CEOs: Disrupt your Business or Get Disrupted

The restructuring will allow Dow to continue its journey toward speeding innovation through technology. Already, noted Liveris, investments in bioinformatics and robotics have increased the number of experiments Dow conducts on behalf of its business customers from 20,000 a year a decade ago to 2 million a year.

Recently, for example, Under Armour approached Dow looking to make its line of athletic shoes bouncier, water-resistant, temperature-resistant and less likely to degrade over time. “Normally, developing a polymer that would support that would take two to three years,” said Liveris. “We did it using chemical engineers, biomatics, robotics and materials science in three weeks.”

Speed is just as critical in the B2C market, where customers expect to be able not only to find whatever their hearts desire at their fingertips, but to receive it within days—or, in the case of pizza, within minutes. Domino’s, which built a national chain around the promise of speedy delivery, upped the ante on that model in 2015 with a pizza ordering app that not only guarantees easy and fast access to a pie, but lets you track it on your smartphone every step of the way. Today, digital orders account for 35 percent of the company’s sales and deliver a higher repeat customer rate, higher spending and higher satisfaction.


3. ARTIFICIAL INTELLIGENCE (AI) WILL INCREASINGLY INFORM DECISION MAKING. The unbiased decision making that comes from data being plugged into algorithms can inform rather than replace strategic decision making, asserted David Kenny, general manager of IBM’s Watson Group. “It enables you to see patterns and identify solutions.” For example, Kenny described Watson’s effort to use genomics to help doctors treat a leukemia patient who was failing despite six years of aggressive treatment. “After analyzing her DNA and treatment data, Watson proposed she could actually have two strains at the same time,” he said. “The medical team addressed the second strain and now that patient is perfectly healthy.”

Algorithms can also inform business decision making, noted Eric Felsberg, national director of data analytics at law firm Jackson Lewis. For example, when an HR department receives an overwhelming number of applicants, computer models can help cull through the onslaught and generate a list of qualified candidates for a new hire. “In a lot of cases, the answer is in being able to look at the folks who are successful now and replicate that,” he explained, noting that removing human bias also helps guard against legal issues by ensuring that qualified candidates aren’t overlooked.

“We all bring our biases to the table,” he said. “If I am a recruiter searching through documents, I am exercising some kind of bias and prejudice. By having algorithms in place, you can take those out. We believe there is a certain human interaction that has to happen, but that using technologies can narrow the gap.”

In a similar fashion, AI can help management weigh strategic decisions. Kenny predicted a day when almost every large company will have a robot director on its board. “If you are considering making an acquisition, selling the business or making a big capital expenditure, there are implicit models that go into that decision-making process that an AI system can use,” he explained. “Then your other
directors will add judgment on top of that. The decisions are better when it is the man and the machine working together. From the boardroom right up to every major decision, AI will become a tool in our lives.”

4. COLLABORATION IS ESSENTIAL TO INNOVATION AND EFFECTIVE TEAMWORK. Tapping the potential of digital technology often requires assembling multidisciplinary teams—from external as well as internal businesses—who share data and insights. For example, advances in medicine are far more likely to come from collaboration between colleagues or companies than from a lone scientist toiling in a lab, asserted Judith Dunn, global head of clinical development at Roche Innovation.

“It’s changed how we hire and how we do business,” she said. “I have a theoretical physicist—a math whiz—whose job is to model disease. I pair him with a biologist. Their work helps us understand safety and efficacy more thoroughly.… We’re also finding that more and more therapies are combination drugs where we need to find out how our drug and another company’s drug work together.”