business models in digital ecosystems

Question 1

what is disruptive tech?

Answer 1

tech used to fundamentally change the existing business model in an industry. not gradual and leads to sudden osbolescence of traditional business models

Question 2

what are the main disruptive technologies that are relevant to finance?

Answer 2

fintech - disrupting banking sector. fintechs have advantages of: better use of data/understanding of customers, personalisation, lack of overheads, access to cheap capital as investors want to get involved

cryptocurrencies - aim to meet the attributes of a store of value, unit of account and medium of exchange - to be a form of digital money.

blockchain - reduces risk/cost, increases data security and transaction transparency. blockchain means don’t need centralised banks because can directly complete transactions between parties, increases speeds.

Question 3

why is it not true that orgs that aren’t already digital have missed their chance?

Answer 3

businesses who have been around for a long time have substantial assets - know how, customers relationships, brands, distribution channels, data - and should look to leverage these, while simply adapting their business model.

Question 4

what are the three myths of digital disruption?

Answer 4

orgs not already digital have missed their chance

becoming a digital business is an admin task

digital transformation only needs a digital business unit (really, digitisation impacts all employees and transformation needs to be driven by top of org)

Question 5

what are some emerging trends in the digital world?

Answer 5

internet of me - user-centric experiences, personalisation

outcome economy - customers more attracted to outcomes than products

platform revolution - global platforms becoming easier to establish and cheaper to run. rate of evolution ever increasing

intelligent enterprise - smart data use = high operating efficiency

workforce reimagined - greater use made of smart machines, man and machine to work together for better outcomes

Question 6

what three steps should a business take to rethink its model in the face of disruption?

Answer 6

innovate on the periphery - don’t disrupt core business but focus on new produces/services/segments aligned with disruptive trends. try and integrate into the ecosystem by leveraging external resources

hire digital-savvy individuals - hire hacking teams to attack core processes. can defeat and disrupt company before rivals can

copy successful firms - most holistic approach, establish internal accelerating lab to focus on big ideas or fast track partnering programs with accelerators

Question 7

what are two main challengers for innovators in terms of business model?

Answer 7

the model that has served them for decades has been disrupted and no longer works as desired

all attempts to create a new viable business model for the digital age must further disrupt existing business or won’t be successful

Question 8

what approaches does the WEF say companies should adopt to respond to disruption?

Answer 8

build: new models maybe best route when opportunity related to company’s core business. max control, min cost, can create and develop through internal R&D

buy: when strategic imperative to own market. may be needed if right talent not available/new opportunity not very related to current model. ideal when startup gaining traction but not yet mkt leader. achieve synergies.

partner: learn about other models, sensible when wanting to learn about new opportunities with options to acquire in future. partnering expected to play important role in digital transformation of mkt players

invest: allow established company to connect with right skills/capabilities. mitigates risk of failure to integrate when partnering/buying. external startups therefore less constrained by competition with core business.

Incubate: closer relationship to funding company, deploy corporate internal capabilities. outline clear strategy and vision.

Question 9

what are the 5 successful WEF digital operating models? what do they have in common?

Answer 9

customer centric

extra frugal

data powered

skynet

open and liquid

all replace rigid approaches to tech/data/processes with flexibility and encourage open culture to innovation and interaction with customers and partners

Question 10

what is the customer centric digital business model?

Answer 10

make customers lives easier, emphasise front office. works best with client first culture and decentralised structure

Question 11

what is the extra frugal digital business model?

Answer 11

less is more culture, standardised organisational structure. optimise manufacturing/supply/support processes. can provide high-quality service at low cost. e.g. whatsapp - bought by facebook with 450mil users but just 35 engineers

Question 12

what is the data powered digital business model?

Answer 12

built around prowess in analytics and software intelligence. data-powered companies have agile culture focused on innovation through empirical experimentation, e.g. google and netflix

Question 13

what is the skynet digital business model?

Answer 13

makes intensive use of machines to increase productivity and flexibility in production. pioneered by amazon, characterised by engineer-led culture dedicated to automation

Question 14

what is the open and liquid digital business model?

Answer 14

looks outward, create an ecosystem that can enrich customer proposition. built around a sharing customer, all processes in orgs of this kind are characterised by constant flow of dialog with outside world, e.g. facebook

Question 15

what abilities do the C-Suite need to demonstrate to take advantage of a digital move/survive digital disruption?

