The rapid pace of technological change presents businesses with an oxymoron – it is a huge opportunity wrapped up in an equally daunting threat.

Corporates that embrace the right business technologies can be expected to be rewarded. Those that don’t will be left behind by competitors and ostracised by clients.

So how do you turn business technology into an opportunity rather than a threat?

Acuity spoke with Mohanbir Sawhney, professor of technology and director of the Center for Research in Technology and Innovation at the Kellogg School of Management, ahead of his appearance at the World Business Forum in Sydney.

Major trends

Sawhney says there are three interlocking trends that are impacting most businesses today: cloud computing, the advancement of mobility, and the rise of big data and analytics.

“The reason these three are connected is because mobile devices make the network available to us wherever we are and that is generating new kinds of data, while the cloud allows us access to infrastructure without thinking about where the location is,” Sawhney says.

“This has resulted in a lot of the software and services moving to the cloud. Then analytics allows us to make sense of all of this data in order to make better decisions.”

“Now we are in the era of ‘always-on marketing’ where you are continually creating content and engaging customers on a continuous basis.”

Sawhney says the trends are mirrored in three categories of change in business technology today: customer experience management, operations and asset management, and new business models or marketplaces.  

“On that first category – the customer interface, or the customer experience management – the idea there is that customers now expect personalisation, real-time response and they expect to interact with businesses across any channel they choose,” he says.

“That is an area of both disruption and opportunity as you need to design a channel-agnostic customer experience platform that allows customers to interact with you over social channels or physical channels, and get responses to their questions in a very short period of time."

Front office

Sawhney says one area where he is seeing a lot of opportunity, or a possible threat if you don’t move into it, is the digital front office – redesigning the customer interaction to create a customer experience that is across channels and is seamless.

“This is the most important development for what I call customer intensive businesses. For example, banks, insurance companies, telecom companies, hotels, airlines – wherever there is a mass customer base you are interacting with. That’s when customer service management through technology becomes the most important area,” he says.

Sawhney uses the example of an airline. In the past, when the customer had a problem they might call the airline’s customer service number or speak to an agent at the airport. But now they are likely to tweet, or post to the airline’s Facebook page.

“The ability to detect that something went out on Twitter that was a complaint, be able to route it automatically to the appropriate service department and then be able to respond is uniquely made possible by technology,” he says.

Asset management

Sawhney says the second category of change in business technology is one that mainly impacts industries which are asset intensive.

“These are industries that require a lot of capital assets and very expensive equipment,” he says.

“In Australia, for example, if you consider the mining industry, or if you are looking at chemicals, or heavy manufacturing, oil and gas, or even the automotive industry, you have a lot of machinery, a lot of assets in the field that you want to get better use of and improve the productivity, reduce the breakdown maintenance costs, improve uptime.

”For example, a very expensive piece of mining equipment with sensors on board will now be able to detect when the machine is likely to fail and prevent businesses from having very expensive downtime, says Sawhney, using what is known as operations improvement and asset utilisation technologies.

New models

“The third thing that I see is the creation of new business models, such as on-demand marketplaces, companies like Uber, AirBnB, and others creating these on-demand marketplaces, either for labour or for skilled human capital,” says Sawhney.

“That is a market-level disruption where buyers and sellers are brought together in creative new ways. It also leads to improved asset utilisation. As cars are not used as frequently as they should be, while homes sometimes have excess capacity or a spare room.”

Sawhney says we are going to see the sharing economy and more on-demand marketplaces created, sparking a business model or market-level change.

Building a technology toolkit

Taking note of these trends and making sense of how they apply to any given business helps in the creation of a “technology toolkit” for a given corporate.

Sawhney says when putting together this toolkit, the first area for a business to think about is how they interact with customers.

“How are you managing all of your interaction channels? Today there are over 20 social channels, there are LinkedIn, Pinterest, SnapChat, Facebook, Twitter. Customers can choose to interact with you on any channel.

“Understanding what your social interaction platform looks like, and getting a unified customer experience platform, is a very important and urgent task for companies,” he says. Sawhney explains that the second thing to look at is data.

“What are you doing with your data? What is your analytics capability? How are you building models that will allow you to predict what customers might buy, or what things they might have?”

Taking note of these trends and making sense of how they apply to any given business helps in the creation of a “technology toolkit” for a given corporate.

Another major area of business technology where results are already being yielded is in marketing. Sawhney explains that business technology is changing marketing approaches significantly.

“Marketing used to be a creative endeavour that was done using intuition, and it relied on a few large campaigns in a year. But now we are in the era of ‘always-on marketing’ where you are continually creating content and engaging customers on a continuous basis,” Sawhney says.

“So the marketing message is no longer a few advertisements you run a few times a year, but it is a constant stream of relevant, timely and useful content that you provide to customers.”

Sawhney says that content is not necessarily related to products or services, rather it is related to issues, problems or concerns customers might have.

“It is content that helps them, rather than content which sells products,” he says.

“Marketing and technology are being joined at the hip and I believe going forward that the chief marketing officer will be controlling a lot of the IT spend and managing the customer facing technology,” Sawhney says.

The future of business technology

It is never an easy call, but how does Sawhney expect business technology to evolve and change into the future?

“The future is a vision of an enterprise that is almost like a sentient being. It is an organism that responds to customers in real time,” he says.

“It is getting signals, ingesting those communications, making decisions, then acting on those decisions all in a closed loop, in real time and in most cases without any human intervention.”

Sawhney says in the future we will have robotic process because humans cannot reach that level of scale.

“The analogy I use is that of the Tesla and autonomous driving where you are free to make higher order decisions such as where is the car supposed to go. The same thing will happen with decision making in the enterprise.

“The combination of automation and analytics will allow you to make decisions in an automated way, leaving the humans to decide strategy and create the compelling customer proposition.”

Turning a complaint into a sale

How an aggrieved Nike customer ended up parting with another US$500 thanks to social media.

“This is a real case. A man who was running a marathon tweets to Nike and says: ‘the sneakers that I had bought for my marathon have not arrived and I’m running the race in three days’,” Sawhney says.

“Nike is able to respond to this individual saying: ‘we have expedited the shipping, we will make sure the stuff gets to you. By the way, it looks like you’re running the Boston marathon, do you know it’s 29 degrees in Boston, it is very cold, are you equipped for the cold weather?’

“The man responds that he didn’t know it was going to be so cold, so the Nike person says they will send through some suggestions for warm gear, such as shirts.

"The man likes what he sees, so Nike expedites the shipping to make sure everything gets to the man in Boston. This started out as a complaint and it ended up as a US$500 sale. We are seeing the return of personalisation on a massive scale.”

Mohanbir Sawhney is appearing at the World Business Forum in Sydney, 31 May-1 June 2017. This article first appeared in the Jun/Jul 2017 issue of Acuity magazine.