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In the present, it is undeniable that the walls that used to separate different industries from each other are gradually being torn down. We can see this from observing how computer and technology corporations such as Google, Apple, or Uber step out of their traditional industry of technology and into competing against the German giants and industry leaders such as Mercedes-Benz, BMW, or Audi in the driverless vehicle industry.
Most importantly, these new contenders seem to have the upper hand as well. This is because for the move into driverless vehicle market, the experiences in old business might not be as crucial as data or mapping system that companies such as Google possess. And this is why, in the driverless vehicle market, Waymo, a subsidiary brand of Google (Alphabet), seems to be ahead of other players.
Likewise, it should not be surprising to see retaliation by the German carmakers, when the 3 aforementioned brands, the long time arch nemeses who have all been at each other’s throat for so long it appears they could never see eye to eye, all decided to join hands and collaborate on establishing 4D mapping company called Here to break up the advantage enjoyed by the technology companies. And to this end, they have appointed the former Vice President of Cisco, one of the world’s leading technology companies, as their commander in chief to lead them into the battle.
Apart from the intense competition, we are also seeing the peculiarities and the chaotic nature of this industry; whether from Waymo partnering up with Avis, while Apple’s driverless vehicle company partners up with Hertz, or the partnership of Ford and Domino Pizza. Yes, the pizzeria and the car company. But we don’t want you to just imagine a driverless pizza delivery car, rather this is a whole bus service for domino pizza!
Meanwhile, Huawei and Audi have entered an agreement to develop driverless vehicles, or the fact that Toyota invested $500 Million in Uber. Even Sony is trying to develop an AI system alongside this market, and as for Apple, they have been looking far ahead and are buying up AR mirror manufacturers and start dabbling in the content business, believing that driverless vehicles will bring about a change in people’s behavior in their cars, and increasing demand for this business.
We haven’t yet counted Elon Musk, who is seen as the market leader as much as he is leading in the electric vehicle (EV) market, or Masayoshi Son of SoftBank, who has been spending investments from Arab Oil Tycoons all over this industry.
The meaning of all of these is that the walls of old businesses are so torn down that all the players can easily walk over them back and forth, just as the mindset that has long prohibited competitors from becoming collaborators has also been brought down as well.
The same example can be applied to other businesses or industries with ease. Whether in Telecommunication, Finance and Banking, Retailing, where there is a domestic example such as SCB, a giant in the banking industry, and KBank, who are all edging closer to becoming technology company, or even Super Apps such as LINE, who is quickly gaining ground in the financial and content industry.
But while old walls and frameworks are being torn down, boundaries defining new and challenging businesses are also emerging.
In a report by Eamonn Kelly, an advisor to leaders in various innovation-led organizations, published through Deloitte Insight, the author makes an observation that there are 3 main boundaries which will define businesses and challenge executives of the future:
(1) The boundary between man and machine
How to best implement robotic-automation and Artificial Intelligence to the maximum benefit for your organization, and create the best value for customers
(2) The boundary between service providers and users
How to create an equilibrium in an era with Co-Creating or Sharing Economy, such as Airbnb, or YouTube, where customers can simultaneously act as creator as well.
(3) The boundary between physical and digital world
There is no clear distinction between websites and product shelves anymore. Instead, there is a widespread adoption of technologies such as IoT or AI to assist in business model known as ‘Clicks and Mortar’ rather than ‘Brick and Mortar’, which has led to the idea of ‘omni-channel’, or physical stores which implement digital technologies such as AI or Face Recognition to assist in scanning and reading the emotions of shoppers to provide the best shopping experience to them, as in the case of Walmart.
The breaking down of old business walls, and the drawing of new and challenging boundaries have led to challenges for the executives in various business organizations. While this is fraught with difficulties, it also hides immense opportunity as well.
