27 July 2015
By Paul Fick, Chief
Technology Officer, The Jasco Group
In a world where
products and services have become increasingly commoditised, organisations are
faced with the challenge of finding a competitive edge to gain and maintain
market share. They must find a way of differentiating themselves by delivering
relevant products and services that meet the needs of a constantly evolving
market. Forward-thinking companies understand that innovation is at the heart
of differentiation, driven by a rapidly changing business world and evolving
technology. The CTO is at the heart of this revolution, tasked with positioning
the organisation to maintain profitability by driving uniqueness and
differentiation. Promoting innovation from an executive level, and creating a
culture that supports and rewards innovation, is critical to future
profitability and success.
One of the greatest
challenges facing organisations today is the fact that consumers can now source
whatever they need very easily online, from anywhere in the world. Distance,
geography and the proximity of a bricks and mortar building are no longer differentiators.
In the technology game in particular, as everything has become ‘plug and play’,
obtaining equipment has become highly commoditised. Today, the majority of IT equipment
and solutions, from desktop and portable computers to servers to software, no
longer require high levels of expert knowledge to implement. This makes
differentiation at an organisational level all but impossible, as consumers are
no longer willing to pay for knowledge at a base IT solution level. In order to
counter this, organisations need to develop offerings that are unique,
different, and even mysterious, to capture the attention of the market. It is
necessary to look for opportunity in new, non-traditional places, and to develop
a completely flexible and agile approach. Given the pace of technological
change, it is a guarantee that in a few years the IT landscape will look
completely different, and organisations still peddling the same products will
inevitably fall by the wayside.
So how does a company
involved in IT differentiate and remain relevant? By thinking outside the box –
by innovating. The Chief Technology Officer (CTO) is in an interesting position
in today’s evolving world. While the Chief Information Officer (CIO) is tasked
with providing IT as an enabler for internal services, the CTO needs to think
further, towards how the ICT solutions organisation can position itself in
terms of what they are selling going forward, be this products or services. The
CTO needs to identify what will make the organisation unique, different,
profitable, and this requires a deep understanding of how the market and
technology are changing. The CTO is also tasked with understanding how the
business can think differently, align the overall strategy to this, and embrace
new technological trends without becoming involved in a ‘me too’ scenario.
Doing the same thing as another business, in the same way, with the same
technology, is no longer a sustainable business model.
comes from being cheaper, better or different. Price wars are unsustainable, so
this is an undesirable differentiator for the majority of businesses. Being the
best is one option, however, just being different is often a more achievable
goal. This often means offering some type of niche product yet organisations
need to find the right balance between niche and obscurity. The Internet of
Things (IoT), 3D printing, even drones, offer numerous exciting business
opportunities. Computing is everywhere and continues to become increasingly
pervasive, with analytics, smart machines and intelligence forming a part of
our everyday lives. Communication and IT service and solution providers need to
be able to embrace these trends in such a way as to drive future profits and
gain a reputation for being on the cutting edge. At the same time, innovation
for innovation’s sake will not drive profitability. The key here is relevance
to your market. If South African companies in particular can innovate around
technological advancements successfully, this can then be taken into the wider
African market with some adaptation, which again represents a significant
opportunity for growth and profit.
development (R&D) are an essential component of this. While traditional
research funding and opportunities are limited in South Africa, the Internet
also represents a wealth of knowledge. CTOs can use this resource to research,
understand trends, find ideas or take existing ideas to the next level – all
the cornerstones of innovation. These ideas can then be further developed and
made into something that is relevant and will generate profit. Keeping up with
the latest trends is essential in identifying opportunities for innovation.
While the need for
innovation is well understood, the question remains, who owns the task and
ultimately the responsibility for innovative thinking within an organisation?
For the greatest chance of success, this needs to live at the executive level.
It cannot be delegated, and needs to permeate the culture of the organisation.
This is often a challenge for organisations that are traditionally
operationally driven, as KPIs are all about short and medium term operational /
financial performance. While performance is important, it has become
one-dimensional and often results in flogging products and solutions that
become less and less relevant over time. This is the trap of the ‘me too’ game,
which fosters creating followers and not becoming leaders. To become a leader,
it is essential to drive innovation around all aspects of business, including operational
processes, technology and even service delivery. This all comes back to
understanding current trends and having a deep knowledge of customer needs as
well as anticipation of future requirements.