Mumbai: Digital innovation is happening outside the boundaries of traditional companies. Though it is clear that digital is the future, the key question is why traditional companies cannot take advantage of it, said Sri Rajan, chairman, Bain and Co. India, during his keynote address at the Mint Digitalist Forum 2018, organised jointly by Mint and SAP India in Mumbai.

According to Rajan, customer demands are not understood deeply enough by companies and there is a false assumption that customers will continue to interact with them in a “traditional manner" as opposed to the “new digital channels of interaction". He believes that organisations lack clarity in terms of the areas that need new strategies, and there is an absence of organisational engagement and governance when dealing with digital.

Terming digitalisation a “tide" rather than a “wave", which has caused a fundamental and strategic shift in the way businesses are run, Rajan emphasized the importance of having “a different mindset to really deal with the change" that is happening. “Business applications (today) are no different from what one might have thought them to be five years earlier—but the ability to put it all together and to bring it to the company and the market is fundamentally different (for each company)," he said. Technologies such as advanced robotics and 3D Printing, which are gaining mainstream popularity, are causing a paradigm shift in the way business is done. “For example, automakers will be able to use 3D printing in the spares and services business instead of having a large inventory. This will also change the supply chain business," said Rajan.

One of the big challenges in our age, according to him, is automation. “About 57% of jobs are at the risk of automation, while 65% of today’s children will work in new job types that don’t yet exist. About 85% of customer engagement will be managed without human interaction and 90% of employers anticipate more competition for talent," Rajan said, highlighting some of the findings of a digital survey done by Bain & Co.

On the question of what should be done to fully take advantage of digital, Rajan urged companies to gain a deep understanding of customers, in addition to “charting a critical path to a pre-determined destination, balancing the business strategy and vision with efficient execution, procuring the right data stack and infrastructure, and preparing the entire organization to be digital-ready".

Rajan also suggested making meaningful investments to make the corporate architecture “more flexible" because a lot of companies still assume that the legacy infrastructure they have in place will help them innovate.

“Start off with some ad hoc investments and then embed digital into everything, but keep in mind that it’s not an easy path to success, whether it is in terms of technology, the data stack, customer experiences or data privacy," he said. He also advised companies to learn from their mistakes and continue to build on them.

“Think big, use data analytics to build a holistic view of the customer, transform experiences with the right technology, forge partnerships with start-ups in your industry to keep abreast of innovations, and have a strategy in place and ensure the entire organisation is attuned to it," Rajan added.

He also exhorted companies to deeply understand the importance of cybersecurity, in addition to gathering more data to analyse individuals in their organizations through more “unique lenses", apart from traditional factors such as education and work experience.

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