Three consultants from McKinsey & Co. collaborated on an article in the January issue of McKinsey Quarterly discussing eight emerging trends in business and technology.
I have summarized and paraphrased the trends here, and you can follow the links below to the complete article and podcast.
1. Distributing cocreation
Distributing cocreation is letting customers, suppliers, independent contractors and others create new products. While this approach to innovation is not widely accepted yet, the impact could be substantial. McKinsey estimates that 12% of all labor activity could be transformed by more distributed and networked innovation.
2. Using consumers as innovators
This is an interesting trend and one that many companies are exploring. Dell lets consumers suggest new product ideas and vote on them in their IdeaStorm website. On the B2B front, Salesforce.com uses a similar application for users to make suggestions to improve their CRM software. In fact, the top ideas from Salesforce.com receive executive-level visibility. Later this month, iRise will roll out their own Ideas application in the iRise Users section of the Catalyze Community – drop me a note at firstname.lastname@example.org if you are interested in learning more.
3. Tapping into a world of talent
This trend is about finding the best talent for an activity, regardless of where the person is based. Software and internet technologies make it easier and less expensive to integrate and manage a distributed workforce.
4. Extracting more value from interactions
As more manufacturing and clerical activites are being off-shored, the resulting work becomes more collaboration and knowledge-based. This will require companies to invest in technology tools that promote collaboration such as communities, wikis, virtual team collaboration and videoconferencing.
5. Expanding the frontiers of automation
There is still more progress to make in automating repetitive tasks, especially in sectors and regions where IT moves a slower pace. Automation is a good investment “only if it lowers costs and helps users get what they want more quickly and easily”.
6. Unbundling production from delivery
More and more companies are unbundling their business models, services, infrastructure and assets to become more nimble, to increase capacity, to scale up businesses and to make the use of certain assets more attractive to their financial statements. For example, Amazon is unbundling their infrastructure and offering it’s logistics and technology services to 3rd parties. Fractional jets, data centers, office buildings and networks are doing the same in the physical world.
7. Putting more science into management
Technology is helping managers exploit greater amounts of data to make smarter decisions and develop insights. Deep customer insights will lead to a richer understanding of a customer’s needs which will enable more segmentation and increased mass customization.
8. Making businesses from information
Businesses are routinely capturing vast pools of data that could be used to create new information-based businesses. Smart companies will aggregate and exploit these data ‘by-products’, but need to watch out for increasing levels of transparency that could out-aggregate these companies.
The original article was written by James Manyika, Roger Roberts and Kara Sprague and is available from McKinsey Quarterly which requires you to register to read it. Registration is free and the quarterly newsletters usually have at least one article that is worth reading in depth.
The companion podcast is available here.