Why companies need a digital transformation strategy – MuleSoft

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The hottest trend in business. A recent survey by MuleSoft found that 97% of IT decision makers are involved in digital transformation initiatives at their respective organizations. But what exactly is digital transformation, what are the benefits and why is it so essential to so many businesses? The story of Netflix and the last Blockbuster shows that digital transformation can sometimes be the choice between becoming a business icon and becoming extinct.

Tourists from around the United States snap selfies in front of the BlockBuster store on N. Revere Avenue in Bend, Oregon. In March, after a Blockbuster in Perth, Australia closed, the Oregon store officially became the last of its breed.  “It’s a piece of history that I never got to experience,” Cole Stephens told CBS News reporter Jaime Yuccas, “so it’s kind of fun to come and check it out.” The owners say the store is still profitable, but joke that if DVD rentals decline, they can always turn the store into a museum.

The factors that led to Blockbuster’s disruption are driving business and technology leaders to embrace digital transformation in droves, even if it means overcoming a host of challenges. Ask a leader of these organizations what they want from their transformation, and they will say they want to become as agile as Amazon, as innovative as Google, and as iconic as Netflix. For many, this requires ambitious change initiatives, both technological and organizational. They must adopt not just one new technology, but many, and learn to see their business from the outside-in. Software must become a core competency, and they must develop the ability to use data as a differentiator.

No wonder most digital transformation strategies  end up being complex and messy. Many companies focus on the “what” rather than the “why” and “how.” They launch projects to accomplish everything from the digitization of paper records to sweeping reorganizations of global businesses. In doing so, they fail to grasp the essence of what makes digital transformations different from large-scale technology shifts they have undertaken in the past.

Adopt not just one new technology, but many

Unlike the move from mainframes to PCs, the Internet, and the cloud — digital transformation is not centered around one single disruptive technology. You cannot buy a digital transformation off the shelf or cobble together a best-of-breed solution. Expertise is hard to come by. Transformation requires a constellation of new skills. Just understanding the impact of new technologies on a particular line of business can be daunting.

And the rub of digital transformation is that learning the ins and outs of new technologies is not enough. To thrive in the digital age companies must realize that digital products are experienced as much as they are consumed and must reimagine these experiences from their customers’ viewpoint.

See your business from the outside-in

The lesson from the demise of Blockbuster is not that it chose the wrong application monitoring product or CRM. Perhaps Blockbuster’s biggest misstep was that it failed to recognize that it was no longer in the DVD rental business. From its customers’ perspective, Blockbuster was a provider of home movie viewing experiences. As broadband spread around the world, increasingly customers had new options for those experiences provided by web-enabled, software-savvy businesses.

In 2010, three years after the Netflix began introducing video on demand, Blockbuster declared bankruptcy. The next year, Marc Andreessen published his landmark op-ed in the Wall Street Journal, “Why Software is Eating the World.” Andreessen argued that “we are in the middle of a dramatic and broad technological and economic shift in which software companies are poised to take over large swathes of the economy.” The gains from successive technological advances had compounded, and “all the technology required to transform industries through software finally works and can be widely delivered at global scale,” Andreessen wrote.

Develop software as a core competency

It was a core insight that many have failed to grasp. It isn’t enough for businesses to use digital solutions. Going forward, the most successful companies will be those who are able to produce and deliver software as a core competency. Even Netflix was initially slow to react. It was still sending out its trademark red envelopes when Amazon introduced video-on-demand in 2006, and Hulu launched its online streaming service. In January 2007, when Netflix finally unveiled “instant streaming,” it offered only 1,000 titles. Such a small selection had doomed the first generation of download services. But with Netflix, there was a crucial difference.

Reed Hastings, Netflix’s CEO, understood the fundamental opportunity and benefits offered by digital business. Better software didn’t just make companies more efficient; it allowed them to evolve. Starting with the company’s launch, Netflix had maniacally gathered customer input through focus groups, endless A-B testing, even observational visits to their homes. The data drove the design of the website and business decisions, everything from pricing to the location of distribution centers to support faster delivery. However, the innovation that made Netflix hardest to beat was its ability to help customers find movies they loved.

