs and to transform the organisation into a digital organisation.

Unlike monolithic software, which does not facilitate “continuous delivery”, orchestrated software does. Platforms facilitate reuse and compliance so that simple components can be converted into new products. Maintenance is also relatively easy because individual components can be replaced.

Slimming and strengthening

In order to make the IT in an organisation agile and to keep it that way, it is important that the complexity is drastically reduced. The number of applications must be reduced as well. At the same time, knowledge and skills must be gained to build and integrate platforms into the existing infrastructure. The big challenge for IT departments is to carry out this transition while the regular operation continues.

Building a necessary lean and agile organisation does not only require good IT platforms. It is equally important that the management takes real ownership and shows leadership to reduce the existing complexity. A digital business requires a strategic focus on quality, cost control, speed and exponential growth in demand.

Companies wanting to maintain their competitive position will have to develop a culture that can cope with a constantly changing world.

Organisational form under the microscope

Therefore, building up the necessary cultural competences and integrating the software go hand in hand. The organisational form, leadership, mindset and skillset of the employees should be placed under the microscope. This means an existential transformation in which the focus is on subscribing, buying, building and integrating software.

This completely changes the speed and way of working, speaking in terms of weeks instead of years and days instead of weeks, no hierarchy involved. Continuous customer value is created and products are created and only driven by “outcome”. In short, a real agile organisation.

This article is based on the story Andy Kyte told Gartner during the OutSystems Nextstep of October 8, 2018 in Amsterdam.