Over the coming decades, the use of technology by companies that will win the race to provide the best experiences will be turned upside down with profound implications for every aspect of their business, from customer experience, to core operational processes, to the very nature of their products and services. To meet and exceed customer expectations without continuous input from customers, we have entered the predictive era, ushering out a decades-long reactive past.
“We have entered the predictive era, ushering out a decades-long reactive past.”
In the reactive past (“application first”), data flew “downward” from the applications that powered business in small drops or completely disappeared into the darkness of systems, organizations, and silos. For the customer to gain a next level of service, a new form was required to be filled or a new number needed to be called.
Let’s use the car industry as an example. A customer typically purchases a car from a dealer. One day the car stops running. The customer calls the service center and reports a problem. At that point, the service agent opens an application, types in notes about the problem, and schedules a repair visit. That may be the first moment in years that any data related to that relationship has been noted, even if it was only a few kilobytes stored in a database and only in reaction to an event. And the manufacturer of the car may never see a single byte of the data.
This example can be seen across industries. Most enterprise and business applications are still no more than digital encapsulations of business processes used in the 1950s—not much more than pencil, paper, and rooms full of filing cabinets. Nothing transformational there. And day-to-day, it is often the customer who needs to “integrate” between these applications and companies.
Today, the available technologies enable a different approach. A customer can purchase a car from a dealer. With appropriate permissions granted by the owner, the car provides a continuous stream of data back to the manufacturer and perhaps also to the dealer. The car may be self-driving and run a lot of data logic and computing power. It connects to the computer vision models in the cloud that are trained with the help of the data captured by sensors and cameras across the entire fleet. Every operating parameter of the engine, every press of the brake pedal, every trip route, every song listened to, even the risk factors of the driver profile provide a rich basis for prediction and can help maintain an ongoing and higher-value relationship between the owner, the dealer, the manufacturer, and even those who provide additional services such as gas/electricity, repairs, insurance, and financing.
This will be true for every vehicle, every thermostat, every piece of factory equipment, every social media update, and every video call. Every single action on the planet is becoming a source of data and potential insight. This drives the fast-paced adoption of the Internet of Things (IoT) that is now enabled by the power, reach, and connectivity of the global cloud infrastructures, faster data transmission speeds, lower latencies, and more robust reliability offered by 5G and next generation wireless technologies and a new arising theme of “Edge Computing.” In Edge Computing, the technology platforms and innovation extend the core cloud and application technologies to vehicles, factories, robots, hospital floors, and more to enable local processing of data for further automation, intelligence and action.
“In the predictive era (“data first”), data flows upward”
In the predictive era (“data first”), data flows “upward,” originating from every corner of the planet toward our customers’ applications, products and services.
From this data, impending failures can be predicted via an anomaly detection model and addressed proactively so that a driver is never left stranded on the side of the road. Better entertainment options can be suggested based on a driver’s preferences and those of similar drivers across the customer base, and better routing options offered by the navigation system based on citywide traffic patterns. Even the car itself can predict an impending accident, braking to avoid a collision. And the list goes on with endless possibilities. The car can connect with the identity of the driver to maintain repair histories, cost structures of fuel consumption, charging profiles, or even complete payments with the energy company when connected to a charging station. All of this is possible if the supply chain in the back end is able to provide the expected outputs based on the data insights on time. This can be fully automated: the scarcest resource we have is time, which is what we can help the customer with! No more endless customer service loops!
“The enormous changes to come will reconfigure entire industries.
The technology behind this is essential to address the needs of an “as a service” culture.”
And of course, every data-driven, AI-powered action produces even more data, fueling a digital feedback loop of continuous learning and improvement. When we see a pattern, we can proactively get things fixed and avoid causing the same issue to other customers.
The enormous changes to come will reconfigure entire industries. The technology behind this is essential to address the needs of an “as a service” culture. Extending from our example, car ownership could become outdated. Manufacturers may become service providers; customers may become subscribers; and dealers may play an entirely different role in the reconfigured industry.
This is one example from one industry. But the opportunity exists across every industry, every customer, and every business process. Leading in the predictive era requires most companies to broadly transform in fundamental ways. They have to transform digitally.
This article was written by Belinda Gerdt, who has built a successful international career in some of the world’s leading technology firms. She has almost twenty years of experience of developing digital customer-oriented businesses. Currently working for Philips at their headquarters in the Netherlands, she leads global marketing and helps digitize the healthcare industry.