CTO Daily Dose - What Is Digital Transformation
Transcript
hey how's it going - Steve peiser from the CTO advisor comm with today's CTO daily dulls believe LEM not it's already sweater time here in Chicago I get off the plane from vmworld today in a little chilly so we're gonna talk about digital transformation one of the outputs from vmworld 2017 was a lot of engineers not just engineers a lot of technical people really smart technical people that respect walk away saying what is digital transformation that just sounds like a buzzword similar to sulfur defined data
center isn't the data center run by software already so we've had the argument about software-defined data center it is a theme digital transformation is a thing and we're going to start the conversation actually off with a industry that went through a digital transformation and still get disrupted or at least is in the process of being disrupted so we're going to talk about the hotel industry entry that's been around for basically hundreds of years and the hotel industry in itself hasn't really changed there hasn't been up
to the until the past few years any real innovation in the service of delivering hotel rooms however the back end of it has really changed a lot over the years which has enabled tremendous growth and we're gonna just talk about invent advantages of technology so let's take one of my favorite change Hilton Hotels because I started there as a housekeeper they went on this buying spree where they bought a bunch of brands and properties they were able to do this because of their back and IT
infrastructure Hilton had one of the most advanced reservation systems in the world you could call up a reservation agent here in Chicago which I was stationed out of and make a reservation for any Hilton in the world this was all due to Jeff and the major investment and really what we consider to very legacy infrastructure however there was a bit of friction between the reservation agent which is the role that I played and the consumer looking to reserve a hotel room if a consumer wanted to
reserve a hotel room there was no website you could go to you basically have to go to a reservations agent talk to the reservations agents the reservations agent access the backend IT systems and then reserve the blocker rooms for the customer obviously there's some inefficiency in this model so what the hotel industry did was that they were one of the first industries to embrace digital transformation instead of having a layer of Technology in between the user or the consumer and the actual product they put the
technology closer to both the product in the end consumer so as a consumer I could just go to my mobile phone my webpage and webpages for years the hotel industry has allowed this digital transformation where as a consumer I could replace the reservations agent I could go to a website access the technology directly to book a room anywhere in the world so the hotel industry has been digitally transformed way before there was a concept of cloud computing and in past is etc etc they've embraced this
concept of being able to use their back-end technology exposing that back-end to the in the end user of their service and reducing the friction in between the user and the service now of course Airbnb has take this have taken this idea to the extreme and they've used technology to not just disaggregate the user experience but also the inventory they've enlisted a ton more providers and allow this b2b transaction where a consumer can be a provider or a provider can be a consumer and now the hotels
have to compete with not just a digitally transformed organization but a innovative organization so the ideal is digital transformation is not just about technology it is about enabling business processes that didn't exist before for the hotel industry there was two innovations over the past basically 15 years the first innovation was the removal of friction between the user and the inventory by enabling this layer of technology the second innovation was to use that very same technology to create new competitors and a new model of product in
the industry so two major innovations but that didn't stop the hotel industry itself from being disrupted by other organizations that use digital technology so digital transformation and simple terms is about reducing the friction between the consumer of a product and the product of in itself it may in turn create new product categories such as Airbnb or uber and the ton of other sharing economy technologies for older industries such as GE in there IOT in in industrial that may mean that they may have to transform to
able those big hard machines to talk to the technology so that the end-user or the consumer has a better experience with that analog product that's it for this episode of the CTO vizor daily dose I hope this helped if it didn't you know what looked me up on LinkedIn Keith Townsend on LinkedIn I'll have this video posted we can have our conversation you can reach out to me and we can have this discussion even further or visit me on the web the CTO advisor comm or
on twitter at CTO advisor talk to you guys next CTO daily dose
