What being a technology company means in the age of convergence
It comes as no surprise that the world’s biggest businesses are technology companies. Amazon, Microsoft, Alphabet, Apple, and Facebook have secured their global positions through the constant pursuit of innovative technology. Innovation certainly isn’t all about tech, but there can be no denying that the two are closely linked. The success of tech behemoths has, in part, motivated companies to consider how technology could make their own business better. Industry convergence, open data, software as a service, and diverse consumer requirements mean that every company can – and must – tap into tech.
DISRUPTIONHUB spoke to Michael Rae, Channel Director at Huawei, about what it means to be a technology company in the age of convergence.
Business without boundaries
Rae, who looks after Huawei’s partner network of distributors, resellers and certified service partners (CSP), explains that all industries have become deeply connected. As such, the technology industry no longer stands as a separate sector. It is increasingly difficult, he says, to think of partners as existing outside the technology sphere.
“The boundaries are blurring. As everything is becoming more connected, the more industries are becoming connected to the technology world.”
Leveraging technologies like big data, artificial intelligence, and various forms of automation are critical now that business is characterised by convergence. Organisations need to know what their competitors are doing. As those competitors sit across sectors, the amount of information can’t be processed by human teams alone.
The need for technology is also tied to the evolution of products into services. Again, it’s about boundaries – traditionally, a product was designed, made, sold, and that was the end of it. The relationship between company and consumer was a brief encounter driven by profit. Today, customers want more from brands, and brands want more from customers. A linear supply chain doesn’t enable this exchange, and so the as-a-Service model has replaced it.
Now, customers buy into an ecosystem, and join a network of data points that ultimately creates more relevant businesses. Collecting and understanding these metrics is the task of data analysts, data scientists, and software developers. Not so long ago, these skills would have needed to be outsourced. Today, high performing companies recognise that useful insights are impossible without tech talent, so they have their own in-house technology teams.
No manufacturer is an island
Surely, however, there are some exceptions to this rule. What about traditional manufacturing companies, for example, or small to medium businesses with local clients?
“Companies you traditionally think of as making all kinds of products now need to become organisations that develop software as well, in order for their connected products to be managed remotely,” says Rae. “As an example, people that manufacture cars wouldn’t necessarily have needed an IT partner for manufacturing in the past. But IT now plays a major part in the development, construction and operation of cars.”
Case in point: Ford. Ford Motor Company was incorporated in 1903. It’s about as legacy as legacy can get, but that hasn’t stopped it from maintaining its position as one of the largest automakers by revenue. The company recognises that success in mobility goes beyond conventional cars. Ford’s Smart Mobility initiative, for example, uses partnerships with startups, academia, and fellow manufacturers like VW to gain more knowledge about technology solutions. Ford is still an automaker, but it’s now a technology company too.
To be digital is to be global. The moment a business creates its own website, it can be accessed by many people around the world. Everyone has the potential to be a customer, or a competitor.
By understanding your customers and your competitors. Working out where customers and competitors come from is difficult enough already, without a global backdrop. Failing to integrate technology to seek out data insights makes this an impossible task.
Adopting technology – from cutting edge AI to simple property service management systems – is about being adaptable. When customer expectations, technologies, and business models change at such an alarming pace, adaptability is everything.
“One thing the industry has taught me, certainly in the last few years, is to be open to change, and be adaptable,” says Rae. “Things change incredibly quickly. I’ve been in the industry for over 20 years, and if you’re stuck in your old ways, you’ll get left behind.”
The only way to avoid becoming a technology company, then, is to operate in a limited business: limited, in that one day it will be overtaken by agile competitors. This rings true for all companies in all industries.