Owning or buying stuff is, well, so last-century.
I have piles of old CDs and DVDs gathering dust at home but haven’t owned a DVD player for years and my latest computer doesn’t even have a CD/DVD drive. My iTunes library is empty except for a couple of films and CD titles I bought years ago. Now, I just rely on streaming subscription services like Spotify or Netflix for my entertainment.
I’ve always hated owning cars. Now, I can skip around Paris and other cities using a multi-modal mix of public transport and transportation services delivered by Uber, Zipcar, Autolib, Vélib, Cityscoot etc. I no longer have to worry about residual value, parking, theft, insurance and all the strictures that go with car ownership.
In the business world, IT infrastructure, platforms and software is now delivered as a service. Assets are disappearing from the balance sheet and are being replaced with usage or subscription-based contracts that provide flexibility for businesses to respond more effectively to demand.
Worldwide adoption of these new digital services has been astonishingly rapid. Uber has delivered more than 2 billion rides since it was founded. Netflix and Spotify have respectively 83 million paying subscribers and 30 million paying subscriber worldwide. Amazon Web Services is already a $10 billion business. The Internet of Things, which will transform dumb devices into a plethora of connected self-monitoring objects, is estimated at $1.3 trillion in 2019 by IDC.
The scale of change raised by rapid adoption of these digital services has raised the fear of « uberization » (think of tire-burning taxi drivers in Paris) but the likelihood of stalling the momentum of change is slight.
Who will succeed in this new world of digital services, of everything as a service?
Obviously having a great execution, a strong value proposition and awesome customer service will be important but having powerful monetization systems will also be crucial.
In this new, real-time transactional economy, bloated, complex ERPs will no longer do the job since this new service-driven economy require monetization systems that can provide:
So how does your current system stack up? Are you ready for the digital service economy?