Answer 15

inspirational leadership - energise, inspire confidence this is right way forward.

competitive edge - get people changing mindsets, adopt inquisitive attitude, invest in training and ensure staff are skilled up.

establish a strategic direction - planning horizons may need shortening/more flexibility, enable rapid responses.

influence external parties - be persuasive and articulate value proposition, as greater uncertainty over outcomes

collaborate - analyse potential ecosystem partners, may have to lobby to enter established ecosystem

business judgement - don’t assume linear supply chain, ecosystem based approach, choose a model that will work

execution - people and tech must work in harmony to produce desired outcomes. execute strategy and manage transformation. consider metrics/benchmarks/BSC use

build talent - identify skills staff will need to demonstrate/to manage training. new roles may be needed

Question 16

what is changing in terms of attracting/retaining talent in the digital world?

Answer 16

greater transparency about employment opportunities for challenge seekers, businesses adopting mindset of ‘we have nothing to hide’, this is producing a more productive workforce with lower staff turnover

competition for digital talent is increasing. orgs taking notice of social media activity, look for referral programs so staff do this online. right incentives = easier to attract good staff

Question 17

what does the world economic forum propose companies should do to become an employer of choice?

Answer 17

• formulate long-term working strategy for millennials - identify relevant positions employees will occupy during their career with the company and create suitable promotional opportunities.
• work with staff to formulate company values - senior mgment should do this in person
• empower the workforce - give them incentives to perform e.g. long-term company share plans, project leadership/training opportunities.
• build workspaces that attract digital talent - flexibility/dynamic appearance in workplace inspire creativity and collaboration. thought should also be given to allowing staff to wfh and introducing flexible working hrs
• create policies that support collaboration and knowledge sharing tools

Question 18

what roles should a CEO fulfil during the digital age?

Answer 18

creator of vision and mission

strategic planner - focus will change, move to shorter planning cycles, greater focus on experimentation rather than long-term planning.

driver of info-based business models

enabler of shift to on-demand operating models

innovation promoter

operational excellence driver - introduce automated processes

Question 19

what factors distinguish a digital culture from others?

Answer 19

having a strong mission statement/clear sense of purpose

creating lean business structures

developing a diverse workforce with good digital skills

Question 20

what key areas can be focussed on to create a digital culture?

Answer 20

• communication
  
  • by digital means should be encouraged. don’t replace one to one conversations, but use all digital channels - social media, forums, webcasts, shared mailboxes etc
• journey management
  
  • creativity needs to be released and training provided so middle managers recognise how to achieve this.
• making changes visible
  
  • visible roadmaps
• continuous change monitoring
  
  • feedback surveys/performance monitoring

Question 21

what questions should be asked to decide if automation can help reskill/reduce a workforce?

Answer 21

1. what is value of automation to the business? low-skilled non-routine work is easy for humans but expensive to automate
2. what extent will automation be core to the business? buying established automation capabilities is much cheaper and quicker than developing in house, only do latter where automation likely to become core competence.
3. does business have skills it needs to develop automation solutions? if not, consider partnering.

there is a social responsibility to retain and re-skill staff that should be considered.

Question 22

what are the two factors to consider in the data accenture model?

Answer 22

data complexity and work complexity

Question 23

what are the 4 models in the accenture model?

Answer 23

efficiency model: routine activities based on stable well defined tasks. easily programmable. scope for high degree of automation

expert model:
structured data based on unique/unpredictable work. work part judgement and dependent on expertise

effectiveness model:
work highly knowledge-based and requires high degree of interpersonal contact. complex data, but routine and predictable.

innovation model:

cognitive tasks concerned with innovation and creativity. highly reliant on expertise, experimentation and exploration.

Question 24

how can companies create an org/structure that premits and accepts temp staff?

Answer 24

online talent platforms avoid recruitment and entry costs, may also be tax savings for org/worker.

critical to advertise for tasks not positions, as a truly on-demand workforce doesn’t fill permanent roles in org. having specific tasks, with key milestones/expectations that on-demand workers need to complete reduces number of processes orgs need to go through in selection.

strike balance between perm and temp staff, too many on-demand can erode corp culture but too many permanent can create barrier to acceptance of on demand.

be conscious of confidentiality, security and legality.