FORRward: A Weekly Read For Tech And Marketing Execs
Apple’s 2019 Event: What’s Missing Is What’s Telling — Branding
When Apple cuts prices, you know there’s a problem. A price premium signals brand strength; any contraction is a cause for concern. Yes, Apple’s decisions to start monetizing services is a good strategy, but is it enough? It comes straight out of every management consulting playbook from the last two decades. We have to ask: Where’s the imagination? Apple “brands different”: It converts a humble MP3 into “1,000 songs in your pocket.” It creates entirely new categories and violently disrupts existing ones — and brilliantly explains to consumers the magic inherent in such changes. The absence of emotional resonance around this business decision is a reminder to any enterprise evolving its strategy: Customers benefit from the business model, but they buy the brand. At the Apple event in 2019, we got good strategy. Maybe next year, we’ll get brilliant branding to go with it.
WeWork: Tech Co.? Real Estate Co.? Maybe — But Not A Stalking Horse For Change
WeWork wants to be a technology company to justify the valuation of its last round of funding. But WeWork is really a commercial real estate management company that uses technology particularly well. It operates more efficiently and probably deserves a higher multiple. Most of our clients want to harness technology to run better and enter new lines of business. They will point to startups like WeWork or Uber to rally their CEO and board. Unfortunately, we’ve found that such evidence can backfire when these unicorns collapse in value. A better tactic: Make your customers the rationale for change — they expect and deserve a better experience. That, and a business case: Run the numbers before (and ongoing) to show how technology, people, and process change can slash costs and improve experiences to accelerate your pace of innovation.
Software Quality Management: The Stealth Competency Of The Modern Enterprise
In his recent HBR article, Why Fixing Software Bugs Should Be the CEO’s Problem, author Nicholas Bowen points out the radical impact software failures have. Example: Toyota leadership’s inability to recognize the prolonged software failure in Lexus ES300s. Many execs — laser-focused on revenue, product distribution, and brand image — do not prioritize software quality to their executive committee and board. Even as companies such as Philips Healthcare enhance product value with software and industry 4.0 manufacturers have software robots rewriting supply chain flows, leaders can underappreciate the importance software quality plays in their new world. CIOs and CTOs must now keep software quality front and center for their firms’ enterprise leadership. But as software increasingly affects the customer experience in digitally evolving firms, marketing leaders must also ensure that the brand promise is maintained in these new experiences. Low-hanging fruit: Work together to make software quality management part of your monthly report to enterprise leadership.
Adding AI Is Not Just About Buying/Building The Tech: Get Your Org Ready, Too
Pragmatic AI solutions finally replace hype. GE Healthcare received FDA clearance for an intelligent imaging solution that can detect collapsed lungs before doctors. Stalwart Prudential Financial paid $2.3 billion to acquire startup Assurance IQ, which delivers personalized insurance options. While this move to add practical AI is sound, it requires another investment: in culture, workforce skills, leadership styles, organizational structures, and business processes. AI projects don’t usually fail because of the tech. They fail because organizations aren’t ready to use them effectively. What leaders can do is invest in RQ, the robotics quotient, a measure of the ability of individuals and organizations to learn, adapt to, collaborate with, and drive business results from intelligent systems like AI, automation, and robotics. Forrester just released RQ 2.0, the newest version of our assessment tool: simplified, with new examples. Check out this two-minute video and the full report.
Incremental Change Won’t Drive The Growth You Need
Our clients are seeking growth. To help them, we recently compared advanced innovators that are growing at 3x their industry average with firms not growing at all. Interestingly, we found few differences in top business priorities — everyone wants to improve CX, grow, improve products and services, innovate, and reduce costs. However, when you go down to the bottom of the priority stack, advanced, high-growth firms are 1,100% more likely to prioritize changing their business model. In this climate of disruption, you are probably making such a change already or petitioning your board for it. But there’s a catch: Incremental innovation — often seen as a safe route to most boards — is insufficient. Technology helps your competitors copy every incremental improvement you make in digital experience and product. Sustainable competitive advantage comes by delivering customer value in a new way that involves people and process change, which is much harder than technology change. See “Video: Unlock Explosive Growth.”