Make the most of your data

The Cinematch algorithm was the result of years of refinement. Initially based on customer rankings, it grew increasingly sophisticated over time. It clustered customers who liked similar movies together, analyzed that data and observed how a particular cluster reacted to a particular movie. The launch of the streaming service provided even more data for the algorithm. In addition to preference information gathered from a customer’s queue and ratings, there was now behavior information—when customers watched a movie, whether they quit after five minutes or forty, which scenes they watched repeatedly, which they skipped over, and more.

Netflix now boasts the world’s largest streaming service. At the end of 2018, it had more than 117 million subscribers, including 58% of all pay TV subscribers in the United States. It also offers one of the premier case studies for digital transformation. It’s no accident that Netflixed, a 2012 book written by Gina Keating, made it onto Fast Company’s list of 12 books business leaders should read in 2019.

Manage change one project at a time

Netflix transformed a traditional business of sending packaged goods in the mail into a digital experience. But they didn’t become a software company overnight. They moved forward one project at a time, gathering feedback that was then used for the next initiative. Business and IT leaders who are overwhelmed by the scope of their digital transformation initiatives can take heart. Like Netflix, they can create code and build competence and benefits incrementally, acquiring an understanding of how software and digital tools can help their lines of business through a series of successes based on feedback acquired over time.

A key ingredient in Netflix’s digital transformation strategy was their use of APIs within their software landscape, both as a gateway for third-party developers to develop applications for customer experience platforms, as well as components at the core of their internal service delivery systems. We will describe the different benefits APIs can bring in the next section, “How APIs can focus your digital transformation.”

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“Indian Footwear Industry”; a Perspective | by: Adesh Gupta | ET Retail

“For the Indian footwear to explode and deliver, favorable government policies, infrastructure, removal of high doses of taxation, infrastructural support in capacity building, skill education and technology up gradation, brand building exercise should be initiated expeditiously no later than now”… 

India is the largest global producer of footwear after China, accounting to approx 13% of world footwear production, which is close to 16 billion pairs. This means that the average consumption globally is about 2-3 pairs/person. India produces approximate 2,000 Million pairs annually in different categories of Footwear. India exports about 115 million pairs, thus nearly 95% of its produce meets its own domestic demand.

With an estimated global population of 7-8 billion, India constitutes a share of approx 15%, which means 1.2 to 1.3 billion feet needs to be covered from heat, cold, injuries, protection etc. Footwear sector is a very significant segment of Leather and Non Leather products in India.

Size of Indian Domestic Footwear Industry is estimated to be worth 20-25,000 crores where leather and non-leather Footwear per capita consumption is estimated to be approx 1.1 pairs. In addition to this, Slippers (Hawai Chappals)segment is close to 10000 crores with per capita consumption are estimated to be 1 pair.

Our immediate Asian Neighbors reflect good per capita consumption between 3-4 pairs, whereas the developed nations such as US, EU, UK etc. enviably enjoy a far better per capita of 7 to 8 pairs.

The challenge for Indian Footwear Industry is lit large but anticipating India to become amongst top 5 Superpowers in 2030, our consumption rates can reach as high as 7-8 Pairs. In such a scenario, India would need to produce anywhere between 8-10 billion pairs consider yearly population growth.

Consolidating mid-term status by 2020, the potential target for Indian Footwear Industry will equalize consumption pattern of 3-4 pairs. With six/seven years to go, we need to scale our production from current level of 2 billion pairs to nearly 5 billion pairs at a CAGR rate of 30-40%.

Favorably for us, India ranks No.1 in milk production & we have the largest resource of cattle population in the world. Additionally, on the strength of raw material available domestically, the large pool of skilled and unskilled manpower, we have all the capability to take this challenge head on.

Given this backdrop of homogeneous potential it would not be an exaggeration to say that Footwear Sector is today, on engine of incremental growth. With global integration of Indian Industry, rapid change in lifestyle, income growth at bottom of the wealth pyramid, Footwear industry is expected to grow leaps and bounds.

Sadly, overall industrial growth remains moderate and is struggling to take off due to lingering on infrastructural constraints. For the Indian footwear to explode and deliver, favorable government policies, infrastructure, removal of high doses of taxation, infrastructural support in capacity building, skill education and technology up gradation, brand building exercise should be initiated expeditiously no later than now.

