MIT Sloan Management Review

Few new technologies receive more intense interest than 3-D printing, with some predicting that it will revolutionize manufacturing. That promise remains emergent. But it is taking shape in some industries, such as shoes. The shoe company New Balance thinks that within five years it will custom-make shoes with 3-D printers. And there are already entrepreneurial fashion designers trying to leverage 3-D printing to build up their presence in the market.

One of the largest health insurers in the United States, WellPoint, is using technology to change its business model. Lori Beer, WellPoint’s executive vice president of specialty businesses and information technology, talks about how technology is helping doctors and nurses be more efficient and effective and lowering costs. Beer explains how WellPoint, which is the first commercial adopter of IBM’s Watson technology, is using analytics to help health-care providers work more efficiently.

Starbucks chief digital officer Adam Brotman and chief information officer Curt Garner explain how they collaborate closely. The two constantly seek to improve customer experience through technology and to unify marketing efforts across channels. Their partnership has forged a fast-paced rollout of new digital efforts, from faster payment processing to mobile ordering, across Starbucks’ 17,000 stores.

As new markets emerge, large multinationals can find it hard to respond to them quickly. In the mid-2000s, specialty insurer Chubb felt it needed to move faster, both in its product development and in the way it responded to questions and issues field representatives had. Chubb integrated multiple social media tools into a social business platform that has improved response time. It also has held more than 50 online innovation gatherings, yielding several successful new businesses.

That ideas can go viral is now a given in corporate marketing. But new research suggests the term “viral” marketing does not describe well what happens in the market.

Sharad Goel, senior researcher at Microsoft Research, and fellow researchers wanted to see whether messages spread via social networks virally, “like the common cold, some sort of biological contagion. One person gets infected and their friend gets infected and a friend of their friend gets infected.”
That wasn’t what Goel found.

GE believes companies will boost productivity and profits by using intelligent sensors and analytics to predict when parts and manufacturing lines will fail. This will smooth operations and accelerate product development. GE is investing in its operational use of intelligent sensors and hiring software developers to create better algorithms for analyzing huge amounts of data. William Ruh, head of GE’s global software development center, discusses the reasons behind GE’s investment in new technologies and why it thinks these will transform the global economy.

3-D printing is the printing of solid, physical 3-D objects. “Just as the Web democratized innovation in bits, a new class of ‘rapid prototyping’ technologies…is democratizing innovation in atoms,” Wired magazine’s longtime editor-in-chief, Chris Anderson, stated in Makers: The New Industrial Revolution. Indeed, open-source 3-D printing fits in with the general trend of open-source innovation by collaborative online communities. The big question: How should existing companies respond?

The Internet Revolution has so far not produced the kind of long-term productivity growth seen during the Industrial Revolution. Digital technology drove U.S. productivity growth above three percent annually only between 1996 and 2004. Since then, productivity has fallen to about 1.6 percent a year. General Electric argues that productivity growth will jump again as the industrial Internet emerges, connecting machines like turbines and jet engines to factories, and using analytics to make better decisions about maintenance and production.

New research suggests that companies with well-managed investments in digital technology and transformation management can achieve up to 26% more profits than their industry average. A digital maturity model developed by MIT’s Center for Digital Business and Capgemini Consulting combines two elements: digital intensity (the level of technology investment directed towards changing how a company operates) and transformation management intensity.

Does large amounts of data equal large amounts of new knowledge? Sometimes it does. Applying analytics techniques to social network data reveals new things about how people make decisions, say two Facebook researchers. There are also advantages that come from the ability to more quickly find patterns in data than was previously possible, says a scientist at Microsoft Research. But the CEO of Personal.com predicts that many companies will find that data analysis is not a core skill.

Remember geography lessons in school, painstakingly memorizing the longest rivers, cultures of various regions, the state capitals? For most of us, those lessons are in the past. But in the world of big data analytics, geography is making a comeback.

The relatively new market of location analytics is expanding the uses of more traditional geographic information system (GIS) technology to include social, geographic, physical and emotional indicators that help organizations better predict trends

Business leaders hear plenty about how digital technology can transform a business, but so much of the discussion focuses on technology-based companies like Amazon, Apple, Facebook and Google that executives at traditional companies might be forgiven for thinking that only high-tech startups can achieve digital transformation. In this video, George Westerman of the MIT Center for Digital Business explains how business executives can drive digital transformation within established companies.

Companies such as Apple, Amazon and Facebook aren’t the only ones who can use high technology to get bottom-line results. For instance, PagesJaunes, the French Yellow Pages, has completely changed its business model with a strategy of building 100,000 websites for small businesses.

Companies need to invest in four kinds of digital capabilities to achieve digital transformation. They must start with a unified digital platform to integrate data and processes across sales channels. They need a way to revamp solution delivery to adapt new technologies into their operations. They need to develop analytics capabilities, which often requires a change in corporate culture. And they need good working relationships and tight integration between business executives and information technology executives.

Today, the task of the global strategist involves not only identifying where to leverage a company’s strength but also how to enhance and renew its capabilities. The experience of many global companies suggests that expensive mistakes are often made when companies don’t ask key questions before making internationalization decisions. By better understanding their own competitive advantages and how they might fit into or complement a new market, companies can improve their chances of success.

Online retailing is the fastest growing retail sector in the United States. The growth is being fed by two forces: (1) traditional retailers getting their “Internet acts” together, and (2) “pure play” online retailers becoming innovative.

This article does a deep dive into two groups: online retailers selling popular-brand consumables for the home; and online retailers selling specialty items. The findings have implications both for pure-play Internet retailers and for traditional retailers.

The growing number of chief marketing executives reflects the increasing importance companies attach to marketing. Yet the average tenure of a chief marketing officer (CMO) is three and a half years, well below that of the typical CEO. Both the prevalence of the CMO position and its precariousness give rise to the question,“Has marketing realized the vision to which its adherents have long aspired?” This article asks if that question is an important one — and where marketing goes from here.

A surprising number of high-profile Western companies have stumbled in e-commerce in China, including Amazon and Google. This article offers a list of workable strategies to succeed in Chinese e-commerce, gleaned from U.S. companies’ experiences.

There is no one-size-fits-all solution. However, in a market like China’s, where local knowledge and culture are crucial to success, more thought should be given to how to better serve local customers and adapt in a rapidly changing market.

Everyone has experienced the frustration of having to repeat voice commands multiple times before finally asking to speak to a service representative. Many large companies have become so focused on optimizing their business processes and systems that they have become all too willing to forget about cultivating emotional connections with customers. But in order to detect and respond to shifting customer needs, companies need to show more, not less, empathy with their customers.

The next wave of Enterprise 2.0, says MIT Sloan’s Andrew McAfee, will center around the concept of harvesting expertise, solutions and knowledge — not just from within the organization, but from anywhere that expertise can be identified and gathered.