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[YDM Week@nd] Surviving through Digital Disruption

19Feb2016

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daily Pulse
02.19.2016 No. 32
Surviving through Digital Disruption

Trend

Connected World

According to the latest Ericsson Mobility Report, there are now over 7 billion mobile subscriptions globally, and more than 90% of the world’s population will be covered by mobile broadband networks by 2021. In other words, technology is connecting people ever more closely especially with mobile revolution. Today, the connectivity reaches beyond people and places, towards things; Ericsson predicts that there will be 26 billion connected devices by 2020. With digital connectivity becoming a starting point for new ways of thinking and collaborating, business processes and value chains are reshaped and digitalized, fueling new opportunities never imagined before.

Fast Changing Market

Since the year 2000, over half of Fortune 500 companies have merged, been acquired, or gone bankrupt. Their place has been replaced by digitally-driven businesses such as Facebook, Uber and Airbnb. Whereas the industry was never without changes, the rate of change is accelerating dramatically especially due to the disruption brought by digital transformation. Media and advertising industry is particularly affected by these changes, and the ones lagging behind are exposed to fatal situation. It is pivotal to stay ahead of the disruption by implementing innovative skills, ideas and processes throughout the entire organization.

Insights

Digital Transformation

Digital is transforming the ways in which consumers and businesses connect with each other. Consumers now have more channels to voice their needs and wants, and the opportunities to have control over their own customer experience have increased. These changes regarding the relationship between businesses and their consumers in mind, digital transformation has two fundamental meanings for digital marketers: 1) Marketers need to consider innovative ways in offering campaigns and brand promotions through various online channels in order to encourage customers to engage with the brand. 2) They need to maximize the effectiveness and profitability of data as a way to excel in targeting audiences and sending marketing messages that are relevant to them. In order to achieve these, holistic changes to organizations are required, including business models, strategy, marketing and operation, all enabled by new technology.

Key Requirements for Successful Digital Transformation

Digital disruption brings both opportunities and challenges for businesses. When faced with disruption, the most basic ways organizations do business are being called into question. Businesses need to be prepared for the changes which may come at them in unexpected ways. Here are a few key points for successful transformation to digital and surviving through disruption.

Transformation Involving the Entire Organization
Digital should not be limited to a select few members of the company. Instead, the entire organization need to implement digital mindset to embrace the change, risk and opportunity. The transition from analogue to digital delivery channels require people with entirely different skill sets to work together. Cross functional collaborations are essential as all parts of the business unit are becoming interdependent. Organizational restructure is necessary to share different skills, data, ideas and know-hows for making innovative progression. Organizations need to create an environment that fosters collaboration and experimentations so that members can understand each other’s capabilities and foster innovation.

Digitized Platform for Competitive Advantage
With the availability of alternative brands, products, and services proliferating, businesses need to consider ways to differentiate themselves from competitors. Digitized platform will allow organizations to automate and facilitate business processes so that they can focus on innovation and customer intimacy. Creating values that are not replicable by focusing on attributes such as tacit knowledge, sound management of assets and customer relationship management will provide competitive advantage and opportunity to sustain the business successfully.

Editor's Note

No matter how advanced a company’s technology is, if the people who utilize it cannot deal with the rapid change, successful implementation can be hardly achieved. Successful injection of new thinking requires organizational culture that encourages creative thinking as well as each member’s agility to embrace changes. This way, businesses will be able to survive and thrive in the age of digital disruption.

ydm's View on This Week's Theme by Key Koowhan Lee, Center Chief, Innovation Center, YDM

“Only digitalized businesses can survive.” This sounds rather obvious these days. While PC significantly changed the ways in which information is created and delivered, smartphones caused consumers’ everyday lives to be digitalized. Since digital transformation is a must, not a choice, businesses need to develop organizational culture that successfully injects digital thinking.

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