Six Ways You’re a Workplace Bully Without Even Realizing It

Leading with Trust

Mike RiceBullying has been on primetime display this week as basketball coach Mike Rice was fired from his head coaching job at Rutgers after a leaked practice video showed him pushing, grabbing, throwing balls at players, and cursing them with gay slurs. As a youth sports coach for over 15 years and the father of a 20 year-old college student, I was sickened at Rice’s conduct. There is absolutely no room for that kind of behavior in sports, school, or the workplace. Leaders have to be held to a higher standard.

Bullying is not just verbal or physical intimidation of someone. Especially in the workplace, bullying can manifest itself in many subtle ways. Any behavior you use to intimidate, dominate, embarrass, harass, or purposely make someone feel inferior could be considered bullying.

Here are six subtle ways you may be acting like a workplace bully without even realizing it:

1. You are condescending – When…

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Asia’s Century: Where and How to Win in Asia – BCG, by:Larry Kamener, Ross Love, Jim Minifie & Tom von Oertzen

Asia’s century has arrived. Asia is the world’s largest and fastest-growing regional economy.

By 2030, its real GDP is expected to more than double to US$67 trillion, outstripping GDP projections for Europe and the Americas combined. Its growth stems from three phenomena. First, Asian economies have sustained high investment in infrastructure, housing, industry, and human capital. By 2030, real investment in Asia could rise to as much as US$22 trillion per year. Second, Asian economies are increasingly sophisticated and integrated across the region and the globe; intra-regional trade in Asia has tripled since 2000. Third, rising household incomes  are causing a surge in consumer demand for a broad range of products and services.  Indeed, real consumption may reach US$45 trillion per year by 2030. This enormous growth raises the question, how can companies outside the region capture the Asia opportunity?

In Australia, many companies in the resources sector are already benefiting from the boom fuelled by Asian demand. But given the scale of growth, it is clear that untapped opportunities exist in other sectors, too. To find out where, The Boston Consulting Group conducted in-depth interviews at 13 leading Australian companies that operate in Asia outside the resources sector. Our findings offer valuable insights for companies around the globe that have an eye on the Asia prize.

Asia: Local Differences, Regional Advantages: 

The companies we surveyed demonstrate that there is no pan-Asia approach to entry and growth. Cultures, economics, demographics, and business practices differ widely across the region. For example, Japan’s slow-growth, technology-driven economy contrasts sharply with Vietnam’s high-growth, low-labour-cost economy. Asian consumers are different not only from Australian consumers but also from their peers in neighbouring countries—and even in different provinces within the same country.

Nor is there an approach that all companies can take to capture the Asia opportunity. Each of the Australian companies we surveyed has developed its own strategy, making smart overtures into Asian markets in the last few decades and reaping the rewards. Each faced its own challenges, but some common themes emerged. (See the sidebar below.)

The Australian Success Story

To understand Australia’s success in Asia outside the resources sector, first look at the following three core Australian capabilities:

  • A sophisticated skills and services sector
  •  A geographic advantage in the region
  • The ability to add value to natural assets such as grain and wool

Then consider how those capabilities intersect with the underlying drivers of Asia’s economic transformation:

  • High levels of investment in Asia are creating opportunities for Australian companies to participate in infrastructure development, the financial sector, human-capital investment, and resource development.
  •  The increasing sophistication and integration of Asian economies are creating opportunities for Australian companies to provide professional and technology services to Asian customers and to deploy transport and logistics capabilities to facilitate the linking of Asian economies.
  •  Growing consumer demand in Asia is providing avenues for Australian manufacturers of health care and pharmaceutical products. In addition, some Australian companies are developing new businesses to attract Asian tourists and are servicing the Asian demand for quality food products.
  • These drivers of growth in Asia, together with Australia’s capabilities, translate into nine specific areas, where companies must focus their efforts in order to succeed in Asia.

For all these organizations, Asian businesses are central to overall success—and most are already valuable financial contributors. Without exception, the companies we surveyed believe that entering Asia has strengthened their position and made them more productive and resilient. They have built their Asia businesses through such efforts as developing their staff; building scale; investing in capacity, technology, and intellectual property; and diversifying their cost and revenue bases.

To unlock the secrets to their success, we asked each company about its customer value proposition, how it achieved growth, and the key to its operating model in Asia. From our discussions, we concluded that companies that have succeeded in Asia have tailored their business models to reflect the importance of customization, relationships, and adaptability.