Industry Pundits Look at Digital Disruption

destruction-2584744_6401We live in a digital world…and it’s only going to get more digital. With that reality in mind, I’ve wanted to dig deeper into the topic, particularly as it relates to the high-tech industry.

That’s why I was excited to see an invite from my alma mater, Georgia Tech Scheller College of Business, to attend a Digital Disruption panel moderated by Maryam Alavi, dean of the school. The participants were:

  • David Godsman, chief digital officer, The Coca-Cola Company
  • Dr Saby Mitra, senior associate dean of programs, Scheller College of Business, and
  • Michael Sutcliff, group chief executive, Accenture Digital.

The panel tackled a range of questions thought-provoking ways. Here’s some of what was discussed:

What happened to the big companies that took over their industries in the past? How come they got disrupted and went out of business?  

The classic example is Kodak. The well-known camera company was once the leader photography.  a monopoly in the photograph printing business, but achieved high profitability. Eventually, the advent of digital photography eroded the company’s market share. In the late 1970s and the early 1980s, Kodak did try to innovate but didn’t do enough because:

  1. The company didn’t anticipate how big the digital revolution would be.
  2. The company’s high margins made them lackadaisical and slow to adapt.

Another major story is Blockbuster. As a newlywed, going to Blockbuster was a pre-weekend ritual. We got a movie and were charged for a full week’s rental even though we kept it only a couple of days. Even then, that seemed unfair. Then, Netflix came along and Blockbuster leadership wrote the newcomer off a niche player. Big mistake.

Now, Walmart is staring into the jaws of commerce giant Amazon. They may find themselves unseated if they don’t retool. They have some real advantages, including numerous well-placed stores that could allow them to offer competitive delivery services. At the same time, there are some things Walmart needs to do to survive:

  1. Retool stores to fulfil orders effectively. The company should carve out a portion of brick and mortar stores to operate as e-commerce distribution centers.
  2. Download online orders and match the customer zip code to the closest Walmart location to get products and customers in close proximity.
  3. Adopt a Distributed Order Management system that reflects inventory available at all the stores so that orders could be forwarded to a location that has the optimal inventory position.
  4. Partner with a crowd-sourced delivery model that can get products to customers efficiently and at the lowest possible cost.

What are the some of the things the incumbents need to do to stay relevant, avoid disruption, and even become a disruptive force?

Mitry offered three pieces of advice for incumbents who want to stay relevant:

  • Simplify: Simplify everything with an eye to being nimble and agile. A small boat is easier to turn than an ocean liner. Staying lean and mean makes things easier.
  • Adopt cloud extensively: Adopting cloud-based technology makes the organization lean, since a good portion of IT infrastructure maintenance can be out sourced. Obviously, this is easier said than done. IT employees resist it for fear of becoming unnecessary.   Meanwhile, retailers often take the rout of building rather than buying in order to keep a strong handle on data security. That’s an understandable concern considering how many retailers have been in the news for breaches lately.
  • Follow a balanced approach to disruption, also look at acquisitions. Even though Google has achieved steady organic growth, the company also made several acquisitions (including Google Voice, Android, and Youtube). The balanced approach needs to focus on running their current business in the best possible way, while also looking out for hot technology coming up in their space.

Mitry also suggested that big organizations should avoid doing heavy customizations to their business in terms of IT infrastructure. If they get stuck in their own way of doing business. it is almost impossible to get out it.

How does current disruptors stay that way? For example, how have Uber and Amazon continued to lead the disruption without somebody else disrupting them?

Focus on stickiness. for example, Uber’s business model is not at all sticky. As a customer, if Uber frustrates me, I can switch to Lyft without hesitation. Amazon, on the other hand, offers Amazon Prime, offers the best delivery and my credit card is stored on the site. Most consumers are reluctant to switch.  Further, with Amazon Prime Now, I can get what I need in a couple of hours. Creating an environment where customers come back again and again is the secret sauce.

Is the United States going to continue to stay as the Leader in disruption?

The U.S. is definitely going to continue to lead the disruption, because the Silicon Valley ecosystem is something that cannot be readily replicated in other countries, according to Accenture’s Sutcliff. However, China is catching up and the adoption of mobile payments is catching on there, thanks to the so-called Alibaba Effect. The tight regulatory environment in the European Union hobbles that area. India is making strong moves. One recent example is the adoption of the PAYTM payment service by a broad base of the population, due to Prime Minister Modi’s drive to eliminate black money and formalize as many transactions as possible.

So, what do you think? Is your business about to get disrupted? How are you staying relevant? How are you making sure you are leading the disruption and not the other way around? We’d love to hear your thoughts.

This article was originally published in EBNOnline.com
https://www.ebnonline.com/author.asp?section_id=3743&doc_id=283248

ABOUT THE AUTHOR
Puga Sankara is the co-founder of Smart Gladiator LLC. Smart Gladiator designs, builds, and delivers market-leading mobile technology for retailers, distributors, and 3PL service providers. So far, Smart Gladiator Wearables have been used to ship, receive, and scan more than 50 million boxes. Users love them for the lightweight, easy-to-use soft overlay keyboard and video chatting ability, data collection ability etc. Puga is a supply chain technology professional with more than 17 years of experience in deploying capabilities in the logistics and supply chain domain. His prior roles involved managing complicated mission-critical programs driving revenue numbers, rolling out a multitude of capabilities involving more than a dozen systems, and managing a team of 30 to 50 personnel across multiple disciplines and departments in large corporations such as Hewlett Packard. He has deployed WMS for more than 30 distribution centers in his role as a senior manager with Manhattan Associates. He has also performed process analysis walk-throughs for more than 50 distribution centers for WMS process design and performance analysis review, optimizing processes for better productivity and visibility through the supply chain. Size of these DCs varied from 150,000 to 1.2 million SQFT. Puga Sankara has an MBA from Georgia Tech. He can be reached at puga@smartgladiator.com or visit the company at www.smartgladiator.com. Also follow him at www.pugasankara.com

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