These all lead us to a question we would like to invite organization executives and business owners of the future such as yourself to ask: how many business strategies are there that would allow your organization to not only confines itself to the current business in defense, but to enable it to enter into attacking position and cross over into other industries like never before? Here, we lift 4 lessons from 4 organizations who not only were able to scale over the old walls, but have also successfully challenged the new business boundaries as well.
(1) Maximize existing value like LEGO
From being a toy company on the brink of bankruptcy, LEGO has spread their value of Learn & Play far and wide into new businesses such as LEGO Foundation, which emphasizes on learning from playing in adults and children alike, and LEGO Land, a theme park business serving as one of the funnels supporting fans’ demands globally. This has led to LEGO Film and Game, which employ both in-house content creation and collaboration with famous film studio to create chart topping films and games. All these are served by an organization called LEGO IDEA which acts as an idea repository, or, in other word, the organization proprietary Think-tank unit. This is not only just a crossing over of old business wall, but it is also a challenge to the new business boundary as well.
(2) Making leaps from within like X, the moonshot factory (formerly known as Google X)
It is well known that Google acts as a template for innovation building from within the organization by its allocation of 20% of work time for its employees to create innovations. Google X, or X, the moonshot factory, as it is today known, is a business unit established to encourage and push for innovations that can solve big problems 10X by using internal resources and extend them outward. Waymo, one of the leaders in driverless vehicle industry, is also one of the products of a special business unit with a culture sets on achieving Moonshot such as this.
(3) Conglomerate to greatness like LINE Thailand
When you have both enough customers and potential, merger and acquisition as frequently exhibited by LINE Thailand is a surefire way to strengthen your business and business ecology by leaps and bounds. By acquiring developer team of DGM59 who developed customer management tool, and following this with the acquisition of SellSuki, a startup which specializes in social commerce, who has made retail activities through online social media much more efficient, LINE Thailand has made headway from being a communication application to becoming e-commerce in a short span of time. Not only this, LINE is also an expert in managing its customers who use its stickers function to becoming sellers of the stickers, which is a boundary defining new business too.
(4) Drive all parts to new land like SEA Group
SEA Group may not be as familiar as Garena, a renown game company, or Shopee, an e-commerce competing on equal footing with Lazada of Alibaba, but both are group companies of the newly set up parent company, SEA Group.
A very interesting aspect of this Unicorn-level startup founded by Forrest Li, which today sees itself and tries to elevate itself as being a world-class giant in the technology business, is the long term planning to involve the public sector and education sector to create understanding and readiness for the future in both its human resource and policy making through a newly created position of Group Chief Economist, SEA Group, who drives all business units at an equal pace. This is also the first time that a technology company has such a position, and this is an idea which is no less interesting.
If you’ve read this far, then we hope that you would have acquired a measure of ideas and directions to lead your organization and business to handling challenges of tomorrow.
But if you demand something wider and deeper, then the good news is that in CIS, or Corporate Innovation Summit, Asia’s first experiential conference focusing on Corporate Innovation with emphasis upon practicality which will be held in Thailand on Thursday and Friday 28th-29th March 2019 at Centara Grand and Bangkok Convention Centre, Central World, the leaders of organizations serving as case studies you’ve just read will be in attendance in various experiences they employ within their organizations including giving keynotes and Q&A session on the main stage, running workshops, and talks at the fireside chat stage they employ within their organizations. These include:
Former Experience Manager, LEGO IDEAS
Session: Building Blocks for Corporate Innovation
Factory Whisperer, X, the moonshot factory
Session: Strategic Story-telling: Lesson Learned from
X, The Moonshot Factory
Group Chief Economist, SEA Group
Session: An Outlook for Regional Corporate Innovation
Managing Director, LINE Thailand
Session: Harnessing Innovation Through Strategic M&A
Because perhaps the learning for executives and new generation of business owners might require leaping over MBA degree or learning from books to a close exchange with leaders of world-class organizations who have all challenged the boundaries of new businesses before.
Special Deal! Save US$200 from the standard price US$1,499 until Friday, March 1. For more information, please click here.
Credit: AHEAD ASIA