Name Muhammad Ibrahim

Submitted to Sir Yalman Ansari

Semester 5 th (MBA-320006)
Date 15-06-2020

Strategy, not Technology, Drives Digital

Transformation
&
The Digitization of Just About Everything
second machine age
Technology is about to transform the economy much as it did a century ago, when electricity
transformed manufacturing. Now businesses need to reshape their organizations and attitudes to
thrive in this second machine age, integrating three core areas: minds and machines, products
and platforms, and the core (centralized institutions)
Three Fundamental Forces Enabling What They Call ‘The Second Machine Age
 Exponentially improving technology.
 The digitization of everything and the network effects of a connected world.
 Exploding combinatorial possibilities of different innovations that can be remixed in
creative new ways.
Three forces are driving breakthroughs that are surpassing our recent expectations and theories.
They describe the following forces : Exponential, digital, and combinatorial.
1st Stage: Exponential
In the second machine age, exponential technology growth is likely to be quite staggering.
Moore’s law enabled this exponential growth, and today it is common to see a doubling of
computing power every 18 months. This constant doubling has delivered the advances we see
today – many of which appeared after 2006. The digital technology at the heart of these
advances is both fast and cheap enough to enable them. These building blocks of computing
have been improving at exponential rates.

2nd Stage: Digital

Digital is the second force driving breakthroughs, in part because of its ability to foster
innovation. Two very critical properties of digital make this possible: digital information is non-
rival (it cannot be used up) and it has close to a zero marginal cost of reproduction. These two
properties make it possible for innovations like Waze, where digital maps are combined with
GPS information, social, and sensor data. Digital progress enabled Waze to overcome the
limitations of traditional navigation systems, not by inventing new technologies, but combining
existing ones in a way that was not possible before. The global digital network fosters this
recombinant innovation and enables the third force – combinatorial.

3rd Stage: combinatorial

This third force could be the key to understanding the dynamics of our environment, and this
insight brings it into focus: the number of potentially valuable building blocks is exploding
around the world, and the possibilities are multiplying like never before. They effectively make
their point by focusing on key technological advances of the recent past: the driverless car, IBM
Watson, Siri, 3D printing, Robots, and others. This tell us that not long ago; many believed that
computers would never substitute for humans in areas like driving a car. Yet here we are on the
brink of accomplishing just that.

Strategy, not Technology, Drives Digital

Transformation
Three three key trends that will impact digital strategy going forward as well as the leadership
approaches and cultures needed to support them.

ACHIEVING DIGITAL MATURITY (Adapting Your Company to a Changing World)

Adapting to increasingly digital market environments and taking advantage of digital
technologies to improve operations are important goals for nearly every contemporary business.
Yet, few companies appear to be making the fundamental changes their leaders believe are
necessary to achieve these goals.
1st trend: Early Companies
Lack of strategy Barriers: At this first stage more than half cite “lack of strategy” as a top-three
barrier
Customer and productivity driven: approximately 80% cite focus on customer experience (CX)
and efficiency growth
Siloed Culture: 34% collaborative; 26% innovative compared to competitors
Nterest Talent Development: 19% say their company provides resources to obtain digital skills
Lacking skills: 15% say leadership has sufficient digital skills

2nd trend: Developing Companies

Managing distractions: Nearly half indicate “too many competing priorities” is a top-three
barrier, “lack of strategy” still a challenge for one-third
Growing vision: CX and efficiency growth; over 70% cite focus on transformation, innovation
and decision making
Integrating: 57% collaborative; 54% innovative compared to competitors
Investing: 43% say their company provides resources to obtain digital skills
Learning: 39% say leadership has sufficient digital skills
3rd trend: Maturing Companies
Security focus: Nearly 30% cite security as a topthree barrier; managing too many competing
priorities remains a top concern for 38%
Transformative vision: Over 87% cite focus on transformation, innovation and decision
making
Integrated and innovative: 81% collaborative; 83% innovative compared to competitors
Committed: 76% say their company provides resources to obtain digital skills
Sophisticated: 76% say leadership has sufficient digital skills

Digitally maturing companies behave differently than their less mature peers do. The difference
has less to do with technology and more to do with business fundamentals. Digitally maturing
organizations are committed to transformative strategies supported by collaborative cultures
that are open to taking risk. Equally important, leaders and employees at digitally maturing
organizations have access to the resources they need to develop digital skills and know-how.