Welcome!

@DXWorldExpo Authors: Elizabeth White, Zakia Bouachraoui, Liz McMillan, Pat Romanski, Carmen Gonzalez

Related Topics: @ThingsExpo, @CloudExpo, @DXWorldExpo

@ThingsExpo: Blog Post

Digital Transformation and the Ignorance Penalty | @ThingsExpo #IoT #BigData #DigitalTransformation

Businesses will be required to pay, one way or another.

During the Cold War the armies of East and West faced off along thousands of miles of borders with tens of thousands of tanks, artillery units, defensive positions, guns and soldiers. The costs for supporting these defensive postures were enormous. Nations invested hundreds of billions of dollars over the years maintaining these positions, not to counter an immediate known threat, but to prevent an unknown future threat.  In other words, they were investing in mass weapons, mass equipment, mass training and mass supplies to prevent an unknown threat, at an unknown location, at an unknown time.  They were investing to combat ignorance - a lack of knowledge.  They spent massive amounts defending against the unknown - everywhere.  That spending was the same as an ignorance penalty.  A penalty, so huge, it negatively impacted the economic futures of many countries.

Businesses that operate in the dark, and have not digitally transformed, are also paying an ignorance penalty today.  The ignorance penalty is the cumulative effect of conducting business without digitally derived data providing precise insights and knowledge, and without the ability to act instantly from afar. In markets where all competitors are equally paying the ignorance penalty, competition is not impacted.  However, when a few companies decide to digitally transform to reduce their ignorance penalty, then competitive markets are very much disrupted.

When some competitors are stuck paying a very expensive ignorance penalty, and others aren't, a competitive gap quickly opens.  We see this in the form of Amazon and other digitally transformed retailers precisely marketing personalized products to individuals, while traditional stores spend massive amounts marketing generic products to regions filled with unknown customers.

The ignorance penalty rate is high enough that it will bankrupt many companies required to pay it.  In my current research, I am seeing data that suggests laggard companies (those slow to digitally transform) believe they can afford to pay the ignorance penalty for a few years while slowly preparing to digitally transform in the future without suffering unduly.  This, however, is what we call digital delusion.

In March 2016, Sports Authority filed for bankruptcy.  Analysts reported it was due in large part to their slow response to online and mobile commerce competition. The ignorance penalty bankrupted them.

In May 2016, Aeropostale filed for bankruptcy.  Analyst reported they were unable to keep up with the speed of their more digitally transformed competitors, fast-changing fashion trends and changing consumer behaviors. The ignorance penalty bankrupted them.

British Home Stores (BHS), a centuries old chain of stores across the UK, also filed for Administration (UK's version of bankruptcy) this spring. Analysts reported they were "very slow to embrace digital transformation, and their products were no longer relevant."  The ignorance penalty bankrupted them.

The need to stay competitive by digitally transforming does not wait for your budget cycle, 5-year plan or alternative strategic priorities.  Digitally transformed competitors don't wait for you to catch up.  Digitally transformed competitors are rapidly propelled forward by new digital insights and knowledge integrated with agile business systems capable of responding to the new information in real-time.

Businesses have a choice to pay the ignorance penalty, or use the money today to invest in digital transformation - either way, it will be payed.

Follow Kevin Benedict on Twitter @krbenedict

More Stories By Kevin Benedict

Kevin Benedict serves as the Senior Vice President, Solutions Strategy, at Regalix, a Silicon Valley based company, focused on bringing the best strategies, digital technologies, processes and people together to deliver improved customer experiences, journeys and success through the combination of intelligent solutions, analytics, automation and services. He is a popular writer, speaker and futurist, and in the past 8 years he has taught workshops for large enterprises and government agencies in 18 different countries. He has over 32 years of experience working with strategic enterprise IT solutions and business processes, and he is also a veteran executive working with both solution and services companies. He has written dozens of technology and strategy reports, over a thousand articles, interviewed hundreds of technology experts, and produced videos on the future of digital technologies and their impact on industries.

