We are currently witnessing the maturing of three technological concepts that have the potential to change society as much as the Internet. In the future, digital agencies could use the Internet of Things, artificial intelligence and block-chain as approaches for new business models.
With the help of the future technologies Internet of Things, artificial intelligence and blockchain, digital agencies are becoming tech companies and could in future offer these as possible approaches in a toolbox, individually or in combination, to firmly reinvent any business model for companies. However, clients must ask themselves which technological approaches are relevant and how they can implement the blueprints from the toolboxes of the new tech companies in a targeted manner. A guest article by Alexander Janthur, CEO of the digital agency Turbine Kreuzberg in Berlin.
A short anthology of future technologies
Currently IoT, Blockchain and AI are being thrown into the pot of future technologies. The technologies can be simplified into two camps, which in turn require different skills. AI and Blockchain are software approaches, whereas IoT has an indissoluble link to hardware. AI and Blockchain enable manufacturers and retailers, for example, to predict certain requirements and digitize processes.
By means of successive and independently learning algorithms, AI allows processes to be organized much faster and in smaller units than would ever be possible with human processing. Blockchain is a decentralized storage technology that offers high security and allows diversified rights management. It thus enables a precise definition of who is allowed to access which of the stored information and when – and who is not.
Internet of Things based on hardware
Unlike AI and Blockchain, IoT is a hardware-based topic. Software is implemented in mobile and immobile things, they receive digital images, through which an infinite amount of information is added to the sensor technology, each of which holds enormous business potential. The background is also that sensor technology is becoming more and more affordable and bandwidth is available more and more as a matter of course.
IoT thus stands for the mechanisms by which sensors are networked and static things such as cars, vacuum cleaners or refilling shelves begin to communicate with each other and with the users. The sensor itself is not intelligent in itself, but a recording device that measures data such as distance or weight. The actual magic – the intelligent element – does not take place on sensors, but in the linking software solution behind them. This is where Blockchain and AI come into play. All three technologies contribute to a trend that has been gaining momentum for the past five years, namely the platform approach.
Platform economy enables technical innovations
Innovation today works platform economically. This means that a basic product or service opens up space for external innovators who can further develop the idea and invent additional products. The goal is to provide companies with a comprehensive, new and digital ecosystem that is able to incorporate the products and services of competitors. Digital agencies are therefore no longer primarily consultants, but will become tech companies in the future. They provide their customers with the necessary knowledge and the technological building blocks for the specific needs of the customer to get their promising innovations moving.
Real added value as a common goal
The goal of innovation projects changes along with the increasingly differentiated technologies. The new and old economy are on the verge of reaching a point where innovation is no longer aimed at optimization, but rather at inventing and discovering new business models before competitors and new players in the market.
Companies are increasingly realizing that customer demands, whether B2B or B2C, have become far too comprehensive to be met by a single company alone. Mergers and acquisitions – and frequently also takeovers or consolidation tendencies in markets – will therefore shape markets across all industries in the future.
Future technologies cannot replace market analysis
It may sound trivial, but when it comes to digitization, a comprehensive anamnesis is an absolute requirement before taking the first step to action. The first step is to understand the value creation in the company, to deeply penetrate the business model. Only by understanding how and why an organization functions can fundamental changes in projects and processes be specified, initiated, promoted and accompanied. Otherwise, the probability increases that a potentially innovative digital project will be carried out without creating real added value for the company.
With the following four steps, companies can identify their own need for technological innovation:
1. the first step begins virtually at zero
Companies must approach technological approaches in a playful manner and inspire their own employees with enthusiasm for the topic. The joy of innovation must come from within or receive a creative impulse from outside. Employees need freedom for creativity and curiosity instead of pressure to be “innovative” – regardless of how much competition may be ahead and the need to find solutions quickly. Companies should create spaces in which employees can and should specifically deal with new things, and anchor this freedom institutionally. In this way, companies approach technologies that fit in quite organically.
2. in the next step the own expertise forms
The basis for the decision whether the technological innovation should be implemented most effectively via hardware (IoT) or software (block chain, artificial intelligence) – or whether in the end the combination is needed. It is important not to start with all three technologies at once. Ask yourself the following question: Which issues are causing discomfort for both the company and its customers, and how can the problem be solved? This is where technological innovations come in. At the same time, it is important not to limit innovations to the areas of expertise that are already represented in the company. In particular, previously untapped potential could be hidden in areas of expertise that are not yet represented in the company. It is important to bring external experts into the team in good time, either in an advisory or operational capacity.
3. in the third step it becomes clear that each of these technologies does not work in isolation
Companies will find that networking is needed that combines different technologies. IoT technology needs artificial intelligence to develop its potential. Finally, the block chain makes it possible to make the goods detected by the sensor and ordered by the AI traceable because the supply chain is redundantly secured. During development, the first use cases can emerge which initially have nothing to do with the company, but which do introduce the possibilities of the technologies. These learning effects can then be applied to the first real prototype.
4. the first prototype must not fulfill the claim
- To implement the chosen technologies perfectly.
- Technological innovation must be seen as an ongoing process that is developed openly and iteratively.
- Despite all the flexibility, however, the overall goal must not be lost sight of, which is why company-specific key figures should be defined that make the path to innovation success measurable.