Digital Disruption, Transformation, and Competitiveness



Imagine a legacy business, such as Circuit City or Blockbuster Video, competing with a digital native, such as Amazon or Netflix, that has disrupted the industry. A traditional business would need to make a whole host of changes because its established ways of working, value creation, social interactions, and overall business mindset have been disrupted. Digital disruption covers the changes occurring in an industry, while digital transformation helps businesses navigate these changes effectively. Legacy businesses know where they want to be. They just don’t know how to get there. Digital transformation requires a structured approach to IT management that helps legacy businesses ensure their digital business is seamless, optimized, and fast by managing new, real-time technology, including mobile, and cloud technologies.

Industry leaders are increasingly challenged to make big decisions regarding their company’s future as they compete with new digital upstarts. They see that the established barriers to market entry and the competitive moats set by business are coming down, often throwing the status quo into disarray and leaving legacy businesses in the arena looking less relevant. These businesses are having to rapidly adapt or risk going out of business. For example, in response to the digital disruption from Uber and Lyft, taxi drivers are launching mobile apps to make hailing a cab easier for their customers.

Here at BMC, we work with Fortune 500 companies companies to help them become digital enterprises. To help them create value in the new frontiers being made by digital disruption and value in their core business, BMC focuses on changing legacy businesses’ mindset, which helps them make rapid decisions based on data and analytics, and changing their systems and data architecture to help them develop high speed innovation. For example, BMC enabled T-Mobile’s IT department to complete more than 90 percent of change requests within 15 minutes, and Mercator saw a 300 percent rise in self-service adoption.

Understanding Market Disruption

It’s not a question of if. It’s a question of when. How to protect the past and create the future is a hot button inside enterprises today. They need to know how to build a growth-oriented, competitive enterprise while not losing focus on what got them to where they are in the first place.

By leveraging the power of digital solutions and tapping the exploding number of digital channels that can reach out to customers, market leaders and challengers can exploit broader technology and customer trends, redefine their processes to swiftly and effectively reconfigure their products and services, and deliver services faster and in new ways. Such changes are collectively described as “digital transformation,” and there is no avoiding the fact that they are disruptive. The alternative, however, is businesses being constrained in their ability to succeed in the digital world.

The following businesses have embraced digital disruption and found ways to transform and stay competitive. Industry leaders should use them as examples to drive disruption in their own businesses.

Businesses Embracing Digital Disruption

  • General Motors: This company is taking aggressive steps to embrace disruption in the auto industry. It has been a leader when it comes to adding Disruption_GM2Wi-Fi and 4G radio modules to its cars; however, it has been criticized for letting Google lead the industry with self-driving car technology, according to Fortune. GM announced new engineering teams that are devoted to self-driving technology as well as a partnership with ride-hailing startup Lyft, which the company hopes to develop into a fleet of cars that can carry passengers without a driver.
  • BBVA (Banco Bilbao Vizcaya Argentaria): This Spanish Banking giant says that by 2020 it will be more of a software company than a traditional bank, Disruption_BBVAwhich will shake up its competitors and industry. BBVA has created new teams and technology, such as BBVA Compass, which is one of the first systems to provide real-time processing, and BBVA Ventures, which is looking for disruptive startups in the financial industry. Its Chairman and CEO Francisco González states: “Banks that are not prepared for such new competitors face certain death.”
  • Quicken Loans: This year’s Super Bowl advertisement stood out for its effective use of disruptive technology. The “rocket approval” process from the Quicken Loans mortgage commercial promising to “amaze” is a tall claim indeed. From that promise came another promise of jobs for workers, who in turn could buy more homes and stoke the economy. Disruption_RocketClaims aside, the process by which the entire cycle time can be compressed and the support system rewired to be in real time and from a mobile app increases business opportunities and responds to what consumers want in today’s digital economy. If industry leaders imagine processes like these becoming the norm, there’s no telling what fate awaits the industry players who don’t up their game.

Just like these examples, all business leaders must embrace digital transformation to stay competitive in today’s market. Every business should be ready to compete with others when they have their “Uber moment.” Being prepared requires every business to look at its business model and tech readiness.

BMC Disruption_diagramoffers a structured approach to digital transformation that helps businesses respond swiftly and effectively to digital disruption. BMC’s Digital Enterprise Management (DEM) solutions enable continuous innovation and improvement by managing and optimizing technology, processes, and policies in real time. According to a CapGemeni/MIT study, digital enterprises see a 26 percent increase in productivity, a 9 percent increase in revenue to asset ratio, and a 12 percent increase in valuation. Because digital businesses shift the creation and delivery of their services to mobile-first applications, they can better serve their customers by knowing who they are, where they are, and what they need. Digital Enterprise Management gives companies a framework to deliver what their customers want with the best experience at the lowest cost, which enables them to drive digital disruption, productivity, and growth. The “disrupt-ees” can become the “disupt-ers.” The speed and skill at which these tasks are analyzed and performed is what makes BMC’s Digital Enterprise Management solutions essential for businesses to keep up.

BMC’s Digital Enterprise Management solutions are structured around four pillars:

  • Digital Service Management
  • Digital Enterprise Automation
  • Digital Service Assurance
  • Digital Infrastructure Optimization.

Each pillar addresses specific demands placed on IT and transforming businesses. In the following parts of this series, businesses will see how BMC’s four pillars of Digital Enterprise Management give them a structured approach to digital transformation, so they can stay in business, catch up to digital disruption in their industry, and thrive as a competitor and leader in their market.

Video: BMC Digital Enterprise Management

Watch this short video to see how BMC solutions make sure that IT digitally transforms business.

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