DXWorldEXPO Digital Transformation Stories
The platform combines the strengths of Singtel's extensive, intelligent network capabilities with Microsoft's cloud expertise to create a unique solution that sets new standards for IoT applications," said Mr Diomedes Kastanis, Head of IoT at Singtel. "Our solution provides speed, transparency and flexibility, paving the way for a more pervasive use of IoT to accelerate enterprises' digitalisation efforts. AI-powered intelligent connectivity over Microsoft Azure will be the fastest connected pat...
There are many examples of disruption in consumer space – Uber disrupting the cab industry, Airbnb disrupting the hospitality industry and so on; but have you wondered who is disrupting support and operations? AISERA helps make businesses and customers successful by offering consumer-like user experience for support and operations. We have built the world’s first AI-driven IT / HR / Cloud / Customer Support and Operations solution.
Codete accelerates their clients growth through technological expertise and experience. Codite team works with organizations to meet the challenges that digitalization presents. Their clients include digital start-ups as well as established enterprises in the IT industry. To stay competitive in a highly innovative IT industry, strong R&D departments and bold spin-off initiatives is a must. Codete Data Science and Software Architects teams help corporate clients to stay up to date with the mod...
At CloudEXPO Silicon Valley, June 24-26, 2019, Digital Transformation (DX) is a major focus with expanded DevOpsSUMMIT and FinTechEXPO programs within the DXWorldEXPO agenda. Successful transformation requires a laser focus on being data-driven and on using all the tools available that enable transformation if they plan to survive over the long term. A total of 88% of Fortune 500 companies from a generation ago are now out of business. Only 12% still survive. Similar percentages are found throug...
In his general session at 21st Cloud Expo, Greg Dumas, Calligo’s Vice President and G.M. of US operations, discussed the new Global Data Protection Regulation and how Calligo can help business stay compliant in digitally globalized world. Greg Dumas is Calligo's Vice President and G.M. of US operations. Calligo is an established service provider that provides an innovative platform for trusted cloud solutions. Calligo’s customers are typically most concerned about GDPR compliance, application p...
Druva is the global leader in Cloud Data Protection and Management, delivering the industry's first data management-as-a-service solution that aggregates data from endpoints, servers and cloud applications and leverages the public cloud to offer a single pane of glass to enable data protection, governance and intelligence-dramatically increasing the availability and visibility of business critical information, while reducing the risk, cost and complexity of managing and protecting it. Druva's...
BMC has unmatched experience in IT management, supporting 92 of the Forbes Global 100, and earning recognition as an ITSM Gartner Magic Quadrant Leader for five years running. Our solutions offer speed, agility, and efficiency to tackle business challenges in the areas of service management, automation, operations, and the mainframe.
With 10 simultaneous tracks, keynotes, general sessions and targeted breakout classes, @CloudEXPO and DXWorldEXPO are two of the most important technology events of the year. Since its launch over eight years ago, @CloudEXPO and DXWorldEXPO have presented a rock star faculty as well as showcased hundreds of sponsors and exhibitors! In this blog post, we provide 7 tips on how, as part of our world-class faculty, you can deliver one of the most popular sessions at our events. But before reading...
DSR is a supplier of project management, consultancy services and IT solutions that increase effectiveness of a company's operations in the production sector. The company combines in-depth knowledge of international companies with expert knowledge utilising IT tools that support manufacturing and distribution processes. DSR ensures optimization and integration of internal processes which is necessary for companies to grow rapidly. The rapid growth is possible thanks, to specialized services an...
At CloudEXPO Silicon Valley, June 24-26, 2019, Digital Transformation (DX) is a major focus with expanded DevOpsSUMMIT and FinTechEXPO programs within the DXWorldEXPO agenda. Successful transformation requires a laser focus on being data-driven and on using all the tools available that enable transformation if they plan to survive over the long term. A total of 88% of Fortune 500 companies from a generation ago are now out of business. Only 12% still survive. Similar percentages are found throug...