The TikTok Moment – lessons learned from the modern day Sputnik Moment of #DigitalTransformation

Free Stock Photo of Leadership Concept with Paper Airplane Created by Jack Moreh

This is a Guest blog post from Jet Lu, digital innovator and digital transformation leader who is Director of Digital DevOps for the City of Baltimore.

On October 4, 1957, the Soviet Union launched the world’s first artificial satellite, Sputnik 1, from the Baikonur Cosmodrome. It was perceived as a technological gap between the United States and Soviet Union, and caused public fear and anxiety. Days later, president Dwight Eisenhower addressed the nation with a subdued message: “So far as the satellite itself is concerned, that does not raise my apprehension-not one iota,”. However, it wasn’t long before Eisenhower declared the true crisis and threats the United States must confront. The true crisis and propaganda coup as the result of Sputnik was not truly suppressed until 10 years after, when we put the first and only humans on the surface of the moon. That is still standing true until this very day.

We got over the crisis and took lead in the competition by accepting the competing factors, and excelling ourselves to be the best at it. We have to give the same sense of urgency and priority to digital transformation.

In August 2020, executive orders were issued aimed to ban social media platforms TikTok and WeChat. These may not be familiar names to many prior to the political hype, but it does not change the fact that they have 500 million and 1 billion active users respectively. There’s a global competition over artificial intelligence, cyber security, digital connectivity, and digital influence. Unfortunately, we do not have a solid lead in the race anymore, and some analyst may say we are losing the lead position. If you haven’t come to the realization this is at the same scale, if not greater, than the historic Sputnik crisis, then you have positioned yourself behind the eight ball. 

We have hit a ‘TikTok moment’, and I want to coin this phrase. I want our children to remember this moment and what it means in history. Why? Because once again, we are in reactive and defensive mode. It is the crossroads of a modern day revolution, a digital revolution. We should use this as fuel for digital transformation to truly come out ahead of the race from this ‘TikTok’ crisis.

We have long been in the state of a developed country. However, have we achieved being the first digitally developed country? The digital equity issues across the States screams “digital crisis.” The digital world is borderless, and it invites your competitors to your front steps. It can be a healthy competition though, or even a healthy collaboration if handled right. It is not all necessarily negative. We must take the right steps as we confront the challenges and threats it presents, and take aggressive and transformative steps forward. I’m not a politician. I’m a transformation leader, and in today’s world, the focus is digital transformation. Banning TikTok or WeChat is an attempt to avoid the risk, but there are more effective steps we should take in order to mitigate the risks & threats in a more transformative way.

Lesson #1: Honor the duct tape solutions, and take them seriously

Digital innovation has been disruptive for quite some time, from the dotcom era (from 1995 to the dotcom bubble burst in 2000), to physical to cyber, and now cyber to physical. Much of how we are adapting to the digital solutions are seen as duct tape approaches, such as injecting social media usage to existing sales & marketing outreach, as well as employee engagement.

Two reasons to take these duct tape approaches seriously: First, businesses use the new digital capabilities creatively. The business value we could extract from a particular technology is only limited by the appetite of an organization to try new things, and take on calculated risks. Just as there’s not only one right use for duct tape. Second, it is a misconception that these digital duct tape solutions are temporary. As technology disrupts the status quo, we can expect to strategize using these digital equivalents of duct tape as a long term approach. We should come to the realization that how we used to run our businesses is becoming the band-aid we should rip off quickly to minimize the pain.

The China-based messaging app, WeChat, served as the most popular duct tape solution testbed for personal and business use in China. Just as Mark Zuckerberg once said that “private messaging, ephemeral stories, and small groups are by far the fastest growing areas of online communication”, and messaging is at the core of Facebook’s future. WeChat is taking a similar approach. Today, WeChat is the go-to app for personal messaging, group messaging, information sharing, ride hailing, making payments, receive payments, and digital wallet. These are just a few of the digital duct tape equivalents that have proved their effectiveness.

Lesson #2: Don’t be afraid to challenge established ecosystems

This is exactly how technology such as TikTok, WeChat, and many others are disrupting the digital maturity we proudly exhibit. For example, our banking industry is an established ecosystem with very mature endpoint capabilities. Businesses are able to equip themselves to accept different means of payment, and Point of Sale (POS) support is very common. In many parts of the world, affordability to join this ecosystem continued to be a major challenge. Square disrupted this space by lowering the cost of entry and improving the end user experience. Furthermore, platforms like WeChat and Alipay disrupted the space again by providing a contactless and zero-cost endpoint support alternative, the pay by QR code option. This is by far the most impactful digital duct tape equivalent in 3rd world and developing countries. Today, WeChat and Alipay QR code payment is the default method of payment for over 1 billion users globally. This digital duct tape has earned a permanent seat at the high table.

Lesson #3: Digital Transformation has a leading role in responding to today’s business challenges

One thing we have to be very clear about is that digital transformation equals business transformation in the current landscape. What digital transformation is NOT, is to simply make changes on how your IT supports your business. Technology is an enabler, but how you apply and mobilize it to transform your business is the key. Because it takes enterprise level leadership to take the charge in shifting the culture, transform operating processes, bridge knowledge gaps, and repurpose resources. There are deliberate implications to all areas of an organization, such as procurement, legal, product development, sales & marketing, business administration, manufacturing, and etc. 

The low hanging fruits of digitization in a mature business environment are digital workers, digital influence, and turning data into action. 

