SMAC: Enabling Business Paradigms of the 21st Century

Alok Ranjan
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Alok Ranjan

Alok Ranjan is a marketing specialist and management consultant based in Mumbai, India. He believes, brands are caught in a maze of technology and economic dynamics, caused by disruptive forces, which are changing the way consumers interact with brands. He blogs at
Alok Ranjan
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Latest posts by Alok Ranjan (see all)

If you stand still, you fall behind.
Mark Twain

Agility, adaptability, and innovation are lifeline for success of enterprises in the 21st century. From having shutters down at the ‘Kodak Moment’ for the 130-year-old George Eastman’s Kodak to closing the curtains on many traditional business paradigms belabor that enterprises of the 21st century need to continually adapt their business models to survive the onslaught propelled by technology. Social, mobility, analytics, and cloud (SMAC) are convergent forces forcing enterprises to innovate and be agile and creative to survive in the race for existence. The rise of disruptive firms has challenged the existence of traditional businesses and created economic uncertainty loom over conventional business paradigms. Welcome to the digital era, powered by SMAC, where customer engagement and business model adaptations are top priority for enterprises to hold their ground.

The Internet serves as a backbone to disruptive technology firms (firms that challenge the status quo in the technology market and influence their competitors) and these firms are vehemently challenging the hegemony of traditional businesses in the recent past. In 2013, acquired a 100-year-old newspaper Washington Post for $250 million as they lacked innovative and adaptive business model to thrive in the digital era. Numerous innovative products have flooded the market to engage with customers right in their bedroom and are forcing enterprises to either evolve or extinct, in this century. Let us focus on how SMAC is enabling enterprises to challenge traditional behemoths and driving customer value to the last mile.

Enabling New Business Paradigms

The rise of SMAC as a nexus of force has equipped disruptive enterprises to strengthen their technological innovation capabilities. Siemens is busy developing batteries and wind technologies that will increase Germany’s reliance on renewal power in future. Tablets and the smartphone can control, Philips innovative new bulb. Safaricom challenges traditional banking through its widely acclaimed mobile currency M-Pesa in Kenya. Vidyo, a technology firm poses challenge to giants like Cisco with the launch of high-definition video conferencing on smartphone. These use cases establish that social, mobility, analytics and cloud (SMAC) is the new normal and enterprises need to adapt their business models to succeed in this dynamic marketplace. Traditional behemoths have gradually become restless for existence. The tide has shifted from established to innovative firms. Forward-looking enterprises have engulfed traditional businesses and pushed them towards bankruptcy. Some of the leading business models which failed against disruptive firms are:

Blockbuster – Movie rental – Failed against Netflix, YouTube
Kodak – Photography – Failed against Flickr, Smartphone proliferation
Border – Book retailer – Failed against
HVM – Music retailer – Failed against Apple iTunes, Spotify

Enabling Customer engagement models

Customers are at the core of activity on social, mobility, analytics and cloud (SMAC). Disruptive firms center their business strategies around user activity on social media sites, mobility, analysis of the collated information through advanced analytical tools like Hadoop, NoSQL and Splunk etc. Just off the pan, acquisition of our time where Facebook acquired another disruptive technology firm Whatsapp for $19 billion is driven to get hold of 450 million users of Whatsapp. It is worth to note that every day Whatsapp registers more than 1 million users globally and will hit a billion in a year. An enterprise does not need anything more than just monetize the registration for a few dollars to keep this business model profitable. Firms like Facebook, Amazon, and Google are pioneers that have recognized every opportunity to reach their customers through multiple avenues.

Social – In less than a decade social networking sites have made significant impact on the marketing needs of traditional enterprises. Constant flow of information through likes, follow, post, video, check-ins, images, etc., have created a web of information to understand the needs of each customer individually. Brands are busy customizing their marketing strategy everyday to satiate the needs of their interconnected consumers. Recently, Virgin America pioneered with the launch of its in-flight social networking app, Here on biz, to be accessed at the height of 35,000 ft. This app works by isolating the geo-location and unique IP of each Virgin America plane in the sky. Guests can connect with their fellow passengers, travelers on other Virgin America flight and guests at their destination airport, via the LinkedIn API. With this, Virgin America’s consumer engagement strategy leapfrog by empowering travelers to experience interconnectedness and initiate discussions. This also transforms the way a business traveler hunt for leads in the near future.

