It’s fine for Microsoft CEO Satya Nadella to say, “Every company is now a software company.” You’d expect someone in his position to live and breathe algorithms.
But when you’re running a small or medium-sized business (SMB), technology can feel more like grime in the gears than fuel powering the machine.
After all, you’ve built up infrastructure, systems, processes, and teams that enable you to serve your customers with the personalized attention the big players just can’t provide. Now, you’re told that’s not enough. Industry 4.0 is coming on strong, and you must get ready to meet it, whether or not you want to.
Yes, you know you could become more efficient. And you understand the pressure to keep up with industry trends and customer expectations. But the thought of making your IT department the center of what you do feels off-kilter. Technology may be king in today’s world, but you’re not ready for it to define who you are as an organization.
Nor should you be.
The smartest way to modernize your SMB isn’t to worship at the shrine of technology. The key to preparing for the future is to keep doing what you do so well while simply enhancing that activity through digital improvements.
Becoming what Nadella calls “a software company” doesn’t mean surrendering your company DNA. In contrast, it means preserving the core of your business by surrounding it with layers of technology that enable and support it.
The fifth pillar
Your business rests on a foundation of five pillars, five functional areas that define who you are and how you serve your customers. The first four pillars form the solid basis of your organization:
- Internal operations
- Products and services
To borrow a concept from Peter Senge, you’ve already developed organizational “disciplines” that support success in each of these areas. But, to pun on Senge’s work, if you want to thrive in today’s business environment, then you also need a fifth pillar, technology, and the disciplines to accompany it.
As the fifth pillar, technology doesn’t loom any larger or more important than the other four, each of which plays a critical role in your company’s success. Technology complements all the other pillars, providing new ways to understand how they work, improve their individual performance, and set them up for future prosperity.
Take the five-pillar tour
As you consider ways that technology (hardware as well as software) could benefit your business, examine each of the five pillars that make up your organization. You may be surprised to discover the potential you see. Each pillar affords opportunities to introduce digital solutions that can improve efficiency, lower costs, and sharpen your competitive edge.
Here are some examples of how you might use digital solutions to modernize your business from top to bottom:
- Internal operations—Start measuring what really matters. As you already know, you can’t improve something until you start measuring it. But how do you know you’re capturing and scrutinizing the right metrics.
Digital solutions enable you to map production and back-office processes in detail so you can spot bottlenecks, redundancies, and waste. Focusing on this pillar is a great way to reap some quick wins in immediate cost savings.
- Customers—Identify creative ways to enhance the customer experience and deliver greater value, increasing your competitive edge (and perhaps your prices too). Digital solutions can provide an end-to-end map of the customer journey, give you new ways to access customer insights, and enable you to engage with your customer base more intimately.
- Products and services—Discover and create new opportunities to generate revenue and revamp your business model. Digital solutions give you access to types and amounts of data you couldn’t have imagined 10, or even five, years ago. And they make it easy for you to analyze, visualize, and act on that data. Make decisions about the future with the confidence of knowing you’re acting on a solid basis of evidence, not just a hunch.
- Employees—Develop a future-oriented mindset that embraces change. It’s no good upgrading your equipment and processes if you don’t also develop in your team attitudes and skills that foster innovation and growth. Digital solutions can offer you training solutions, new modes of communication, and new tools for collaborating.
- Technology—As the fifth pillar, technology helps make change across all the other pillars. It doesn’t need to be brand-flashy new to make an impact. you look closely, you may notice places in your business where you could do a better job of exploiting the capabilities of the software and hardware you already own. Or you may want to invest in the emerging technologies that are ushering in a new era of business, such as robotics, augmented reality, and edge computing.
First steps to embracing “digital”
No one knows for sure just when Industry 4.0 will fully arrive in all its AI-enabled glory. Nor can anyone truly predict how your business will need to adapt and grow in order to meet the challenges ahead.
But it’s safe to say that embracing “digital” is your surest bet for building on your existing strengths and developing resilience across all areas of your organization. You don’t have to fall in love with technology, or the notion of becoming a “software company,” in order to take steps now to ensure your company’s long-term health.
Nor do you have to take those steps alone. Digital solution providers (DSPs) can serve as helpful advisors, mentors, and guides as you navigate your way to the digital future. The right DSP will take the time to thoroughly understand your business, your values, and your team so as to introduce technology without interrupting your daily operations. They’ll also provide ongoing support as you go through the inevitable hiccups that come with making forward-looking change on an organizational scale.
Ready to learn more about digital transformation? Download our free Beginner’s Guide to Digital Transformation.