In the early 2010s, leaders at the consulting firm Accenture watched technology disrupt industry after industry. They eventually reached a critical realization: the same would happen to them. Accenture’s core businesses—professional services and outsourcing—would become commoditized. It was time for reinvention.
As teams innovated, they also reinvented the process of reinvention. The firm reported doubling its market cap in just five years to more than $100 billion as a result. In their book “Pivot To The Future,” Accenture’s Omar Abbosh, Paul Nunes and Larry Downes describe the firm’s strategy as a “wise pivot.”
“The wise pivot is an alternative to the traditional large-scale business transformation,” Nunes says. “The wise pivot is an agenda of embracing innovation across your entire business—your ‘old,’ ‘now’ and ‘new’ businesses—to quickly create new value from all three.”
Here’s how Accenture’s wise pivot philosophy can help businesses thrive in a more connected era.
A Wiser Way To Transform
While it’s natural for companies to pursue change as tech-related challenges and opportunities emerge, the often uncertain pace of that technological evolution makes timing tricky. As Nunes explains, the old or traditional approach to transformation is that organizations transition away from old business lines before obsolescence drags down its new businesses.
But that mindset is outdated, Nunes says. Instead, the wise pivot focuses on transforming an organization in three lifecycle stages: the “old,” the “new” and the “now” lines of business. Maintaining and improving the old lines of business help to preserve profitability, ultimately supporting more innovative ways of doing business in the now and allowing for investment in the new.
“It’s about transforming the old businesses to embrace new technologies and create the fuel for growth as opposed to getting rid of them,” says Nunes. “It’s about growing the now using technology and innovation to continuously improve and grow the current business—as well as to scale the profitability of the new.”
And that goes for every business in every industry. “It’s not a niche strategy. It’s clearly essential for fast-moving industries,” Nunes says. “But we’re finding it’s increasingly important to every industry because every industry evolves at the pace of its fastest-changing technology. As digital becomes the core of more industries, those industries will need to evolve at a digital pace.”
Pivoting Into A New Era of Connectivity
This comprehensive, strategic approach to business transformation can help leaders prepare their organizations for the next big leap in connectivity—the transition to 5G networks—which could create big opportunities across industries in the future.
“We will be able to create extended virtual realities, which are going to allow people to do things as if they were present anywhere,” Nunes says. “The transformation of place will be profound at the level of pre-smartphone to post-smartphone.”
The major upgrade in connectivity will unleash a wave of new technologies because of increased reliability. “Innovation is bottled up because there’s a huge difference between 90% availability and 99% availability,” Nunes says. “A mobile payments app only becomes your preferred method when it’s extraordinarily reliable.”
Businesses will not only be able to offer more reliable technology to customers, they’ll also be able to integrate next-gen tech into their operations, enabling a pivot toward new and improved ways of working.
“Think about traditional things like construction, and how [5G will affect] everything from GPS on the individual workers to the nature of work coordination,” says Nunes. “Of course, [connectivity] profoundly changes the new because as it grows exponentially, we find opportunities that were once limited by speed and cost becoming possible. Working at home was something we’ve seen. Now, we’re talking about running a factory or performing surgery from your bedroom.”
Preparing To Evolve With 5G
Nunes says business leaders should be looking to create partnerships with providers now. Leaders need to recognize that 5G applications will require interconnected ecosystems that cross traditional supply chains and industry borders. Capturing the future value of 5G will require early and sustained engagement through industry consortia and corporate venture funding.
“You can no longer create those partnerships at the pace of punctuated change or the pace of wanting to do something,” says Nunes. “The time is now to begin identifying dance partners and experimenting with new forms of collaboration and co-investment.”
Evolve The Old, Invest In The New
Accenture’s outcome of a doubled market cap is no small endorsement of the wise pivot strategy. But for Nunes, metrics are just part of the story. The most important result, he says, is that the approach allows organizations to get the timing and pace of their growth just right.
“Because the exact pace of technology improvement and invention is so uncertain, it’s really difficult for leaders to determine the timing of the new,” Nunes says. “By maintaining and innovating in the old, we created the fuel for growth that helped us spend over $1 billion in new acquisitions. It also helped us accelerate and maintain competitiveness in the now.”
Businesses of every size and in every industry have the potential to do the same on their own scale. By cultivating partnerships and continuing to develop and evolve old lines of business while investing in the new and the now, leaders can position their organizations for the next era of mobile connectivity.
Learn how public and private sector organizations alike plan to leverage the game-changing impacts of the coming 5G era at t-mobile.com/business/trends-and-insights.