Mobility – The proliferation of enterprise network applications on mobile handsets has removed the barriers between remote and real workstation. According to a survey by CISCO, the number of Bring Your Own Devices (BYOD) devices will exceed 405 million in 6 major economies, including the US, the UK, India, Brazil, China, and Germany. BYOD is also helping improve employee productivity by 81 minutes per week in the US. Realizing the potential of going mobile, Irvine, CA based firm Tacobell is launching a smartphone app to aid their consumers through mobile ordering and payment processing through credit card or gift card. When the user enters a restaurant to pick up the order, the GPS locator notifies the kitchen when to estimate the customer’s arrival. In case the customer finds a long queue at the drive through, Taco bell will have in-store counter for mobile purchases to ease quick order fulfillment. Brands are busy strategizing consumer engagement processes with the help of technological opportunities offered by SMAC in the 21st century.

Analytics – “In their book, Big Data: A Revolution That Will Transform How We Live, Work, And Think, authors Viktor Mayer-Schonberger and Kenneth Cukier explain that the digital deluge on the globe is the tantamount to giving every human being on Earth 320 times as much information as is estimated to be stored in the Library of Alexandria (in the 3rd century B.C. Ptolemy II of Egypt is believed to store every written transcripts existing on earth.)” The proliferation of data is the beginning of a major economic transformation in the 21st century. Enterprises analyze the data from all sources, including social, mobile, and offline to understand their consumer behavior and targets them with a specific offering. Big data are helping enterprises to understand the relation between available pieces of information, which were beyond our comprehensive earlier. Leading online firms like Amazon, Netflix, Pandora and (online dating site) use analytics to recommend products, and services as per customer preferences.

Cloud – Cloud computing provides the scalability and agility to future proof enterprise business transactions. It provides startups and SMEs an advantage to compete against traditional enterprises. IDC predicts that public cloud services revenue will grow by 27% year-on –year until 2016 while private cloud services revenue will grow at 50% year-on-year until 2016. Internet giants such as Google, Facebook, and Amazon claim the success of their business models over the cloud. The cloud provides an opportunity for disruptive startups like KickstarterCoursera to go global and compete against business giants. At the core of SMAC, cloud helps enterprises engage with their consumers in their bedroom. Netflix and YouTube video streaming services are successful enterprises operating in a cloud as part of their business model. It is worth to note that Netflix and pushed movie rental service provider Blockbuster and a large format retailer WestWild in Germany out of business.

Social, mobility, analytics and cloud (SMAC) has transformed the business model of many leading enterprises and is continually driving innovation for the global good. Let me know your thoughts on how SMAC will transform enterprise business models and drive consumer engagement in the near future.

Digital Darwinism: Adapting for the Enterprise Success

Alok Ranjan
Follow me

Alok Ranjan

Alok Ranjan is a marketing specialist and management consultant based in Mumbai, India. He believes, brands are caught in a maze of technology and economic dynamics, caused by disruptive forces, which are changing the way consumers interact with brands. He blogs at
Alok Ranjan
Follow me

Latest posts by Alok Ranjan (see all)

“It is not the strongest or the most intelligent who will survive but those who can best manage change.”
– Charles Darwin

Technology disruption has ushered in a period of ‘Digital Darwinism’. An era where the evolution of technology and society is faster than the ability of enterprises to adapt. The tectonic shift in enterprise business dynamics towards adapting their business models, the democratization of technology leading to the rise in number of connected consumers, and the transformation of enterprises to digital are a manifestation of ‘Digital Darwinism.’ Enterprises involved in adapting business models, enhancing customer experiences and improving operational efficiencies are bound to succeed against the digital onslaught, which already has led to the crumbling of large enterprises, including, Kodak, Borders, HMV, and Blockbuster, etc.

