- Brand loyalty is declining due to social networking
- Greater collaboration is needed with customers
- CIOs must come to terms with Cloud Computing
- The economics of the CLoud might not make sense
There's a big change coming in the way that companies interact with their customers and organisations need to be ready for it, according to George Colony, CEO of Forrester Research. Speaking at the analyst firm's IT Forum conference in Berlin this week, Colony spoke of a “gateway recession” bridging two different approaches to management and declared: “It is time for IT to shine.”
He predicted that the way that customers and businesses interact and engage will change and brand loyalty will decline, due to the rise of social networking technology such as Facebook and Twitter. These will empower customers and enable them to scrutinise and discuss brand value with other customers in a way that was not possible before. What was previously regarded as “standard” innovation is dead, he warned, replaced by a new model based on social technology. There needs to be greater collaboration with partners and customers to specify how products and services should be developed. As a result, corporate decision-makers will have to rethink their sales strategies in order to maintain position, let alone in order to acquire new business or customers.
He cited the newspaper industry as a prime example of a sector that has had to change the way it interacts with its audience. “Colleges in the US have stacks of New York Times that are given away for free, but nobody reads them in the colleges. People no longer watch TV,” he said. “Companies must sell to them in a different way - connect to Twitter, MySpace and Facebook to reach customers.” The current economic crisis, he said, will sweep away organisations that do not grasp the importance of and utilise social network technologies.
“As the recession ends, it is time for IT to shine. It is similar to 1987, when companies started embracing desktop computers or to 1997, when companies began to welcome the internet,” he said. “But what will happen in the years ahead is that IT will become looser, not tighter,” he added. “Technology was essentially a choice before for most companies, but digital is now mandatory. The CEO is no longer able to say 'I don't understand technology'. Today's boards can no longer forgive CEOs that don't understand digital.”