A Kodak moment is coming for organisations that don’t get Big Data

You’d be forgiven for thinking that the data hype is over.  In 2011, McKinsey & Company published a report called Big data: The next frontier for innovation, competition and productivity which forewarned of Big data taking over the world.

Six years later and does it feel like data has taken over the world? Well, I think it depends on where in the world you are.

Those companies and organisations that were early adopters probably think so. Everywhere you look, data is being exploited by smart startups to disrupt traditional businesses. Except that I’m not sure many people outside of the early adopters think that it’s the exploitation of data that’s doing the disruption.

And this leads to big issues. When CEOs and leaders think that Netflix, Uber, Airbnb are just Apps and not data, it’s easy for those people to think that they need an app to compete. They’re wrong.

Most organisations are sitting on mountains of data (or have the ability to get it) that they’re simply not exploiting because they don’t realise that this is what the sharks are feeding on. They will be eaten up in short time if they don’t start collecting/using it soon.

I was recently at a conference where over one hundred of the finest minds in data, in business and organisations, gathered together to discuss and share their experiences within their own organisations.

 

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Corinium CAO Europe conference

 

The people at the conference were at various stages in their organisation adopting a data-centric business model. The huge theme that came out of it as a blocker to anyone talking about why things weren’t happening or why things did happen was senior stakeholder support.

Unless support for data-centricity (not just data projects) comes from the very top, organisations will struggle to do anything but pay lip service. They are ripe for being gobbled up by younger ‘apps’ who get it. Maybe not today, maybe not tomorrow, but soon.

The big danger here isn’t individual businesses and organisations failing. Plenty of companies have failed to grasp the significance of emerging technologies in the past (Blockbuster, Kodak being the famous ones) and the world hasn’t collapsed.

What’s different here is that when multiple organisations fail in the new world, there’s usually just one or two huge winners who snap up the consumers due to the relative ease and speed they can spread without traditional advertising, building and staff.

This is bad for business, competition and ultimately the consumer, no matter how friendly and do-no-evil the newcomers seem.

The impression that I got from the conference is that everyone, even in large organisations who ‘get it’, are struggling. Linkedin failed to realise the significance of its own data until someone fought for a small ‘people you may know’ section on the homepage that made return visits go through the roof. And Linkedin is an example where they already have the hard work of the data done.

Linkedin failed to realise the significance of its own data until someone fought for a small ‘people you may know’ section on the homepage that made return visits go through the roof. And Linkedin is an example where they already have the hard work of the data done.

And Linkedin is an example where they already have the hard work of the data done. The governance, the skills, the technology were all in place, they just hadn’t productised it. A vast number of incumbents haven’t sorted out the hard bits because they don’t even believe that they need to.

So it was five years since McKinsey wrote that report. Perhaps it was a little early but actually, I don’t think so. We can already see the impact around us if we think of disruptors as being data centric rather than just apps, and incumbents as not.

Just as Kodak thought that the digital camera was about technology rather than photographs.

Kodak is back! (well worth watching the clip below)

 

 

Eat all the pies: A digital growth strategy

Below, I divide growth strategies (strategies to grow an organisations online presence) into four types.

1. Bigger slice  

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Satisfying existing visitors.

You have 100 visitors to your online offerings. One of these visitors is a customer, doing the thing(s) that give value to the business (assuming that your business isn’t just to get visitors).

It’s reasonable when thinking about how to grow, to start with what you have and try to get two customers. It feels reasonable anyway. Just as reasonable as Kodak making better/cheaper film to compete with the digital camera revolution.

Pro – You now have two customers for really little investment.

Con – You’ve reached your ceiling and are stagnating

2. Bigger pie  

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Creating new customers.

Now we’re talking. What’s everyone else doing now? How can we get a piece of that (through takeovers, partnerships, entering new markets)? You take your 100 visitors (and one customer) and try to increase that by, say 100. So now you have 200 visitors and two customers. Cool.

It’s surprising how many organisations don’t get to this stage. Often the barrier is that they’re doing too well. Or feel that they’re unique in some way, shielded from the digital disruption that’s happening to them.

To those that do, content strategy and platform innovation come are the tools. Let’s shift our content focus, capture these personas, give them what they want.

Pro – You have two customers (for a little more investment)

Cons – You have reached your ceiling and are stagnating

3. Future pie 

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Shaping what customers will want in the future.

So you have your 100 visitors (and one customer) and you completely ignore them. You disregard everything they’re doing on your site/your competitor’s sites and rip up the rule book of how to go about meeting their needs.

In five years time, you have 1,000,000 visitors and they’re all customers because, well, they are now in some way.

Or maybe not. Because Your CEO looked at the innovation in year two and didn’t like it or, did like it but didn’t think her customers would. Well, of course, they wouldn’t. The customers don’t exist yet. Still, the project got binned and the lead walked from the organisation in frustration and founded a start-up and took all your customers in ten years.

Pro – You have 1,000,000 customers

Con – You don’t. Because the project got canceled and you lost all your customers in the meantime.

4. All the pies 

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The only way to grow/exist in the long term is to look at being a bit of all three of the above. Serve your existing visitors better whilst looking for new ones with an eye (and the boldness) to look at the future.

This requires the most effort and the biggest culture change within an organisation. The majority within are probably using the ostrich pie strategy – sticking their head in the sand and saying their customers won’t want to change. And there’s plenty of evidence every day to confirm that bias. They haven’t changed yet. But then eventually the they become smaller and smaller. And it’s too late. And you’re dead.