Data, customer centric products, and doing business at speed
Established businesses have not had the easiest of rides when it comes to digital disruption. Many long standing companies have been slowed (and in some cases, killed off) by restrictive red tape and a reluctance to take risks. Others have taken a far different approach, and continue to dominate their respective industries. So how can an incumbent take advantage of technology and encourage productive disruption? DISRUPTIONHUB spoke to Angela Bates, IBM‘s Developer Ecosystems and Advocacy Programmes Leader, to find out how a company that was formed over a century ago has remained at the top of its game.
Practising productive disruption
IBM’s success can be in part attributed to productive disruption, which in Bates’ words is the delivery of customer centric products, services, and ways of doing business at speed. But, as is the case for most incumbent businesses, achieving this is no mean feat.
“The key is to get things done as well as you can – it doesn’t have to be completely perfect or plotted out on charts in presentations,” says Bates, who works within IBM’s Digital Business Group.
The Developer Ecosystems team exists in key developer hotspots such as London, New York and San Francisco. Mostly staffed by developer advocates, the group provides a fresh environment where developers can get creative with code and build trusted relationships with community developers. But, as with any long standing company, there are many structures within an organisation that can prevent agile experimentation and implementation. Bates identifies three major obstacles she has faced: the prevalence of ego, doubt, and finally the risk averse nature of big business.
“We are acutely aware that some of what we do might impact traditional revenue streams within the business, but that’s the whole point. There’s always a trade off. It’s important to be honest about the impact that a new product or plan will have, and be purpose bound. The pressure on us as a disruption team is to be able to build that trust both inside and outside the company and focus on productivity.”
Stepping up to startups
Another continuing concern for legacy companies has been the influx of fast moving startups. These lean, flexible organisations can take products to market in far less time than bigger businesses, and have made use of digital channels to connect with consumers on a deeper level. However, according to Bates, incumbents no longer view startups as their biggest concern. Previous waves of technology may have given startups the upper hand, but the growing emphasis on data means that incumbents now have a serious advantage. Young, agile companies may be able to move quickly and adopt new technologies and strategies with fewer obstacles, but when it comes to data, legacy companies come out on top.
“Cloud really gave startups the ability to create apps and small products quite quickly – to the surprise of many larger companies. Now, several years later, it’s data that’s becoming the vantage point,” says Bates. “And who owns the data? It’s actually the larger companies. In fact only 20 per cent of the data is searchable and being used productively, the other 80 per cent is held inside companies, and is generally not being used. Startups don’t have access to the amount of customer data to be able to predict behaviours, or to know retrospectively and in real time what customers are interested in.”
Data is a vital asset, but how do companies make the most of it? How do they leverage this information so that they can respond to customer pain points before their younger competitors? Perhaps unsurprisingly, the answer lies in Artificial Intelligence, and the software developers that Bates aims to engage with in her role in IBM’s Digital Business Group.
“AI is becoming part of the norm in delivering compelling, contextual, personalised digital experiences to customers. It doesn’t matter which industry you’re in, it’s the software developers, data scientists and technologists who can code customer centric capabilities with data that will drive your business forward,” she says. “The developer is the new mover and shaker – they really do have fundamental technology choices to code the most amazing things that can change the world, save lives and save your business. They are becoming an economy within their own right. If we lose the developer, we lose ways of doing business.”
The C word
As well as innovative technology and talented developers, incumbent survival relies on culture. But what does a healthy business culture look like? Bates emphasises the importance of a supportive network, particularly when it comes to senior leadership. Another key characteristic is the ability to collaborate.
“What I’ve personally tried to do is make sure that we deliver as much as possible that’s tangible. We’ve done some really nice work in engaging with developer communities in London through Community events. You need to build face to face relationships as much as you can. The other aspects of our strategy is to share our Code and Content with developers. This includes our commitment to the Open Source Community as well as sharing Code Patterns to give developers a helping hand to build something amazing. That collaboration is really important.”
The challenges are many, but the rewards are clear. Incumbents are data powerhouses, and by investing in AI and attracting talented software developers, they can turn data into a formidable asset. Rather than shying from disruption, incumbents should view it as motivation. Once large corporates recognise the value of those insights, they will build customer centric strategies that leapfrog competitors.
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