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IT Challenge n°2: Rise of new Partnership Models

 

 

2020 companies will be totally interlinked organizations within an ecosystem in which new strategic partnerships and associations will be formed, as well with customers, suppliers and competitors!

 

A profound transformation of the ecosystem

The growth of value creation is a major trend in digital era. We witness more and more companies opening up, thanks to the multiplication of the interactions allowed by cloud, data repositories, connected objects … This condition requires companies to rethink their business partnership strategies within their ecosystem in order to succeed in the age of digitization.

This ecosystem is very extensive, with an interesting diversity of actors, such as, GAFA (Google, Apple, Facebook, Amazon), start-ups, innovative SMEs, communities, customers, employees, self-entrepreneurs, suppliers, public and local authorities and political institutions… In the era of “co-something”, a company can no longer succeed alone in its market, particularly because of the rapid emergence of new business models, competitors “out of nowhere” and an accelerated renewal technology.

 

The challenges: anticipate and ally

Controlling the ecosystem depends on anticipating the evolution of it’s different actors, to be noted that actors in the traditional IT are not necessarily those of the current ecosystem, nor, of tomorrow. Some will disappear or merge, others will emerge, many will become partners.

Establishing a good relationship with the right partner, which can be a supplier, requires joint sharing of opportunities and risks, commitment to common goals, and shearing value. And this sharing of value aims to bring something new and positive to the partners, and ultimately to help them grow. Strategic partnerships can be established when there are common objectives for value creation. With this perspective, the partnership is strategic and is quite different from the traditional customer-supplier relationship (even major), in which the parties are bound by a contract for the providing services.

The objectives of each party must be the same and the balance of the relationship arises precisely because of that different but valuable opinions and ideas.

 

Challenges: Negotiation and Confidence

  • Collaborate: one of the typical challenges of partnerships will be to manage the paradox between internal resources (including CIOs) that are experiencing difficulties and struggles, collaborating and, on the other hand, the market, which requires close collaboration to better innovate.
  • Dialogue: companies are confronted with a cultural interoperability challenge in order to engage all the actors involved, even if they do not share a common language.
  • Establishing trust: a partnership relation is always based on trust. Thus, it is not a question of “collaborating to collaborate”, but of collaborating to win together, in order to create communities that engage clients and collaborators.

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R-Link is the result of a long-term partnership between Renault and Tom-Tom. R-Link is an integrated multimedia tablet, driven by a tactile control or an advanced voice command. It combines, the various functions related to multimedia in the car such as, navigation, radio, telephony, messaging, well-being, eco-driving. Renault’s interest in combining with Tom-Tom was to increase the value for its customers, to know them better and to improve the level of service.
This example illustrates the idea of a service platform: Renault added services to its products by developing the customer experience.

 

To conclude, I’ll say that the success of these new partnership model depends only on the business taking much greater role in designing, building, and exploiting the technology, platforms, and data it needs to succeed. Overcoming challenges of traditional IT management is a step forward of bringing IT closer to its true mission and succeeding in all IT collaborations.

IT Challenge : Re-invent business models … or disappear!

Technologies have significantly lowered market entry barriers and the development of free-of-charge models has favored the appearance of business models that have destabilized the positions of historical actors in most sectors.

As a matter of fact, In this digital age, existing approaches to develop, elaborate and describe business models are no longer appropriate for new connected business models. Technologies and services are becoming obsolete faster than in the past, consumers are pleased with innovation and customer experience, the need for agility weighs on production capacities and information systems, therefore cooperation becomes a must.

 

In this changing context, the risk of disappearing, for a company, has never been more present: this is what motivates collaboration and alliances between often competing actors. Cooperation can be seen in a positive competitive way front of the decline phase that threatens businesses of all sizes. This context justifies a reflection on the identification of large organization’s strengths and weaknesses in comparison to their competitors. By 2020, the ability to renew its business model will be critical to the growth and profitability of large firms.

 

Data Capitalizing and Customer Experience

 

Data is the black gold of present and future. But according to Gartner, 85% of the largest organizations in the 500 fortune ranking won’t get a real competitive advantage with the Big Data by 2020. The majority of them will still be in the experimental stage while those who have capitalized on the Big Data will gain a competitive advantage of 25% or more compared to their competitors. Therefore, the development of new products and services, facilitated by the intelligent use of data, creates real changes and new business opportunities.

In a context where the risk of disintermediation is major, control of customer relations, mass customization, co-design with consumers will be fundamental to the success of companies in 2020.

 

Challenges: Differentiating and Innovating

 

  • Understand: it’s essential to keep track of business model and strategies of its competitors of the digital world, the latter being both potential threats and powerful levers of development.
  • Transform: Large groups, especially if they are economically powerful, often find it difficult to transform their organization and integrate innovation, because of their complexity.
  • Listen: anticipating the needs of consumers and focusing on the customer experience means constantly evolving business models in order to develop business agility.
  • Collaborate: creating strategic partnerships with the company’s ecosystem, especially suppliers, accelerates innovation processes and reduces time to market.
  • Adjust: the digital transformation must take into account the context and the business challenges of the company.
  • Innovate: know-how in terms of software development can become more and more strategic for the company.

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