Increasingly, business leaders recognise this reality and understand that long-term success depends heavily on their ability to front-foot and, perhaps more importantly, embrace change.
Within 'digital' there are a vast number of technological developments happening concurrently, and at a rapid pace. There are however three developments in particular that are signalling massive change in how we run businesses and how society will work; both now and in the future. They are cyber security, artificial intelligence and the Internet of Things (IoT).
Cyber security is now fundamental
Cyber security is at the forefront for several reasons. There are more and more examples of the significant damage cyber-criminals can inflict, whether it is stealing information to export for profit, or just doing harm by interrupting and interfering with business operations.
These incidents aren't limited to the headline-grabbing, major security breaches like those that occurred at Sony Pictures, Target, Equifax or Verifone. Incidents of ransomware and other malware is significantly on the increase for New Zealand businesses of all sizes.
Understanding and treating cyber security just like any other business risk is therefore crucial to ensure longevity. The risks are real, and they are turning into actual losses for many companies.
But alongside risk, opportunity is often to be found. There is a flip side to cyber security that can be used to the diligent company's advantage. People are questioning whether they trust the organisations holding their credit card and personal information.
Many Kiwi companies are, at their heart, information businesses. If your company can demonstrate trust in how it treats that information, it can translate into a competitive and reputational advantage.
But how are local businesses tracking on cyber security? Sometimes, I get concerned with the historically accurate perception that New Zealand is a small isolated country, and that the 'tyranny of distance' generally seen as an impediment to trade provides an advantage of obscurity.
The internet has no boundaries. You are mere milliseconds away from any other target and hackers don't care who you are so long as they can make money. Local businesses must make sure that they adapt to the openness of online accessibility and adapt to the real risks they face. The internet has made the greatest economic and social contribution the world has ever seen – but it is not benign. While government is doing good work in the information security space, fundamentally, individual businesses must own and manage their risk.
Doing that doesn't depend on a bucket of money. It isn't merely a technical challenge, it is at heart a human and behavioural one. There are simple things to do that drastically reduce risk: educate people to lock their computers when they walk away from their desk, introduce appropriate password controls, don't plug in that USB stick found on the reception desk. From there, look for advice on how to build security into the risk frameworks so well-understood by most business leaders.
Hyper-connected: IoT
The Internet of Things as a concept is no longer all that new. But the concept is rapidly maturing into viable prospects for business, with the devices, the networks and data processing platforms and applications required to unleash its potential already largely in place today. And IoT holds enormous transformative potential.
At the most basic level, IoT is billions of new devices connected to the internet, with some metrics estimating up to 50 billion in the next few years. Those devices (and the information that flows from them) open a range of opportunities for how organisations can get analytics insight and control never possible before.
Business leaders and directors need to do all they can to understand what IoT could mean for their company; and their industry. It is so powerful a force that it will fundamentally change the world.
Whether connected cities, more information on customers or radical overhauls of the supply chain, the power of data is being unleashed. Those who understand the potential, get in early and start experimenting with IoT, will rapidly discover how and where the advantages for their industry lie.
Crucially, at this point a 'master plan' isn't necessary. But do not delay. Start learning, asking questions, reading, developing ideas. It's fine to fail, as you will learn a lot; do so with an open mind and consider the challenges and opportunities that will become clear.
Think of the business problems you face: a simple one relates to expensive beehives being stolen. The IoT has delivered a simple, elegant solution to that problem, which was costing business owners a lot of money.
Think machines and automation
Computers and computing have already fundamentally reshaped our world; and a new revolution is happening right now. Artificial intelligence – machines that think – is coming into society right now and it is going to be monumental for everyone, from the business to the consumer.
The rate of change and development in space is mind boggling, measured in days and weeks, not months or years. AI is starting to transform whole sectors – just look at transport, where we're seeing the beginning of driverless vehicles that will fundamentally change how we get around.
As machines in the supply chain get more intelligent, they will make decisions previously made by humans, dramatically improving performance. And customer service is being radically overhauled, where already in some organisations you can't tell if you are talking to a machine or a person.
This is happening now, not in 2020 or 2025. This technology is gathering pace and it will only continue to do so over the coming months. Organisations that ignore AI, which don't make it their business to learn, understand and ponder what it means for them, will be out of step with the future. At Kordia, we've already embarked on a trial to see how key processes can be automated, improving efficiencies and, in turn, the overall customer experience.
With AI and IoT – and indeed, other emerging areas of technology – the advice is simple. History is created by some and it happens to others. The creators are immersing themselves. Learning. Playing and doing. And hiring – as Steve Jobs famously said, "It doesn't make sense to hire smart people and tell them what to do; we hire smart people, so they can tell us what to do."
With more of that sort of thinking in New Zealand, the sky's the limit.