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As companies digitize products and process, completely new ways of doing business in industries emerge, according to a report from IT research firm Gartner.
The firm’s analysts expect more transformational changes as digital reinvents industries on the second level–the business model level, and as digital business applies unprecedented combinations of new technologies to generate revenue and value, it’s imperative that CIOs step up and lead in the digital world.
“In the digital future, a human can talk to a ‘thing’ such as requesting a driverless taxi, just as easily as a ‘thing’ such as a building can contact a human maintenance worker because the building predicts that a surge in foot traffic means the garbage cans must be emptied soon,” Hung LeHong, research vice president and Gartner Fellow, said in a statement.
In the digital future, the Internet of Things–the network of physical objects that contain embedded technology to communicate and interact with their internal states or the external environment–will become as active as humans and systems are on the Internet today.
“Digital technology is improving our products, services and processes, our customer and constituent experiences, and the way we work in our enterprises and within our partner,” LeHong said. “We do what we normally do, but digitalization allows us to do it better or develop better products.”
The report highlighted Square, Bitcoin and Kickstarter as three examples of companies that have used digital to reframe the way old financial institutions and venture capitalists work. Technology will enable all companies to optimize business processes, create new business models and identify and exploit those business moments, the report said.
Gartner analysts said 3D printing meshes with business principals of the digital world, and it will revolutionize industries as diverse as fashion, retail, real estate and the military, while smart objects could be as simple as a sensor that tells someone when their plants need water, and at the other end of the spectrum there will be objects as complex as a person’s car.
“It’s the source you mine for new business models and business moments. It’s the raw material from which you construct new products and services. It’s the evidence that enables you to visualize and optimize business processes,” Nick Jones, vice president and distinguished analyst at Gartner, said in a statement. “You won’t have the time or capacity to make all the decisions yourself. Computers can make sophisticated decisions based on data and knowledge, and they can communicate those decisions in our native language. To succeed at the pace of a digital world, you’ll have to allow them to do so.”
Gartner analysts said one of the most important ways for CIOs to think of their job for the next few years is to think of them as “digital storytellers” in their business. In business, the dominant narrative has been the financial story.