Business is going to change more in the next 10 years than it has in the last 50. If the 1980s were about quality and the 1990s were about reengineering, then the 2000s will be about velocity. About how quickly the nature of business will change. About how quickly business itself will be transacted. About how information access will alter the lifestyle of consumers and their expectations of business. Quality improvements and business process improvements will occur far faster. When the increase in velocity of business is great enough, the very nature of business changes. A manufacturer or retailer that responds to changes in sales in hours instead of weeks is no longer at heart a product company but a service company that has a product offering.
These changes will occur because of a disarmingly simple idea: the flow of digital information. We've been in the Information Age for about 30 years, but because most of the information moving among businesses has remained in paper form, the process of buyers finding sellers remains unchanged. Most companies are using digital tools to monitor their basic operations: to run their productions systems, to generate customer invoices, to handle their accounting, to do their tax work. But these uses just automate old processes.
Very few companies are using digital technology for new processes that radically improve how they function, that give them the full benefit of all their employees' capabilities, and that give them the speed of response they will need to compete in the emerging high-speed business world. Though at heart most business problems are information problems, almost no one is using information well.
Too many senior managers seem to take the absence of timely information as a given. People have lived for so long without information at their fingertips that they don't realize what they're missing. I want CEOs to demand a flow of information that would give them quick, tangible knowledge about what is really happening with their customers.
Even companies that have made significant investments in information technology are not getting the results they could be. What's interesting is the gap isn't the result of a lack of technology spending. In fact, most companies have invested in the basic building blocks: PCs for productivity applications, networks and e-mail for communications, basic business applications. The typical company has made 80 percent of the investment in the technology that can give it a healthy flow of information, yet is typically getting only 20 percent of the possible benefits. The gap between what companies spend and what they're getting stems from not understanding what is possible and not seeing the potential in using technology to move the right information quickly to everyone in the company.
The successful companies of the next decade will be the ones that use digital tools to reinvent the way they work. These companies will make decisions quickly, act efficiently and directly touch their customers in positive ways. Going digital will put you on the leading edge of a shock wave of change. A digital nervous system will let you do business at the speed of thought-the key to success in the 21st century.
Excerpted from Business @ The Speed Of Thought: Using a Digital Nervous System (Warner Books).