IT Strategy

Enterprise of the Future: Innovate beyond Customer Imagination

June 10, 2008 by Raj Sheelvant

According to IBM Global CEO Study titled “The Enterprise of the Future”, majority of the top executives surveyed agree that same go-to-market strategies, products and services will not work in the future. Thus, tapping into the new geographic and demographic segments will require a deeper understanding of these customers and a more tailored approach than what’s currently pursued. Innovation beyond Customer Imagination is the second of the five characteristics that define Enterprise of the future (Read the summary of the report here)

In addition to the diverse needs of new markets, CEO s also face rising expectations from increasingly informed and collaborative customers. Customers now have far more sources of information, and the enterprise is no longer the definitive authority. This informed and collaborative customer “can be both a threat and an opportunity,” but many CEO s consider serving the informed and collaborative customer as an opportunity to distinguish their organizations — a chance to justify premium positioning and price.

According to the survey, financial outperformers are currently devoting more than 30 percent of their total annual investments to capture opportunities from rising prosperity worldwide. Over the next three years, these new market investments will increase and outperformers plan to spend 36 percent more to serve these increasingly sophisticated customers

From the survey, here are some of the ways to innovate beyond customer innovation

• Finds ways to make offerings relevant to new markets and increasingly prosperous consumers: Global brands, products and services deliver economies of scale, yet each market has its own culture, needs and aspirations. The Enterprise of the Future constantly experiments and learns how to optimize the balance. It analyzes potential markets to find niches, white space and complacent competitors where it can capitalize on its core strengths.
• Understands timing and network effects: The Enterprise of the Future understands the need to introduce innovation that the market is ready to accept and works to perfect its market-entry timing. It exploits the network effects of early adoption to take a commanding early lead.
• Connects everyone to the customer: Employees at all levels — from designers to warehouse employees — connect with customers through real-time information, online interaction or, where possible, in person. The Enterprise of the Future also develops deep relationships with leading-edge customers and employees — those early adopters who determine market success or failure.
• Uses technology to anticipate shifts faster than the competition: Market insights are critical to the Enterprise of the Future. It recognizes the value of the information it collects through its many channels and actively mines it for insights. It uses emerging technologies, such as virtual worlds, to gain insights in new ways. It also puts systems in place that allow very fast feedback cycles. When customer preferences and demand start to shift, it knows before the competition.

It’s interesting to note that all the ways to differentiate by collaborating with customers as explained above aggrandizes the role of IT. As customers move towards to core of Enterprise of the Future, so does IT. In fact, right implementation of IT is a precursor to success of innovation through collaboration with customers. So, I think the role of IT developers becomes critical in the near future.

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1. The Enterprise of the Future
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4. Enterprise of the Future: Globally Integrated
5. Enterprise of the Future: Disruptive by Nature