Competitive Leverage: Look to the Future of Technology for Opportunities, Not Challenges

People are notoriously resistant to change. So when it comes to disruptive technologies – such as artificial intelligence (AI), robotics, and machine learning – it’s no surprise that many of us initially view them as challenges.

However, in an era of digital transformation, these technologies must be seen for what they are: opportunities. We need only look at the last 15 years for examples of start-ups and established brands that have turned technologies such as video streaming, online commerce, and mobile connectivity into massive successes – and companies (even whole industries) that have struggled and perished because they were slow to embrace change. Blockbuster, Polaroid, and Borders are just a few brands that have faded faded or gone. Will taxi cab services soon be a part of the past?

Seeing the Opportunities

New technologies present two key business opportunities but companies need to keep an open mind in order to benefit. The first is the ability to create unique and empowering competitive advantages.

Consider how BMW, for example, used AI to manage customer inquiries for two of its new cars. Customers could submit questions about the cars and receive answers back via web, mobile, or social-media platforms. This created a far more convenient customer experience than calling or visiting a dealership, and the AI-based service’s response times averaged only 1.2 seconds with 99.5% accuracy. What’s more, it resulted in hundreds of scheduled vehicle test drives.

The second opportunity is financial.

Companies can increase revenue, minimally in the 1% to 3% range, by using digital technologies to improve business processes such as order fill rates, customer service and customer loyalty. We also can realize operational-expenditure savings of 10% to 30% through improved asset utilization, inventory optimization and better use of production facilities. According to APQC (American Productivity and  Quality Center), the world leader in benchmarking, market leading companies can often have a 40 to 50% supply chain cost advantage over their competitors.

Source: APQC Open Standards Benchmarking (

Source: APQC Open Standards Benchmarking (

A xhange in strategy

Before we can embrace new technologies, we need to make some fundamental changes to our organizations. For instance, digital technologies are no longer just an information technology (IT) issue. They’re a business issue and thus should be discussed at strategic business planning and boardroom levels.

Additionally, we must evolve business planning and modeling to accommodate the fast-changing technology landscape. For example, consider replacing the traditional strengths, weaknesses, opportunities, and threats (SWOT) analysis with a new one: strengths, weaknesses, strategies, and vulnerabilities (SWSV).

[ What AlphaGo Zero Means for the Future of AI. ]

Here’s why. Understanding strengths and weaknesses is a critical baseline to help identify areas for improvement and areas that can be leveraged to position a company’s strategy against competitors, seek “blue oceans or ponds”, and identify vulnerabilities to the existing business model and design new business models, e.g. Business Model Generation.

Identifying opportunities is also a great idea, but without also identifying the potential strategies to put in place, opportunities become wishful thinking. Threats are outside forces that take advantage of vulnerabilities. By identifying (and addressing) vulnerabilities early on, instead of waiting until they become threats, we can reduce the opportunity for others to exploit these weaknesses.

Here’s an example. Transportation is changing quickly and impacting how we create and operate supply chains. Technology advancements are ushering in self-driving vehicles and the “Uberization” of commercial freight can create supply/demand-based pricing for transportation. Do your planning capabilities consider shipping only in low demand periods or are you vulnerable to spikes in rates due to shipping during high demand periods? Are you collaborating with customers and suppliers to optimize rates?

These disruptions could expose vulnerabilities among online retailers that rely heavily on third-party shipping. While this is good to document, it means little unless we also outline a possible strategy to address the disruption head on. A possible strategy could be for the retailer to deploy a solution, such as their own private fleet, to proactively avoid the threat of higher transportation costs. Or, register your fleet as a carrier and leverage it as a P&L versus cost center. The retailer in this case could potentially turn their vulnerability into an opportunity by capitalizing on their fleet in the freight-share economy.

Is time on your aide?

When it comes to taking advantage of transformational change, companies have to know that there’s an expiration date. Technology often has a shorter shelf life than milk. The companies that are able to move quickly to embrace change are also the ones that are able to implement the tools and technologies needed to benefit from disruptions and mine for untapped opportunities.

While moving fast can open up companies to risk, it can also enable faster time-to-market with new offerings that catapult you past the competition. Adopting an “agile” methodology, can do for strategy and the business what it has done for IT development. Viewing technology as the driver of opportunity can even change your company culture – creating a base of change-advocates all driving to make the company more nimble, more customer-focused and more profitable. In the end, we can’t avoid disruptive technologies – more will come. So, take advantage of them by embracing the potential they bring, and looking at the possibilities, not the challenges. 

1 comment on “Competitive Leverage: Look to the Future of Technology for Opportunities, Not Challenges

  1. Mark Taylor
    December 5, 2017

    A superb article Matthew.  On a slightly “organic” note; I do like your simile between the expiration date of new/emerging technologies and milk.  I am sure you'd agree, the pace in which new technologies in AI & automation are evolving, are making the role of transformation & change in the Logistics & Supply Chain industry, increasingly difficult.

Leave a Reply

This site uses Akismet to reduce spam. Learn how your comment data is processed.