HOW LYTICA BECAME A UNIQUE ANALYTICS COMPANY • PART 3

Part 3: Why an ATC?

Where do new ideas come from? How can we know which ones will change the world?

Ideas come from thoughts that seem to materialize in the mind out of nothing. If they pass some internal filtering thresholds, they may be expressed. Some thoughts are good ideas such that their creator gets behind them, and fights for their survival, while others dwindle into obscurity. Once an idea leaves the creators mind, the term “dwindle into obscurity” can often be replaced by the words “are killed”. Disruptive thinking, really anything that upsets the status quo, will be attacked much like white blood cells attack and try to kill a virus infecting your body. There is a greater tendency to reject change than to embrace it. The risks associated with an idea are often seen as more real than the opportunities.

The degree of resistance to an idea will be proportional to the amount of change it represents. Disruptive ideas need a champion to let them see the light of day, as well as an environment where they can grow enough to have a fighting chance. Lytica needs an environment that lets more ideas escape from our employees’ brains and allows nurturing before the onslaught of necessary critical examination.

A perfect example of a disruptive idea meeting resistance in the industry is artificial intelligence (AI).

A survey by Forrester looking at obstacles to AI adoptions, as expressed by companies with no plans of investing in AI, demonstrates this. Reasons companies give for not embracing AI include: There is no defined business case (42%); not clear what AI can be used for (39%); don’t have the required skills (33%); need first to invest in modernizing data management platform (29%), and don’t have the budget (23%). I hope none of these companies are in my stock portfolio, as these all signal an excuse approach to management that is out of touch with today’s faster, better, and cheaper environment.

I recognize that many of my customers are in a quandary because they feel they should be getting engaged with AI, but don’t know where to start. Forrester also reveals that many of the companies surveyed are not certain what is needed for implementing an AI system (19%), feel that AI systems are not proven (14%), and think they lack the right processes or governance (13%).

At Lytica, we are familiar with resistance to new ideas. When I first thought of building an application that later became Freebenchmarking.com, I thought it was interesting and potentially game changing. When I told my idea to those around me, there was either little interest or the assimilation of a long list of reasons why it wouldn’t work. Rather than receiving encouragement like “this will save customers millions of dollars!” or “a database like that is unique and has so much potential for mining new insights about the components”! I got a long list of why it was not a good idea.

Here are just five of them:

  • How are you going to get enough data to see if the idea works?
  • There are too many variables in pricing, your idea won’t work!
  • Companies are not going to share such private data with you.
  • Why would any company want to try such an idea?
  • You’re not a software guy, how are you going to get a prototype developed?

The actual list was much longer, including other things like budget and core competency.

In defence of those around me, they were asking very important and valuable questions and I wasn’t expressing my idea well. But everything that Lytica is and has today — the value it enables for its customers, the jobs it creates for its employees, everything — is because of this idea that I wouldn’t let die.

I believe I can make the more general statement that every company operating today and all of the benefits derived from them owe their existence to an idea and someone who wouldn’t let go of that idea.

In the industrial revolution, and the electrical age following, most companies were vertically integrated; that is, they made everything in their products from raw materials that they procured directly from the source. These companies also had distinctive R&D labs where technology was researched, and products developed. Bell labs, the Watson Research Center, the Sarnoff Research Center, and others were established for this purpose but most have now disappeared.

I see technology as a critical underlay to solving chronic supply base problems that have been brought on by horizontal integration. When companies moved from vertical integration (production of all materials involved in manufacturing) to horizontal integration (our current system of multiple vendors in the component supply chain) transparency was lost to costs, security of supply, and compliance.

With vertical integration you knew your costs, directly controlled your risks, and could make sure you followed the rules. Horizontal integration requires that you trust what you are told with limited and often unsatisfactory ways to verify. Lytica solved the transparency problem with cost, at the component level, and now has unique information to help solve the transparency problems for security of supply and compliance.

Lytica is building an Advanced Technology Centre (ATC) to create a better customer experience by creating fertile ground for new ideas — both yours and mine. I think about the customer experience using a model with three levels: the customer level, the product level, and the technology level. Customers gain value at their level by getting answers in real time to questions that prevent optimal supply base performance. These answers are delivered through products at the product level that are based on and fed with information created at the technology level. Enhancing the customer experience means simplifying access to better information with no time delays. Immediate, actionable, answers are at their fingertips. That’s the goal, and to do it I need focused research and development using traditional and artificial intelligence in an environment that supports free thinking and experimentation, yet maintains tight linkage with customers. I am building an ATC to create a better customer experience so I can grow my business and yours.

Ken Bradley is the Chairman/CTO & founder of Lytica Inc., a provider of supply chain analytics tools and Silecta Inc., a SCM Operations consultancy.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: