In an everything-as-a-service economy, hi-tech players have to play by the new rules. The era of one-time sale, long time lags between new releases, and bare bones post-sales support is now gone. In the digital age, like every industry, hi-tech players need to focus on delivering superior customer experience, iterating and improving their offerings faster and in-line with customer needs, and developing long term engagement with customers. This calls for a rethink of products and services strategies and business models.
The tri-vectors of change
Driven by customer demands and in the quest of profitability, the hi-tech industry is undergoing a three-pronged transformation along the vectors of revenue, business models, and operations.
Building digital products: A bid to stay relevant
The new market realities demand a multi-dimensional change impacting multiple decision points and are driving a significant change in the way the hi-tech industry develops and sells products and services. From just product focus, industry players are now thinking about how their products can support end user outcomes.
Today, peripheral companies that earlier sold point of sale (POS) systems have moved to mobile point of sale (mPOS) systems with greater mobility, ease of use, and sophisticated UI/UX. The semiconductor industry is trying to offer 5G capabilities on chip to offer speed that can support AI systems in digital products. Collaboration based software players are developing collaboration tools with AI – for example, you can now record a call and get a system-generated transcript. Storage providers are shifting from flat pricing to pay-per-use consumption models. Telemetry is becoming a norm to develop intelligent products. Everywhere you look, products are going digital.
The shift to digital products and services requires a structured approach. First, understanding where the opportunity lies – what are the untapped areas that can be addressed? Next, deciding what to change first – which product line, software, or hardware change can create the maximum impact? Then come the decisions on the new IT requirements, new ways to create and launch offerings, need for fast iterations based on market response, opportunities to cross sell and upsell, and finally taming the beast of organizational change management.
This change is happening at the intersection of three areas – data driven insights, customer journey mapping and experience, and IT modernization.
However, the biggest shift that needs to happen for digital products and services in hi-tech industry is the mindset change - the willingness to let go of the old approaches and embrace the new world order.
Navigating the winds of change
The move from a capex-led model to an opex-led one is not easy. While over time this shift ensures a larger consumer base, in the initial stages of this move companies see a revenue drop. For example, Adobe has proved time and again that this strategy is rewarding in the long run as customer affordability increases, volume drives revenue, and there is better visibility in to potential revenue. Yet for organizations contemplating change, it is difficult to make the first move and requires strong leadership and decision-making.
The fundamental change that is required is to pivot the entire organization to a customer first approach. Take for instance, the sales organization. In this era of post-sale, on demand, attention economy, hi-tech companies need to focus significant attention on the after-sale spectrum. Till now sales personnel were incentivized on product sales. Now incentive design must change to reflect the Opex model. Even sales approaches need to be re-looked to align them towards delivering customer experience, focusing on renewals, and gearing them up for post-sales support.
Customers today want the minutest, most uncomplicated slice of the product they can use, available whenever and however they want it. Going digital is the only way companies can deliver on these demands. Hi-tech players that focus on building digital products, improving customer experience, and investing in collecting and analyzing product insights will clearly have an edge in the digital game.
David Ranjit William
Digital Head, Technology BU, Wipro Ltd.
David has over 20 years of IT experience working in the Communications & Hi-Tech industry. He is responsible for driving the Digital strategy for the Technology BU at Wipro. As part of this role he is responsible for demand generation, competency building, solution enablement and brand building initiatives for the Digital business within the Technology BU.
Director - Digital, Technology BU, Wipro Ltd
Rahul is a problem solver and manage digital strategy for the customers in Technology industry. He specializes in Improving Customer experience, Subscription Business model and Tech enabled Marketing business transformation. Rahul has done Post merger integration and consulting roles in his previous stints and is based out of bay area.