- Category: July 2014 - Marketing Analytics
Recently I got hold of an excerpt of the timely book "Digital Darwinism” by Ralf T. Kreutzer and Karl-Heinz Land that has been released in German around a year ago and will be available as an updated English edition in around eight weeks.In their book the authors allude that companies have to develop their own business models further in terms of the digital transformation not to fall victim to “Digital Darwinism”, saying that all those companies can become a victim that do not adapt quickly enough to the new requirements that the new trend of DiSoLoMo combines. Neglecting the trend could mean to miss out on new business opportunities that could be developed and exploited with "digital", "social", "local" and "mobile" (DiSoLoMo) business models.
DiSoLoMo is the basis for the “Internet of Things” (IoT)
"Digital" encompasses the phenomenon that not only products, but also services such as bookkeeping tasks, document management or complex IT applications, are digitized and made available via the Internet, which in turn replace entire business processes such as books, newspapers, magazines, or movies:
"Social" means that the communication on the Internet is already dominated by the user - keyword "User Generated Content" - and companies often only "react", when they are mentioned in the social networks.
"Local" refers to the trend towards more and more applications that experience their relevance due to the spatial proximity, such as e.g. the local coupon allocation for "Location Based Services" (LBS).
"Mobile", finally, describes that the mobile access to the Internet continuously gains momentum and importance. Therefore, every company should ask itself whether it can provide relevant content for the emerging app economy – even if it is e.g. just in form of an app for finding public toilets, if your company sells toilet paper.
Thinking outside the box is essential
After the invention of the steam engine in the mid-18th century and electricity in the late 19th century, we are in the midst of the third industrial revolution, which is driven by the ubiquitous "internetization" and is embodied by the "Internet of Things" - the connection of a variety of objects that get controlled, evaluated or used via the Internet.
Although the key drivers behind the adoption of this developing trend are convenience, fun and in a broader sense learning, the effects of this power- and system shifts are without doubts similar to those in the past: Business models that have been successful over many years and decades are now receiving rejections by the market.
The authors Kreutzer and Land point out in their book that the increasing “internetization” of our daily lives creates space for new business concepts that use the DiSoLoMo trend as a tailwind rather than a headwind. It is literally in line with the times and Joseph Schumpeter’s seemingly paradoxical term “creative destruction” that has been adopted by generations of economists as a shorthand description of the free market’s messy way of delivering progress.
Embracing the IoT opportunities and challenges is crucial
Therein exactly lies the challenge for companies and their employees, therefore encouraging us to invite all CTOs and CIOs, who want to analyze these new business concepts at our upcoming event. MediaBUZZ will gather decision makers of established businesses who are open to new ideas and don’t want to run the risk of oversleeping the third (digital) industrial revolution!
Fact is that if companies are not willing to take up the new market forces constructively, it is to be feared that the prognosis of Brian Solis, a designated U.S. Business Specialist becomes true, saying: "70% of the Fortune 1,000 companies will be replaced in a few years. Not because they didn´t get enough fans on Facebook, but because they didn´t adopt to the new networked society!” In fact there is something else that has to be considered as well, the fact that other than in the financial industry – here there is neither a "too big to fail" nor a "too small to succeed"!
Or to use the words of Charles Darwin: "It is not the strongest of the species that survives, nor the most intelligent that survives. It is the one that is most adaptable to change.”
By Daniela La Marca