Digital Business Is Driving Big Change

Every year, Gartner makes a number of predictions about technology and its impact on business. One session at this year's Gartner Symposium that I found particularly interesting was from VP and Gartner Fellow Daryl Plummer, who discussed his top 10 strategic predictions for digital business. Overall, he said, digital business is driving big changes.

Most importantly, we are moving from a world where people behave the way computers work toward a world where computers work the way people behave. In other words, the technology follows us, we don't have to follow it, he said.

• By 2018, digital business requires 50 percent fewer business process workers and 500 percent more key digital business jobs, compared to traditional models. IT professionals need to think people first, technology second, and that's hard to find. In addition, we don't have enough computer science students and skills to fill all the new jobs we will have, and will need to automate jobs to make up the difference. As a result, he said, we'll need new hiring practices to recruit for the new non-traditional IT roles. He also said machines will take an active role in enhancing human endeavors.
• By 2017, a significant disruptive digital business will be launched that was conceived by a computer algorithm. "A machine will come up with an idea that will put you out of business," Plummer said. Machines have as much information as we do, and there are now new techniques for mining data that let machines formulate ideas for business. He said we will have smarter digital assistants and smart advisors – the combination of a Siri-like front-end and a Watson-like back-end. As a result, CIOs must begin to simulate technology-driven transformation options for business, such as decision simulation engines.
• By 2018, the total cost of ownership for business operations will be reduced by 30 percent through smart machines and industrialized services. This includes things like cloud-based services and the robotic warehouse operations like those at Kiva Systems, which he said can reduce the need for humans and be more efficient. We have to face the reality that jobs will shift due to technology, but that this will really bring a lot more efficiency. This will include a move from coding to training, so they take into account what is going wrong and learn from that. For now, CIOs need to experiment with "almost smart machines" with heuristics for robotic business process automation.
• By 2020, developed world life expectancy will increase by 0.5 years due to widespread adoption of wireless health monitoring technology. This is on top of life expectancy increases we would otherwise see, he said. Examples he included were wearable technology, from consumer devices like Fitbit to more specific things like devices that monitor sugar levels for diabetics. As a result, life expectancy will go from 79 years to 79.5. (I'm personally skeptical we'll ever be able to parse out where technology has the impact, as compared with changes in social and dietary habits.) He said business leaders should examine the impact of wellness technology and programs. But he did worry about how such wearable technology can be invasive, and that such devices can be hacked.
• By the end of 2016, $2.5 billion in online shopping will be performed exclusively by mobile digital assistants. This includes things that go beyond today's Siri, Cortana, and Google Now to applications like eBay's mobile bidding assistant as well as automatic orders for groceries. He said marketing executives in particular need to develop new techniques to capture the attention of digital assistants.
• By the end of 2017, U.S. customers' mobile engagement behavior will drive U.S. mobile commerce revenue to 50 percent of U.S. digital commerce revenue. Plummer said this was the most controversial of the predictions, because the big retailers are only seeing 10 to 15 percent of e-commerce sales coming through mobile today. He said the 50 percent number included marketing with things like coupons on mobile, as well as sales apps and hybrid shopping. Mobile marketing teams need to look at mobile wallets such as Apple Pay and Google Wallet, he said.
• By 2016, 70 percent of successful digital business models will rely on deliberately unstable processes designed to shift as customer needs shift. He said that F16 fighter jets, pizza, and digital business are all designed to be unstable. Drones need software to make them stable and change how they fly on each trip. As a result, these things are "supermaneuverable" compared with stable platforms. CIOs need to create an agile, responsive workforce that can deal with this kind of liquidity.
• By 2017, more than half of consumer product and service R&D investments will be redirected to customer experience innovations. Examples here include FriendShopper, where your friends can suggest what you buy. So consumer companies must invest in customer insight through persona and ethnographic researchers.
• By 2017, nearly 20 percent of durable goods e-tailers will use 3D printing to create personalized product offerings, like customized cell phone cases. This creates a new type of asset for the business- a transitional asset that can change from an intangible asset, such as a blueprint, into a tangible one, such as a physical object. This allows more items in stock without warehousing. Product development leaders need to evaluate the gaps between the current state of 3D printing and future process, skills, and technology.
• By 2018, retail businesses that utilize targeted messaging in combination with internal positioning systems will see a 20 percent increase in customer visits. He said CIOs must expand customer data to support real-time offers, and described options like using indoor positioning location within malls.

All of these items will change our business processes, and will change the way we do business, Plummer said.