Doing Business in the Cloud [in Real Time]

 

Companies need to plug into these communication networks and stay plugged in as technology itself and customer desires continue to change at an accelerating and unpredictable rate. I offer the “Cloud – Social Media – Consumer IT” model as one way to accomplish this. This model says the best way for companies to connect with these real-time communication networks is to interface their internal systems with social media and SaaS offerings and then develop customer-facing applications using social media/SaaS platforms that run on consumer IT devices (smartphones, net books, tablet devices etc.).

 

 

 

The benefits of this model stem from the fact that it’s the best division of labor between all the parties involved and it gives each party the best chances of success. Companies focus on creating and delivering their unique value-add (products and services that customers pay them for). Social media and SaaS vendors focus on creating and popularizing the underlying user interface and making sure their applications continue to run on rapidly evolving consumer IT devices. And consumer IT manufacturers focus on design and delivery of new mobile devices that provide a pleasing and powerful mix of user-friendliness and functionality.

 

We’ve just begun to see what this means yet a few things are already clear. Everything happens in real time now so business agility isn’t just a good idea, it’s the new normal. Future-proofing your business isn’t some grand strategy; it’s the process of plugging into rapidly evolving ecosystems and learning how to communicate and collaborate with customers and suppliers who are using the cloud, social media, SaaS apps and consumer IT. And the best way to navigate our unpredictable markets is for companies to use variable cost pay-as-you-go operating models based on cloud computing that minimize up front investments and enable rapid responses to new opportunities.

 

Another clear thing is that people are figuring out how to apply a body of techniques based on game theory to increases customer involvement and loyalty. Social media is leading the way (for instance, see how foursquare uses game techniques to engage their users). Use of “gamification” techniques will spread at the micro level of individual applications. And on the macro level, game dynamics as seen in massively multi-player online games show how to promote real agility and collaboration between people. Companies that figure out how to apply game techniques to enhance their applications and employ game dynamics to drive their business operations will be big winners in the real-time economy.

 

 

I’ll be talking about these ideas and expanding on their implications at a series of events this fall. This week I’ll be in Seoul, Korea as a featured speaker at the Smart & Cloud Show. The other featured speaker at this conference is Jim Newton who is the founder and Chairman of TechShop. I look forward to talking with Jim because his company is delivering a service that is like the manufacturing equivalent of cloud computing. His company operates a growing chain of store-front facilities where inventors and entrepreneurs can use a range of machinery from injection molding machines to lathes and cutting and welding equipment on a pay-as-you-go basis to create the product prototypes they need to bring their ideas to market.

 

The lead speaker at the show will be Jeremy Rifkin, a senior lecturer at the Wharton School of Business, an economic advisor to the European Union and founder of the Foundation on Economic Trends. He has written extensively about the impact of science and technology on the world economy. In his newest book, The Empathic Civilization, he provides the historical perspective and a big picture context in which to understand what is happening and figure out how to participate as an individual and as a company.

 

Cloud, social media, SaaS apps and consumer IT are evolving at a rate far surpassing anything seen from the days when in-house IT groups controlled technology and created the applications. It is no longer the place of in-house IT groups to question, bemoan or obstruct this reality (“Theirs not to reason why,”); now is the time for in-house IT to figure out how to use this technology to connect with customers and suppliers to continuously deliver products and services that customers want, or else be left behind (“Theirs but to do and die.”). We might not have asked for this exactly, but it is what’s happening and it will be exciting.