How organizations can plug into the future of tech innovation

For all C-level executives, connecting major strategic themes with the top technology and innovation trends should be paramount.

In the Transformative Age, every business must learn to adapt and reinvent itself — not as a one-off, but continuously. Change and agility must be embedded into operating models, to create and sustain competitive advantage in a world where platform businesses are causing industries to converge.

Technology is driving all of this, and keeping up with the pace of technological change to realize its potential has become a mandatory capability. Businesses, regardless of their industry and how successful they may be in winning in the market, need to be masters of emerging technology and embrace a "dynamic venturing" approach to foster innovation, both internally and across external ecosystems.

Strategic themes

Independent of industry or geography, C-level executives at established, complex organizations are grappling with five strategic themes currently impacting markets and shaping the future of competitive advantage.

• Exponential customer centricity: Exponential customer-centricity is about reorienting the company culture in conjunction with enablement and empowerment through technology platforms.
• Agile ecosystems: Organizations need a new way to foster scale across ecosystems of collaborating partners, including ones they might collaborate with in one market segment but compete with in another.
• Platform business: For successful implementation of new platforms, organizations must move away from traditional business principles that explain the management of linear supply chains and conventional service models.
• Networks of excellence: Organizations must form dedicated networks of excellence (NoE) that are driven by a common purpose and must focus on disruptive and emerging trends or themes — coordinating and leveraging the best and most diverse skills and capabilities across the organization to encourage intrapreneurship at scale.
• Dynamic venturing: Organizations are required to pivot continuously to sustain and build new competitive advantage. Part of getting this right is knowing what’s out there and investing to establish the required capabilities of design to deploy.

Business issues

To sustain and build new competitive advantage, organizations must know what's out there and must invest to establish the required capabilities.

Across the general imperatives of growing, optimizing and protecting the business, senior business and tech leaders are focused on one or multiple key business issues:

• Inclusive business growth: Driving top-line and bottom-line growth in a sustainable and inclusive way for customers, employees, shareholders and society
• Globally adaptive products and services at speed: Developing and releasing new products and services for global and local customers faster and better than the competition
• Unique experiences: Creating unique and superior experiences for global customers and employees, digitally and physically
• Meaningful insights: Obtaining and deriving information from various internal and external sources and supporting fact-based decision-making
• Agile organization and diverse workforce: Moving from matrix to network-based organizations with technology enablement and empowerment of multiple levels of workforce diversity
• Intelligent automation: Automating intelligently by combining and integrating robotic technologies with multiple components from different emerging technologies
• Regulatory and risk adjusted business: Adjusting the business in the context of regulatory, governmental and ethical norms and standards
• Continuous business protection and trust: Protecting the business from all kinds of internal and external threats and continuously communicating to all company stakeholders in a transparent way
• Evolving industry and ecosystem positioning: Developing mind and market share in a chosen industry or industries and constantly evaluating and managing relevant ecosystems of suppliers, partners, customers, startups and academia to support companies' positioning.

Technology innovation

Technological evolution has been the result of the combination and recombination of foundational elements of technology. Innovation in the next 10 years will be driven by combining different technology elements in new ways.

Mature organizations can't innovate in the same way that startups do — they can only compete by sustaining their innovation efforts in the long term.

• Artificial intelligence (AI) and analytics: What is AI? We think of it as software that emulates human cognition, but it's really just math at an enormous scale. Leaders must have confidence that their AI systems are functioning reliably and accurately, and they must be able to trust the data being used; having a trusted AI framework addresses this area of concern.

• Robotics: Robotics encompasses both physical as well as software bots. As demand for higher optimization, security and convenience surges, automation via robotics is being adopted across all walks of life, both for enterprise as well as consumer uses. For example, the vast majority of the work involved in large enterprise resource planning (ERP) migrations — such as from SAP R/3 Enterprise Resource Planning Central Component R/6 to SAP S/4 — can now be automated, cutting the cost of the migration by up to 50%.

• Blockchain: Blockchains are, in the simplest terms, shared transactional databases. But what's different is the decentralized model that allows many participants to work together without an all-powerful central entity to manage the network. For example, EY and Microsoft developed a blockchain solution aiming to streamline the costly and time-consuming processes in entertainment rights and royalties.

• Internet of Things  (IoT): IoT is a system of interrelated computing devices, mechanical and digital machines, objects, animals or people that are provided with unique identifiers and the ability to transfer data over a network without requiring human-to-human or human-to-computer interaction. However, even the best and most accurate IoT sensors require calibration and adjustments. AI can be utilized for sensor errors identification management, for example, EY teams have created calibration-as-a-service (CALIBRaaS) to improve measurement accuracy by utilizing AI to do just that. 

• Additive manufacturing (AM): AM is defined as the process of joining materials to make objects from 3D model data, usually layer upon layer, as opposed to subtractive or formative manufacturing methodologies. Companies can prioritize which traditionally manufactured components could be improved or replaced with additively produced parts by using diagnostics, such as EY Additive Manufacturing Diagnostics.
• Immersive tech: With immersive technologies, whether the user is transported to a completely different virtual world or exposed to an augmented real world, the experience is transforming, seamless and immersive. For example, EY Immersive Tech Lab has created solutions such as Virtual Reality dashboards to be populated with interactive charts and unlimited space for visualizations as well as unique interactions with data.
• Security: It's no longer a matter of if you'll face a cyberattack, but when. Every asset in your organization is at risk. Attackers can hack indiscriminately or target specific assets, preying on both large and small organizations in the public and private sectors. Security management solutions provide businesses with greater threat detection capabilities than is possible via traditional log aggregation and perimeter monitoring provided by traditional outsourcing providers.
• Computing: This refers to emerging architectures of high-performance computing and new technologies to transmit data, so contributing to the long-term trend of decentralized data processing. Algorithm training and processing, media management, financial data processing, network and telecommunications, and personal computing are what ecosystems are focusing on and innovating around.

Conclusion

Mature organizations can't innovate in the same way that startups do — they can only compete by sustaining their innovation efforts in the long term. And to do that requires a completely transformed approach to innovation.

Tech innovation is now much more about agility and outcomes. This demands horizon-scanning, including greater awareness of the innovation that is going on in the marketplace and in other industries. Innovation also relies heavily on finding tech to deliver on strategy; success depends on knitting technologies, people and ecosystems together and on swiftly bringing new products, services and ventures to market.