One year ago, I wrote about my epiphanies and “ah-ha” moments during the annual IDC Directions event in Boston, Mass. Having been an IDC client throughout my 30 years in tech marketing, I’ve been to many of these events – 28 in fact. Where has the time gone? Truly, it’s been an eye-opening journey through an industry that has radically transformed in ways we couldn’t comprehend when I first started my career.
A few years back, I struggled with finding a top-down, holistic framework for the evolving changes we were experiencing in the tech industry. And then, lightning struck when I was introduced to the IDC 3rd Platform, which I’ve now used multiple times both internally and externally. The “outside-in” explanation of 3rd platform technologies – cloud, social business beyond media, mobile, Big Data, and Analytics – is clear and includes innovation accelerators and key industry cloud platforms. It is also a relatable approach to show my own tech evolution – from first-generation mainframes and second-generation client servers and Internet computing to the modern 3rd platform.
Issues such as scale; complexity; and the classic fear, uncertainty, and doubt (or FUD for the indoctrinated) continue to be real, but the 3rd platform is definitely here to stay. IDC predicts that these technologies will continue to grow at nearly 13% per year through 2020, while second platform technologies will decline at an annual rate of 5%. The danger is resistance to moving forward.
IDC’s chief analyst and SVP Frank Gens uses a convincing slide that superimposes the rise of the 3rd platform with technology vendors that are no longer with us from the previous era – Wang, MSA Software, Cullinet, and Digital Equipment Corporation (DEC, where my career began). To further illustrate his point, Gens shows a clip of a classic episode “I Love Lucy,” when Lucy and Ethel worked in a candy factory and couldn’t keep up with the assembly line. Like our beloved characters, these companies did not keep up – and vanished. Very sobering thought, especially when you consider how the industry landscape has radically changed and continues to accelerate.
First of all, like the classic economics paradox of lining up 100 economists end to end and having them all disagree, we must agree on what digital transformation is. According to IDC, it is the ability to leverage 3rd platform technologies to fundamentally shift all aspects of society. In my humble opinion, this is a pretty cool concept that goes beyond digital content, e-commerce, and online business models. However, this can only happen through transformation – new sources of innovation and creativity that enhance overall experiences and improve the financial performance of organizations. And similar to my early days with business intelligence (BI), it enables us to apply enhanced information for better decision making and productivity of information workers.
But let’s get one thing straight: Digital transformation is not digital technology. Rather, it is based on the use of 3rd platform technologies and key innovation accelerators such as the Internet of Things (IoT), 3D printing, robotics, and cognitive intelligence.
As companies embark upon their own road to digital transformation, the majority will be in two camps – digital explorers and digital players. About 25% will be proactive, forward-thinking transformers and disrupters. A small percentage (14%) will be digital resisters. Now, if you mapped a traditional innovation lifecycle, laggards can be up to 25% of the market.
The message is clear: Resistors and laggards risk obsolescence, just like the technology companies Frank Gens cited in his slide. If you don’t change, you risk being “Ubered” out of existence!
What’s next for digital transformation
Besides the best route to every IDC Directions event in Boston, one thing I’ve learned is to look for the next crop of killer apps or solutions that will drive demand for the next generation of technology with exponential growth and massive demand. The 2nd platform offered spreadsheets, personal productivity applications, BI, and Internet-enabled solutions that redefined our industry.
At this year’s IDC Directions, Gens spoke about two such solutions – the IoT and cognitive computing – leveraging forms of artificial intelligence. When combined together, they deliver continuous sensing and collective learning – two sides of the same coin, leveraging massive amounts of data generated for machine-to-machine communications and machine-based “thinking” behind the scenes to process and share information.
The 3rd platform and digital transformation are indeed all about growth. Yes, the usual mind-boggling growth of the IoT and Internet-connected devices, whose impact is felt across all industries and solutions with an even greater influence on marketing and sales, healthcare, financial services, and retail. However, a massive growth of 50x for cognitive systems and artificial intelligence provides wisdom, context, and ways to interface with each other – as well as deliver innovative solutions with powerful predictive capabilities. And finally, the rise of industry cloud platforms will continue, built on business networks and taking advantage of the network effect in a manner that only accelerates and grows geometrically (Metcalf’s Law indeed!).
Yes, there are many issues to scaling digital transformation – the classic “people, business, and technology” yet again rings true. But no one can deny the opportunities it offers.
Map out your own digital transformation journey. Check out our recent executive research inquiry “Who Will Lead Development of the Internet of Things Inside the Organization?” and join us on April 21 for an hour of insightful thought leadership on this topic: “Webcast Innovation @ Cloud Speed: Unlocking the Potential from the Internet of Things.”