Digital Strategy No 1: IT Teams and digitising the past

April 2016

Technology changes everything, and nothing. In 1954 Peter Drucker wrote “The purpose of business is to create and keep a customer”. PropTech evangelists might be telling you that they are going to change the world, and you, old timer, are going to be disrupted out of business, but you know what, that just isn’t going to happen. Or at least it need not if you take both Mr Drucker’s 62 year old advice and arm yourself with a healthy dose of up to the minute digital savvy. In my view the modern property professional needs commercial nous, domain knowledge and technological skills. Any two will not do, and in that sense the new world is much the same as the old; it’s just the content that is being updated.

What is different is that in the digital age, the volume, variety and velocity of information one has to deal with in business is many orders of magnitude greater than 10, let alone 20 years ago. And that means you need both new tools, and new processes. Hierarchy, and distinct departments within a business worked perfectly well when data was analogue, when information could be passed slowly along a conveyor belt of due process. Remember when mail order meant delivery ‘in up to 28 days’? Well, in those days, not so long ago, you frankly had all the time in the world to get from A to B. Today, those 28 days are collapsing to minutes and much of the time you have no time. And when you have no time, traditional organisation structures just lurch from failure to failure. In this world you need to think networks, where each node is connected to multiple other nodes. Managing complex, fast moving environments needs a diversity of inputs, and that needs teams, or more correctly teams of teams, where groups with specialised knowledge are able to work together rapidly and iteratively. Read General Stanley McChrystal’s book Team of Teams for more on this.

This move from hierarchy to networks is why embracing digital technology is not about IT. In fact, a truly digital company, such as Amazon, has no IT department. Instead of a siloed capability, no doubt buried in the worse space in your office, you need IT skills to be embedded throughout your business. Creating and keeping a customer will involve technology, to a greater or lesser extent, so when planning each and every touchpoint with your customer you need to work out what is required. And the best way to do that is to involve people with the requisite IT skills during the process of designing those touchpoints. How many times have you been alerted about some new service, or research, from a property company, only to find that when you look it up on your smartphone on the way home it is unreadable on a mobile? That is what happens when technology is a bolt on to your business, not part of its DNA. In 2016, like it or not, every business is a tech business.

Once you move away from silos and hierarchical thinking it becomes easier to not commit the No 1 technology cardinal sin, digitising the past. This involves taking an existing analogue process and just putting a digital front end onto it, without thinking how new technologies could be co-opted to make it faster, easier, cheaper or simply less hassle for your customers. For example, you might be asking someone to fill in details of where they are, what time is it, and what the problem is; all things that smartphone in their pocket already knows. In fact, as sensors proliferate, both in smartphones and throughout the built environment there is a whole host of possible data points you could utilise to deliver more contextual, real time information to your customers. That’s how you keep a customer.

As new technology opens up new functionality human behaviour starts to change. Not the other way around. Netflix only exists because of broadband, Uber because of smartphones. Think of your value proposition and your customers and then think how you could use technology to provide more of the former to the latter.

Kodak needs to be your warning here. Many people think it was the move away from film that brought the company down, but it was not. In fact Kodak moved decisively into the world of digital imaging. Their big mistake though was focussing on printing digital images, just as people pretty much stopped printing out their photos. Classic digitising the past; they thought people would carry on printing as they always had, and that it was just the change from film to digital that mattered. The past though was a bad guide to the future and despite huge investment in digital they went bankrupt in 2012.

Technology changes nothing, and everything. Embrace the digital age. And read Peter Drucker.