Over the past fifty years, technology within businesses around the world has improved at pace. No longer do we have manual general ledgers, telex machines, typewriters or faxes. Instead, businesses have digitised to varying degrees; at a minimum, capturing unstructured data in electronic format (for example, documents created, saved and shared within an organisation), and at full potential seeing digitisation of structured workflows and interactions. This may include the capture of data (at the point of activity), storage, analysis, insights, and decision-making support through cloud-hosted, specialised platforms which now touch every aspect of businesses operations.
These platforms are now commonplace, and in many cases the productivity gains are unarguable. End-of-period accounting which may have taken a highly trained, dedicated accounts team weeks can now be completed by a relatively un-skilled practitioner in close to real-time, while information dissemination from operational platforms enables real-time decision making and optimisation which improve business productivity immensely.
Within organisations, productivity improvement from digitisation and optimisation has been on a meteoric rise, however a number of these gains have now been captured. Further improvement is now increasingly reliant on heavy investment, customisation and radical changes to ways-of-working, systems, and processes. As such, the next ‘revolution’ of productivity improvement is unclear.
Between organisations (i.e. company-to-company), the process of digitisation has scarcely begun; it is this which has the potential to drive the next major wave of business productivity over the next 25 years. Whilst the idea of writing, printing and sending a letter to a colleague seems increasingly far-fetched (bordering on ridiculous), paper-based processes between organisations remain commonplace. For example, procurement, legal, and regulatory interactions between organisations remain at best an ad-hoc exchange of unstructured information (i.e. over the phone, or email), and at worst, are conducted via post in much the same way as the early 20th century.
Digitising (and organising these exchanges into structured data) will be difficult. Any structured exchange of this nature requires an agreed set of rules, a communications means, and a way of transforming the exchanged data to/from a format that can be used within a sender or receiver’s business. Despite these challenges, progress has been achieved within both a global and Australian context, for example:
The next wave of improvement in systems of this nature is likely to come from both an increase in functionality and an increase in penetration:
In summary, while organisations have typically done a good (and sometimes great) job of digitising themselves, the ‘quick wins’ from this transformation have now increasingly been captured. To continue to increase productivity in line with the last 30 years, we need to increasingly focus on how businesses interact with each other. This won’t be a simple process, however there are now sufficient proof points to demonstrate that this will be a worthwhile journey.