Classical management practices describes
the traditional value chain as consisting of marketing, sales, operations and
billing activities which work together with the aim to deliver customer value
propositions.
In reality the value chain
components are owned by various departments in the organisation and information
sharing and integrated processes are rather myths than realities. Functional
blaming is an organisational sport – something that one needs to master to
survive. Business Schools, Enterprise Architecture and ERP systems support this
thinking and much of management energy is spend on re-engineering,
restructuring and process optimization between the functions to deliver better
customer experience.
Fortunately technology has passed
conventional thinking and starts to enable “on-demand” services which turn old-school
value chains up-side down. Instead of relying on a “push” value chain, customer
demand “pull” the value chain into action from a marketing, sales, operations
and billing within a few minutes.
This can only be done if one
views all data and processes in context as a system to deliver on “pull” rather
than a “push” system.
How can this be?
Take the taxi service Uber (with
all of its controversy) as an example. All of its information on geographical customer
demand, driver availability and location are in context via space & time.
Because of this, pricing is not a separate financial discussion, but kicks in
by providing real-time quotations based on the customer’s real-time requirements.
It happens in context of the customer, the driver and time (peak/off-peak) –
allowing effective yield management to play across time and space for optimal
supply and demand contracting. Company reputation is not something that is addressed through long-winding strategy sessions – but relies on the service
delivery that takes place when the service is concluded and rated by the
customer. Again, customer experience is placed within context of the
transaction, customer and service delivery in real-time.
Not only can the value
chain be completed in 20 minutes – but this level of integration and automation
creates a business that can scale – Uber expanded in 153 countries within four years. The hidden
gem here is that due the context of information, business assets operate much
more productive to their competitor’s assets – something that will be hard to
beat on price and service in the short, medium and long term.
