“Any attempts of predicting the year go against the business and IT laws of 2014. What we know for a fact is that 2014 is all about unpredictability. What does this mean for you?”
2014 is going to be an interesting year in many ways. The force of digitalization is continuing to increase in strength and further challenging the business and IT environment. Customers want, to a greater extent, interact anywhere and at any time with business and IT in easy ways challenging old laws of marketing, IT capabilities and governance structures. What will be the disruptive trends for 2014? What industry will suffer the impact of digitalization this year falling into a digital black hole? Which companies will be successful and which companies will disappear? It is going to be an exciting year! Are you prepared?
Blog posts and magazines are packed with experts predicting the key trends of 2014. McKinsey and Gartner (and others) are predicting key IT trends of the year. But the attempts of predicting the year go against the business and IT laws of 2014. What we know for a fact is that 2014 is all about unpredictability. Attempts to predict the future leaves business and IT managers in false security, as, in many industries, the level of predictability is limited to 6-9 months (decreasing) leaving a major part of 2014 in the shadows. We frankly do not know the conditions for business success after summer 2014. That is how fast the business and IT evolution is running. Still we make plans and strategies for 2-3 years (sometimes even longer) with absolute no relevance based on expert predictions.
The key question for 2014 is not trying to predict trends but rather how to be successful in an unpredictable environment. What happens if the level of predictability decreases to three months (very likely scenario in the digital economy)? It is important to understand that digitalization and unpredictability is challenging organization’s governance, values and innovation capabilities – and that is what 2014 is all about. Leveraging knowledge to quickly adjust to new business and IT challenges.
I will not make any trend predictions for 2014, as it is an impossible task in an unpredictable environment creating false security. Rather a number of recommendations on how to be successful in the digitalization landscape with high unpredictability. The starting point is to have the right expectations for the year to ask the right questions:
- Expect total unpredictability (zero months visibility) and base governance structure on this assumption. What does this mean for your IT organization?
- Expect business to demand interaction with IT anywhere, anyhow and anytime in a seamless and smooth way. What does this mean for you?
- Expect to continue to reduce IT cost levels and increase business value of IT supporting business success. What does this mean for you?
It is clear that a traditional governance models do not work 2014. Over 75% of managers (business and IT) worldwide state that their processes (planning, budgeting and traditional performance management) can neither cope with unpredictable change nor add business value (www.bbrt.org). Traditional governance models are actually the key factor jeopardizing cost efficiency and business survival. It is time to make a difference!
The successful companies in digital and unpredictable environments have adopted new governance structures based on agility, self-governance and trust. It is an approach aligned with Customer Intimacy strategy resulting in higher cost efficiency, business and customer value, higher RoE and innovation capabilities. The competitive advantage of these companies are not the products or services they provide but rather their ability to adapt to new trends in a speedy and efficient way. They own their own analysis and have a culture and leadership based on trust. The solutions are there, if we look beyond outsourcings, large ERP projects, and costly lean projects. It is up to you to decide if 2014 is going to be a great year (agile performance management) or another step closer to the digital black hole (traditional governance).
The Goodwind Company is an agile consultant firm focusing on agile performance management and governance models. Proven frameworks to re-shape IT organizations to address the new digital and unpredictable landscape. Give me a call when you decided how to be successful in 2014!