Digital Workers

The concept of digital workers, via Robotic Process Automation, is a widely adopted and practical way to apply to operational challenges that are time consuming and repetitive. Robotic Process Automation solutions are not meant to replace human workers, but to enable workers to do more while eliminating human errors. The human worker still owns the business intelligence to support the delivery of the business value. Robotic Process Automation is perfect for business processes that contain tedious tasks such as data processing, user notification, task hand-off, document routing, calculations, calling APIs and etc.

Digital Influence

In today’s world, influencers do not have to spread their ideas in person. With the help of digital technology, mass outreach is immediate, targeted, and traced. Most importantly, audience feedback works the same way. This is being used heavily today, not only in businesses’ sales & marketing campaigns, but also political campaigns. 

The effectiveness is beyond the traditional media. Today’s technology enables influencer campaigners to predict personality traits, consumption habits, as well as political orientation of their target audiences. Then through a series of effort to put information in front of their audience, while the messages may be directly or indirectly related to the objective, to shape or shift the audiences’ decisions. The decisions are often perceived as your own without even realizing the influencing factors. A study of the infamous case of how Cambridge Analytica turned data from Facebook that was publicly available into political campaign tools, makes me ponder just how powerful and destructive it can be for data to be in the wrong hands. Especially for those who have possession of your private data.

While that may be a bit extreme, but a simple digital outreach to get information to your audience, and automate the feedback loop from your audience, is definitely a low hanging fruit.

Turning data into action

Many organizations today are looking for innovative ideas with different motives. Some are trying to align solutions to their digital transformation strategy, some are for making the headlines, and some are trying to improve existing Key Performance Indicators (KPI). However, a common misconception is that it has to be a new product or solution. There are so many existing products and solutions that were put in place and never executed to its full potential. In most cases, leveraging data from existing solutions is a low hanging fruit to upgrade these solutions to realize additional business value.

In a panel discussion earlier this year, I talked about exactly how this applies to the Internet of Things (IoT) solutions, and how we can turn existing Operational Technology (OT) into IoT solutions by the convergence of Information Technology (IT) and Operational Technology (OT). If we look at all IoT solutions in stages of maturity, I would have to agree with John Rossman. The four levels of IoT are

  • Level 1: tracking capabilities – this is where a single device collects data, but the value it provides is limited, and it is only available to the owner of the data.
  • Level 2: insights and adjustments – this level of IoT devices comes with sensor based analytics, and data is captured in the cloud. There may also be simple analytics and machine learning algorithms applied to the data. However, there’s no real-time adjustment, and there’s no network value where it connects & interacts with other devices.
  • Level 3: optimizations – this is where a network of devices are in play, and based on the data generated, they are making real-time and automated adjustments.
  • Level 4: network coordination – this is the ultimate goal and the most powerful state of IoT solutions. At this level, insights and actions are improved with not just one type of devices in the network, but variety of devices. In addition, the network is capable of handling entry and exit of devices to the network.

Many IoT solutions that were put in place by businesses and local government are of Level 1. As a matter of fact, many legacy operational technology solutions that are in use today can be considered as Level 1 IoT solutions. What they all have in common is the opportunity to level up to Level 2 or Level 3 by simply putting the data to work.

Lesson #4: Regulatory effort needs a sense of urgency

Digital transformation is not just about tech solutions, it should be include the full package of solutioning and operationalizing the solution with the support of necessary laws, regulations, and policies.

Today, mobile devices are tethered to users worldwide running a variety of applications, and they are generating an immense amount of data. The number of devices and data streaming agents per capita is growing by the day. The challenge is no longer who can obtain the data, but how we regulate a level playing field to embrace it, exploit the opportunities, control the risks, and stay ahead of it. When mobile phones were first widely adopted, getting information from an individual isn’t a secret weapon anymore. This also means minimal cost of entry to leverage real-time point-to-point communication. Such technology was once only accessible and affordable by businesses and military use. Technological advancement caused a shift in the society and put the power in the hands of individuals. To that extent, smart mobile devices ignited disruption in many areas. Some were not so obvious at the time, such as ride hailing services. There are risks and threats from every piece of technology, but there are also opportunities. Risk and threat mitigation is not as simple as disallowing the use of new tech. We are still dealing with phone scammers today, but we have legal and regulatory support. Most importantly, we have innovated beyond that and gained new grounds and new competitive advantages.

Conclusion

The overarching lesson to be learned is that we must get serious about digital transformation. We have to do it now, and we have to do it right. The impact on our economy and our quality of life will be substantial, and the impact is in all industries.

A stroll through Chinatown anywhere in the world will give you a taste of the Chinese culture. A few good ones will even make you feel like you are visiting China. Authentic food, sounds of the native tongue, and structures and signs resembles the culture to a tee. But it does not stop there. Paying for food and services just as they do in China is widely adopted as well. That’s right, it’s part of the culture to have a QR code in front of every cash register of every business. Customers open their WeChat app and scan the QR code to transfer funds from their WeChat wallet to the vendor’s WeChat wallet. The Chinese Yuan moved from one account to another in China, and never set foot in a foreign market, with zero recorded impact on the GDP of where the products and services were provided – and zero taxes collected!

That’s just one example of a problem created by not being in the front of digital innovation. With enough of these kinds of problems, we will find ourselves in a crisis. However, looking at it from a different angle, these are good problems to have. It means that someone is trying to do something right, a ripple effect is created. There are opportunities in every crisis. We should not panic, but instead exploit the heck out of those opportunities so that we can come out ahead of the TikTok crisis.

Jet Lu is a digital innovator, speaker and digital transformation leader. He is Director of Digital DevOps for the City of Baltimore and can be reached at jet.lu@outlook.com.