Eram quod es, eris quod sum (I was what you are, you’ll be what I am)
Managing towards a digitalized company, towards digitalization or Digital Transformation is a challenge comparable in size to its tremendous potential. Few companies can afford to escape from this challenge, which predicts a major disruption in the competitive context where corporations have been developing to date. New competitors, from alien, culturally digital industries, will often render useless the efforts to develop barriers to entry, because of the ease with which those will be saved.
Adapting to this new environment will require business models that are both agile, changing, and sustainable in time. Companies will need to rethink not only their value proposition, but also what they want to be, and what space they want to occupy. Most of these companies, whose spaces and borders have been blurred, are now looking down on new competitors as ‘barbarians approaching on the other side of the gate’.
There was a time, the industrial age, when the only valid law in production activities was the law of diminishing marginal returns; the more units of a certain good were produced, the lower was their market value per unit.
Today, this law has expired, or is in the process of doing it, precisely because of the transversal and systemic impact of technology, applied both to processes and market interactions. With more units produced, a higher value per unit is obtained. The more distributed, the higher are the marginal growth and the value of each unit deployed. Welcome to a world dominated by positive network effects. Facebook, eBay are businesses where every new user added, increases the value for the entire community.
How to face and manage this process?