“It will affect the way we interact with each other, with our employers and with the organisations that serve us. It will change the way we serve our stakeholders and we manage our businesses.”
He points out convergence and connectivity is disrupting, transforming and collapsing industries, redefining the future of business and how executives will manage companies in the future, he states.
“As connectivity continues to drive convergence, companies need to identify adjacent, periphery products and services that can be added as a part of their portfolio in the future. This will define new solutions, new customers, new partnerships and new competition.”
The interplay between cloud computing, mobile technology, big data and the Internet of Things is driving the surge in digital transformation and rapidly accelerating the pace of connectivity and convergence across all industries.
This convergence is rapidly changing lives and transforming the way people work, relax, learn and manage their health.
Frost & Sullivan’s New Mega Trends, ‘impact on convergence in the future’ report identifies four types of convergence - products, technologies, industries and competition - companies have to prepare for.Read more: 'A global bank can enter NZ without investing in bricks and mortar'
While the concept of self-driving car a few years ago seemed far-fetched, today, digital technology has made self-driving cars a reality and has transformed the driving experience as well as the entire automotive industry.
“Customers are no longer interested in silo based apps or services,” notes Milroy.Read more: Gaining the digital strategy high ground: IT vs. the organisation? Who wins?
“They demand holistic, end-to end solutions for their connected lives and companies understand the importance of convergence for those solutions to materialise, thus incentivising partnerships between energy, security, IT, healthcare, automotive, and other sectors.”
Identifying new convergence areas will stimulate the development of new business models and new product development, says Milroy.
“An integral factor for growth for companies is to understand the landscape of new convergence areas and subsequent opportunities that could be generated in the future.”
He points out digital technology is allowing industries to radically improve their effectiveness and to transform themselves to meet stakeholder requirements much more than before.Read more: Julia Raue: Why we created the Chief Digital Officer role at Air New Zealand
“With a culture of innovation, companies can turn the disruptions into opportunities if they are able to respond appropriately with the right tools and strategies.
“Conversely, companies are likely to put their business at risk if they do not look at changes in other industries and innovate their products and services. As established and global as Apple and Samsung are, they are also constantly challenged to keep innovating to meet customers’ expectations.”
Milroy cites some of the industries that are rapidly transforming as a result of convergence and connectivity.
The music and media industries have already experienced the digital transformation and have radically changed the way we listen to music and watch videos and movies, he states.Read more: Spark NZ’s ‘turnaround’ and transformation continues
“We are increasingly using mobile devices to manage aspects of our lives from banking to booking flights. Digital disruptors such as Google and Yahoo have driven the transformation of the advertising industry. Amazon has driven the digital transformation of the retail industry and has recently played a pivotal role in the digital transformation of the IT industry,” says Milroy..
The automotive industry has also experienced rapid digital transformation resulting in cars that are much more intelligent and autonomous than before.
“Cars can learn and customise the driving experience for individual drivers,” he says. “Cars can learn preferred/typical routes and use them when driving, taking shortcuts where necessary, if for example, there are roadworks.
“It can adjust its route and driving based on weather conditions, it can anticipate danger and eliminate accidents. While the concept of self-driving car a few years ago seemed far-fetched, today, digital technology has made self-driving cars a reality and has transformed the driving experience as well as the entire automotive industry.”Read more: Doing business with Jonathan Stern of MuleSoft: 'How to break the rules'
Several smart cities and companies already have evolved business models incorporating aspects of convergence. Many smart cities have adopted integrated urban systems as a part of their smart city framework. An example is the Amsterdam Smart City Consortium’s rebuild of its smart city framework integrating various sectors and industries within the city.
“Technology firms are being forced to change the way they look at the world and engage with their customers,” he states.
For example telcos traditionally report their activities in terms of broad product categories such as mobile or fixed line. This will change and in a few years telcos and ICT companies will report their activities in terms of the vertical markets that they are serving, says Milroy. "You will see revenues primarily segmented by healthcare, financial services and so on."
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