For the first time in decades, the enterprise is going through a major transformation, and according to theCUBE’s Guest of the Week, it is tough, and those businesses that don’t get evolve with technology and go digital will be left behind.

Joe Weinman, digital strategist and author of Cloudonomics: The Business Value of Cloud Computing, stopped by theCUBE, from the SiliconANGLE Media team, during OpenStack Days: Silicon Valley 2016. He joined John Furrier (@furrier) and Lisa Martin (@Luccazara), cohosts of theCUBE, to discuss how digital transformation is impacting literally every business on the planet and the risk of falling behind.

Rushing to the cloud

Furrier introduced Weinman on the show as a VIP influencer in tech, business luminary, patent holder and author. Looking to his authority on cloud computing economics and the business value of the cloud, Furrier asked Weinman for his take on the industry today. Weinman has a very Darwinistic approach.

“If you go back a few years ago, everyone was talking about how cloud is a cost optimization approach, and we can save a few shekels basically by doing cloud. Then people started to realize there’s more to it than that; there’s an agility angle.

“What I’ve been arguing, probably for six or seven years now, is don’t look at the cost side; don’t look at performance metrics. Look at the fact that the world is going digital. If you’re not competing as a digital business, no matter what business you were in, you are going to miss out and ultimately the spoils will go to those with the digital skills and capabilities to incorporate in their products and services.”

Digital is an end-to-end process

When talking about digital, Furrier pointed out that it has different meanings to different people. Referring to Weinman’s book, he wonders if the author looks at it from a business process perspective. Weinman described the different end-to-end processes he reveals in his book.

“I look at it several different ways, and in Digital Disciplines [Digital Disciplines: Attaining Market Leadership via the Cloud, Big Data, Social, Mobile, and the Internet of Things] … the new book, this is what I cover. It’s the idea that processes and resource optimization certainly has gone digital. Products have definitely gone digital, and digital products have been around for a long time. You had the digital watches 30–40 years ago, but now they’re not just smart and digital, but they are connected to the cloud in ecosystems in developer communities. So the whole nature of not just the products themselves, but services, which leverage the Internet of Things (IoT) … let’s say connected healthcare with connected pacemakers, connected diagnostic machines, connected pills even.

“Customer relationships have gone digital, so a Netflix recommender, an Amazon upsell/cross-sell, but also a Mayo clinic that does personalized or patient specific therapies, based on a massive amount of Big Data and a targeted recommendation engine that leverages all that.

“The last thing that I cover is actually the innovation process, where that’s gone digital. Whether you look at 3D printers, cloud-mediated contest and challenges, innovation networks, or idea markets, I just don’t get companies that say, ‘We don’t need to worry about that, that’s something for our tech people.’ There are no tech people versus the core business; they are one and the same, and you’ve got to realize that.”

Business value vs. customer value

Martin asked Weinman what recommendation he would offer the chief information officer collaborating with the business side. “What is that dynamic that the C-suite and the CEO of the business … need to have to facilitate that customer-first focus?” she inquired. Weinman described the dimensions of what customer value is.

“If you want to compete effectively, as a rule, you’ve got to deliver differentiated customer values [for] the customer to select you. There are other dimensions to competitive strategy, like maybe having a cost advantage that allows you to ‘weather’ the price wars better.

“The other thing is that people focus on the customer experience, but there’s a lot more to the total customer value package than just the experience. You’ve got to have this co-creation of strategy effort that says, ‘We are trying to figure out something that will really be unique and help us create differentiated advantage and therefore help us create margin and market cap and allow us the flexibility to continue to innovate. All that has to be grounded in the reality of technology.”

Laying out the chess board

In closing the interview, Furrier used the analogy of knowing what checkmate looks like in order to play chess to showing the CEO the roadmap for technology. Weinman could not provide an easy solution.

“The challenge for all companies operating in this period of transformation of the entire industry is, ‘This is tough.’ This is like Carthage when the Romans came in or something. You have these empires that have existed for a long time, and it’s really hard for them to change.

“Telcos, for example, were doing this stuff back in the early ’90s. You had easy World Wide Web, and now I think AWS and Google and Microsoft and IBM are viewed as a little bit more capable on the field. So you say that you have the natural capabilities, competencies, infrastructure, customer relationships, [and] the cloud is a network-centric service. You have no cloud without a network, so that’s a natural. You also have the legacy hardware vendors who are giving it a college try, but you’re just undergoing the shift to open compute and OpenStack, and it’s tough.”

Watch the complete video interview below, and be sure to check out more of SiliconANGLE and theCUBE’s coverage of the OpenStack Days: Silicon Valley 2016.

Photo by SiliconANGLE