In a research conducted by Nielsen in 2014, in the US, close to 85% of the online consumers refer expert content and product reviews online before making a purchase. More than 36% of the in-store purchases are influenced by digital interactions, states a report by Deloitte. Enterprises are busy creating multiple touch points to remain on the top of the mind of their consumers. Adopting digital technologies with a stated vision is the key to survival in these times when consumers occupy a driver’s seat. It is interesting to note that only 71 firms still exist from the original 1955 Fortune 500 list, while the others could not survive the technological revolution. Traditional enterprises, over a period, have failed to evolve their business models and perish while the technological impact on business kept increasing. Let us understand the impact of “Digital Darwinism” on enterprises as it happens.

Adapting Business Models

The Indian coupon deal site Snapdeal, which started as an Indian counterpart of Groupon, adapted its business model to emerge as a successful online retail store, in less than a decade. The dramatic shift is accounted for the survival strategy of Snapdeal in the recent times. Changing customer experiences, rise in internet connectivity and pervasive effect of mobile technology on consumers guided the firm to quickly adapt its business model to keep the business afloat. The fall of Research in Motion (RIM), the maker of Blackberry phones, is a perfect example of how lack of technological innovation and misalignment of business model has negatively impacted the firm.

Enhancing Customer Experiences

To augment its brand positioning, Audi, the German automaker launched in-store digital experience through Audi City. The City allows consumers to experience full model line up within the store digitally, allowing a greater brand interaction with the machine and creating a mesmerizing purchase experience for its customers. Enterprises are busy providing tailored experience coupled with developing an emotional connect with their consumers using digital tools. With customer at the center stage, enterprise digital transformation strategy is evolving towards easing the lives of their consumers.

Improving Operational Efficiencies

Commonwealth Bank of Australia launched an app., which allows customers to view residential property details by just pointing their smartphone camera towards the house. The app also provides details on the equated monthly installments for CBA loans, thereby automating processes and increasing operational efficiency of the bank. Enterprises adding technological innovation at every step of the value chain are able to address the needs of their digitally connected consumers and find themselves on the cusp of digital transformation.

Gearing up for the Digital Action

Enterprises wary of digital technology may cease to exist in the next few years and are required to holistically upgrade their strategy for competitive advantage. They need to upgrade their technology, people, operational processes and business models to include digital. As Brian Solis in his book “What’s the Future? Of Business ” states “ The future of business is not about technology, greed or short-term deals. It is about people, purposes and experiences. It takes vision. It takes empathy. It takes courage. The future of business lies in the shift from a culture of management to that of leadership. It begins with you..”

In order to gain strategic advantage over their competitors, forward looking enterprises requires to proceed with the following initiatives:

Define a clear vision for digital transformation: Enterprise leadership needs to define the roadmap for the transformation. The strategic vision should address: the demands of the connected consumers, a brand-connect strategy and optimization of business processes for a successful digital transformation. Emphasis should be on the optimal use of digital technology across the value chain to streamline processes per the industry standards.

Seek organization support for implementation: The success of digital transformation depends on eliminating enterprise silos across departments and software applications. A flexible and innovative culture can help enterprise teams to propagate the strategic vision to a wider audience both within and outside the organization. The need is to focus the team towards customer centricity, which can help organizations overcome the initial challenges during the transformation process.

The transformation process maturity: Digital is still in its infancy. Technological advancements will consistently shape the digital transformation processes. As digital technologies mature, the strategic vision should incorporate changes to address new business needs. Leadership teams will require to seek active participation of their organizational teams, as the technology matures.

The Future Beholds

The digital onslaught experienced by enterprises in the 21st century is the beginning of a new age industrial revolution, which will lay the foundation of the disruptive firms. With customer experience influencing an enterprise business strategy in a big way, leadership team must pass the digital baton to a larger team for proper dissemination of the strategic vision. Successful enterprises are constantly innovating, developing and renewing their products and services in tandem with the customers demand. At a time, when traditional businesses are no longer relevant to keep their customers loyal, digital has created opportunities for enterprises to adopt, adapt and survive the Digital Darwinism, over a period.

Image credit: Pixabay

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