Now let’s look at another two pitfalls identified by McKinsey.
3rd pitfall: Don’t overlook digital in B2B
In B2B, digitisation is spreading – sometimes even more than in B2C markets. Companies are lowering costs and improving what they offer. New analytics are enhancing industrial productivity and the quality of manufacturing is also improving. Robotic process automation has digitised up to 80% of back-office operations, at least in some sectors.
4th pitfall: Ecosystems
Successful digital players can spread easily across several industries. And that puts traditional models under pressure. New ways of payment are revealing new competition for financial institutions. The biggest players are creating and expanding their own ecosystems, blending traditional and digital business.
In ecosystem economics, winners have the scale to reach vast numbers of customers. With tools such as artificial intelligence, they deliver top-quality service and everything works perfectly. Facebook is now a giant media player which until recently hadn’t been producing any content. Airbnb and Uber sell their services without owning any houses or cars.
With the onset of ecosystems, the boundaries of individual industries will become blurred and it will be more demanding for executives to identify possible partners and competitors. We can expect the appearance of cross-functional products and services. What were once segregated markets now will become one vast value pool. Alibaba, Alphabet, Amazon, Apple, Facebook, Microsoft, Tencent are all huge companies that are building their own ecosystems.
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