On the Eve of Disruption: Summit Keynote Will Explore How Digital Transformation Affects Nearly Ever
“Disruption,” in addition to being a much-used term in the business press, is a two-edged sword: an exciting prospect if you’re the one doing the disrupting; not so much if your company or industry finds itself being disrupted and forced to scramble and adapt. Some disruptions may be temporary—as, we fervently hope, will be those spawned by COVID-19—while others are likely here to stay.
It’s these more lasting and far-reaching effects that will be the subject of a keynote address at the ASAP Global Alliance Summit, now scheduled for late June, to be given by Steve Steinhilber, global vice president of ecosystems and business development at Equinix. The presentation, titled “Creating Alliances and Digital Ecosystem Capabilities in an Increasingly Platform Enabled and Interconnected World,” will examine how the speed and scale of information technology growth and new global platforms will enable—and even necessitate—the digital transformation of nearly all businesses, creating many new business models in the process.
According to Steinhilber, the speed and rate of disruption varies by industry, but many existing value chains are already under significant disruptive threat. Industries that are “content sensitive or highly inefficient value chains” have already experienced this disruption, he said, as whole segments of the value chain have been eliminated. These industries include advertising, newspapers, movies, and retail, as well as the travel industry, including hotel bookings and other reservations services.
Others are either just starting out on this journey or find themselves somewhere in the middle. Steinhilber cited the automotive and transportation services industries as examples of verticals that are just beginning to experience the waves of change, while “all layers of the IT industry and also the satellite launch industry” are in the midst of ongoing disruption.
According to an IDC survey, by 2022—less than two years away—at least 60 percent of global GDP will be digitized, with growth in every industry driven by digitally enhanced offerings, operations, and relationships. And according to McKinsey, digital ecosystems will account for more than $60 trillion in revenue by 2025, or more than 30 percent of global corporate revenue. As we’ve seen—and if you haven’t already, check out our cover story on ecosystems in the Q1 2020 issue of Strategic Alliance Quarterly for more on this trend—these disruptive forces are enabled by an explosion of information technology delivered via platform-enabled companies monetized by new business models. These platform models are proving to be much more profitable than product pipeline business models, and also offer accelerated time to market for new products and services and create new ways to share the wealth. This has directly translated into massive growth in platform companies’ market capitalizations.
These new ecosystem- and platform-based models have significant implications for how partnering frameworks and practices are changing, said Steinhilber, requiring “a blend of both strategic, high-touch partner management as well as low-touch engagement via new tools and systems.” And as organizations as a whole struggle to adjust and adapt, today’s—and tomorrow’s—alliance and partnering professionals will need to change their ways, too.
“They’ll still need conventional strategic alliance skills in order to manage complex, highly strategic relationships,” Steinhilber said. “But they’ll also need to have the ability to build programmatic models to engage companies that are wanting to innovate on top of the platform. This means implementing new financial models such as revenue sharing, deploying tools to automate partner engagement and management, developing dashboards that can manage rapid scaling, and being able to ensure the quality of what partners are offering on your platform.”
Curious to learn more? Me too! Stay tuned for more information on this and other outstanding presentations to be offered at the upcoming ASAP Global Alliance Summit.