Dealing digitally with disruption
9 February 2017 | 0
‘Disruption’ and ‘disruptive’ have become fashionable words. What we mean in markets and IT is something that halts, changes or diverts our normal gait of going — which has probably not been in a steady state for more than a few months or weeks anyway. It is getting close to marketing speak, with companies promising disruptive technology or products.
Yet disruption is a truly powerful phenomenon in our digital age, particularly in its frequency. Technology and development of all kinds have been accelerating through the last two centuries, characterised especially by ICT in recent decades. The rate of new apps launched passed 1,000 a day in 2015 but has remained at roughly the same level since then. The rate of usage, on the other hand, continues to soar and we passed a significant point in 2015 also when the numbers of personal users accessing the Internet by mobile overtook fixed line subscribers.
In business, disruption can take other forms: Brexit is certainly one, the Trump Presidency looks like a runner and wars and natural disasters (and climate change) continue to play a key part. Disruption can also take the form of delay or suspense sometimes — ask any logistics company with clients in the UK, Ireland and the continental EU.
In that huge set of contexts, disruption is a constant challenge to any business and in fact most organisations. The first challenge is to leadership and decision making, choices of strategy and coping mechanisms. Then management will have to implement the plans — speedily. IT systems are inseparable from these business processes, from alerting to the impending disruption to feeding data into the decision making and implementing the responses. Human leaders make the decisions, by and large smart and powerful systems implement them.
“Digital disruption was a swell that has become a tsunami in the last seven or eight years,” says Neil Sholay, Oracle EMEA head of digital. “In EMEA, we have become almost two speed, with countries like Germany, France, Spain and the UK fully understanding digital business and developing ideas at pace for new products, services and even entire new business models. At that level, the phase of ideation and experimentation has passed into practical implementation, looking for and encouraging organisations and people to bring innovation to the real markets.”
“Even more importantly, they want it all at speed. We are in a world of “Not soon — now!” It’s like Amazon Prime — purchase to home delivery in an hour. It’s an API economy — everything available through simple web links. Oracle actually saw this coming and for about eight years has planned its move on from old monolithic systems and suites to clouds and microservice apps. The applications are re-built to be cloud-first apps, each performing a discrete function and assembled together for the greater functionality rather like Lego bricks. Those chunky, monolithic application suites are of the past.”
“In Oracle we saw this coming a full 10 years ago and began working to rebuild all of our major software, like financials and Siebel CRM, from the ground up as Fusion Apps using the latest tech, open standards and the cloud. It’s a different software world today,” Sholay says. “But at the same time this whole concept of pick and mix, choosing from a palette of many different apps, enables speedy change and agility but also brings the risk of errors. This is where governance, security and the DevOps approach have to be carefully combined. Just because you can launch a new service in an hour and half doesn’t always mean you should.”
“For the last few years I have seen CIOs take a lot of bad press, with some suggestions that the CDO role will make that of the CIO redundant,” he says. “But I think that has changed in the past year or so with the growing appreciation of the rigour of being a CIO, understanding that the governance and resilience and discipline of systems are important and how to manage that responsibility. Apps can fail or under-perform. What is very promising at trial level with five thousand users may not be so great when scaled to half a million. We have generally moved to a level of understanding that the digital transformation needs a blend of all of the skills. The discipline and rigour are as important as the agility and flexibility.
“I remember about 10 years ago working with the IT team of a major retail bank in the UK to develop a new service in wealth management. Its aim was to enable individuals to take advantage of some aspect of tax law. After three months or more, literally on the eve of its launch, the Chancellor changed the tax laws and the planned service became useless. As it happens, the core of the application was built using a type of flexible app technology, so we were able to remove the ‘wrapper’ and launch a similar service about three weeks later taking advantage of the revised tax structure.