The New Style Of Business : what does Enterprise 2020 tell us?

HP talks about “A New Style of IT”. Of course, IT only exists to serve the business. So, before we talk about a “New Style of IT”, I believe need to characterise a “A New Style of Business”.

 
Reva_NXG.jpgOver the last two years, we at HP have been building a vision of what the Enterprise of the year 2020 will look like. We have published a series of chapters on the different aspects of the Enterprise of 2020. I believe that Enterprise 2020 can help us to define A New Style of Business. 
 
Apps as weapons
In the near future, probably well before 2020, “everything will have an application in it”. A slight exaggeration, perhaps, but expect your cooker, your fridge, your home security, your shopping trolley, your bicycle, and maybe even your toothbrush to have applications in them.
 
And, for many of these “smart devices”, there will be an accompanying smartphone / tablet application. 
 
If your applications are “three stars or less”, your product may well struggle to sell. In other words, unless the applications associated with your product are well rated, it will badly affect your product’s sales. 
 
Which leads us to suggest that “applications will become competitive weapons” - applications in smart devices, applications on smart phones, and application on tablets.
 
Flexible business processes
Are you, or have you even been, “in the business”? In which case, you have probably suffered from the inflexible business process. The business process enacted in software which just can’t be changed, despite it being inefficient or painful for its participants to use.
 
This has to stop. The business process of the future will be viewed not as a fixed, unchangeable thing. It will, instead, be viewed as an experiment; something that can be changed by the business people who own it, who rely on it for their profit margins.
 
Everything is an experiment 
Have you noticed a theme in the two sections above?  - “Everything is an experiment”. Applications will be experiments - put the application out there, see what people think about it, and modify it quickly. 
 
Business processes will be experiments - take your best guess and put that out there. As you learn, adjust to optimise the process and to make it more efficient and painless for its users.
 
In order to treat applications and business processes as experiments we need a fast and accurate feedback mechanism. We need to use structured data (like the click streams in our applications) and human interaction data (like twitter or the comments on key web sites) to give us the feedback to improve our “experiments”. 
 
Big data analysis defined by the business
In future, the business will have access to huge amounts of structured data (including a level of detail that today we throw away because we simply can’t store and analyse it) and human interaction data like twitter, emails, phone calls, and pictures.
 
So, as a business manager, wouldn’t it be great to be able to mine all this information (to improve your “experiments”, for example)? Big problem - we need a data scientist (preferably with a PhD) to create the data analysis (which itself will be an experiment - we’ll try one analysis, modify it based on how it works in practice, etc). And the US is already 190,000 data scientists short. 
 
So, in the future, the business will have the tools to create their own big data analysis. These tools will allow for experimentation - the analysis will not be fixed; it will evolve until it is optimal for the business use to which its put.
 
Sentiment is (almost) everything
Structured data is “hard” - you can’t argue with structured data. Human sentiment data is “soft” - it’s subject to the whims of the crowd. Oh, if that statement were true. We have seen so many examples in the last few years of social-media fuelled movements. The riots of 2012 in London and the other major cities in the UK were organised and amplified by social media. And when the police cottoned onto the fact that social media was being used, the rioters used the very same media to spread rumours that had the police sending resource in the wrong direction. The overturning of Mubarak in Egypt was also fuelled by social media.
 
If whole countries can be changed by social media, think how it could affect products - positively and negatively. I went to Reading Music Festival in the UK this year. Of the 50,000 girls at the event, about 49,500 were wearing Wellington boots and shorts. I asked my daughter, similarly attired, how she knew to dress like that. She said, “we just knew”. “We just knew” turns out to be a “everyone was tweeting about it and it was on Instagram, and stuff”.  But more than that, the places that had the coolest Wellie boots and the best shorts were also  .. “we just knew”. 
 
Humans follow trends. The youth of today (and increasingly, their parents!!) form trends very quickly by social media interaction. As a business owner, we must follow these trends. (My kids tell me that there is nothing as uncool as an “old person” trying to be cool and influence trends online, so I’ll not comment on our ability to actively affecting trends thru social media).
 
Focus on what differentiates you
I have written a lot about how the IT department of the future won’t do everything, so I won’t labour the point here. I’ll just say that IT’s key role in the future is to use IT to differentiate the business. So, IT needs to get the business to tell it where differentiation lies, and then IT needs to ensure it focusses on providing that differentiation. Everything else is an IT management's distraction. 
 
Augmenting humans rather than selling to them brings money
I’m currently researching our latest Enterprise 2020 chapter. It’s on Big Data - Big Data 2020. I’ve worked on a number of the Enterprise 2020 chapters, and there is always a theme that consistently comes thru in all the interviews. With Big Data 2020, the theme that comes thru is that big data will be used to augment humans. The business person of the future will be helped in their email dialogs, the IM dialogs, and in their phone conversation. Relevant information will be found for them. Big data systems will find others in their Enterprise having similar conversations. Big data will track data streams, looking for situations that can negatively affect the business, proactively alerting business people to impending problems. 
 
This augmentation will, I believe, allow a gearing of the knowledge worker, allowing them to be more effective - to make better and more timely decisions.  
 
It's no longer either quality or cost.  Innovation plus quality gives margins 
When I was studying marketing, it was all about either quality or cost - you could produce high quality products and services or you could be low cost. But don’t caught caught in the middle - you’d end up as “road kill”.
 
What we now see is that quality by itself it not enough. If you have an innovative competitor, their innovation will beat you. 
 
So, anything IT can do support innovation is important. Agile development processes are important, as are the concepts of “Everything is an experiment”. 
 
The internet means purer competition. Discuss
My son is studying business. He recently had to write an essay entitled, “the internet means purer competition. Discuss”. 
 
I think the internet does provided purer competition. But more than that, the internet provides a very, very, very, very fast feedback loop. Across the whole world. The latest cool gadget, the latest game, the latest service of smartphones can go from nothing to massive in such a small amount of time (e.g.“Snapchat”) . Without spending a dollar on marketing. I was fascinated to learn that $19b WhatsApp never spent a dollar on marketing. 
 
This means that small businesses can grow large very quickly. And that large businesses can become unprofitable equally quickly. 
 
Privacy and big data
In a recent survey (Pew Research, July 2012), survey respondents could either vote “yes, big data is going to be great” or “no – I’m scared about privacy and big data”. 53% said – yes, big data was going to be great. But 39% said no, they were scared about privacy.

 

Governments, and even states, feel the same way. We can expect a lot of privacy legislation. From an IT point of view, we’ll need tools that allow us, on a per person basis, to combine the government, state, industry and personal privacy preferences when we store, analyze and serve up data.  Non-trivial, and probably, ever changing.

 

There are probably applications of big data that will never we implemented (at least, that the public will ever know about) because of invasion of privacy concerns.
 
What does this all mean for A New Style of IT?
For me, this view of “The New Style of IT” raises a number of questions for IT …
  • Can IT support an app release rate that is 30 times what we have today?
  • Is IT ready for “apps on everything” - or is business computing going to do it instead?
  • What a product manager comes to IT and says, “we’d like to run an experiment with an app and collect the feedback data”, are they ready to support them?
  • Is IT able to analyse sentiment as well as structured data?
  • Do we know how the business plans to differentiate itself, and thus, how will IT will help the business differentiate?
  • In what ways does the business need to be augmented? 
  • Is IT tracking privacy legislation and customer sentiment regarding privacy? Is IT looking at tools to easily enforce any privacy legislation?

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About the Author
Mike has been with HP for 30 years. Half of that time was in R&D, mainly as an architect. The other 15 years has been spent in product manag...
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