The Billion Dollar Byte by D. Justhy

Author:D. Justhy [D. Justhy]
Language: eng
Format: epub
Publisher: Morgan James Publishing
Published: 2018-02-18T16:00:00+00:00

Currently, most traditional companies are in the bottom left corner of the chart, opposite the Digital Natives. Traditional companies must approach the “chasm of divide” by operating more like the Digital Natives. Traditional companies need to focus on at least two things to make this journey. First, they must use data-management practices to meet minimum regulatory compliance needs (y-axis). An example of this is the BCBS 239 compliance for banks or the Solvency II Directive for insurance companies. Second, they must improve business process automation and enterprise value (x-axis) for higher growth.

The most effective and efficient way for companies to make this journey is in a straight line, moving progressively from the bottom left to the top right, i.e., striking the right balance. This will move companies away from their current “pain,” as they become digital “evolvers” that have managed to step into the Digital Age. This is the optimal path.

Unfortunately, it is not always the one that companies make when attempting to go digital. All too often, they move from Point A on the grid to Point B, and then to Point C. This often happens because traditional companies base their digital strategies primarily around compliance matters—they look mostly at the data they are required to have on hand to meet compliance and regulatory needs. These companies become “seekers”; they are looking to go digital, but are lost because they aren’t actually increasing efficiency or enterprise value.

Other companies go digital by moving from Point A to Point D, and then to Point G. These companies have invested in business process automation and are building enterprise value, as they should, but by ignoring compliance, they may be branded as “rebels.” They are likely to see monetary success, but may run afoul of regulatory bodies.

Both seeker and rebel companies may eventually evolve and approach the “evolved” status of companies that have become more like the Digital Natives by updating their data strategies for the Digital Age. However, when making the smart choice to go digital, traditional companies should take the most direct path toward the chasm that now divides them from the Digital Natives.

The chasm need only be approached, not necessarily traversed. Traditional companies are not the Digital Natives. They typically run different kinds of businesses. They carved out their niche before the territory that the Digital Natives filled, even existed. The two are not necessarily in direct competition (though sometimes they are). Hotels and insurance companies don’t need to rush out and build the next big online marketplace or social media application. They simply need to embrace the Digital Age by going digital and doing what they do best—the only difference being, doing it digitally.

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