Center Helps Businesses ‘Reboot’ in Digital Age


By Kathryn Bold

Being able to anticipate future trends can make or break a business. Trouble is, no one has a crystal ball to say what will be the next Uber and what will flop like, well, a floppy disk.

That’s where The Paul Merage School of Business’s Center for Digital Transformation comes in. It teaches students and executives how to successfully navigate changes in the global business environment driven by rapidly advancing digital technologies.

“You have to understand what the digital revolution does to your business,” says center director Vijay Gurbaxani. “You have the new that threatens the old. Our goal is to help companies undergo this transformation.”

In a recent report for the center, “Time for a Reboot,” he cites examples of established businesses that choked when new digital offerings cut demand for their products. Among the “digital roadkill”: Blockbuster (from 9,000 video rental stores in 2004 to bust in 2010), Eastman Kodak (the 131-year-old film pioneer went bankrupt in 2012) and Borders (the bookseller was “Amazoned out of existence”).

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Even smart technology enterprises can find themselves playing catch-up to competitors if they don’t jump on emerging trends fast enough, Gurbaxani says.

“One example is Microsoft – it took quite a while for the company to move into the cloud,” he says, referring to the network of remote servers that allows users to store, process and manage data over the Internet instead of on their local server or personal computer.

Microsoft has lagged behind market leader Amazon, which got a head start in the cloud competition and now dominates the industry.

Another example cited by Gurbaxani: self-driving cars. Traditional auto makers have been slow to pursue the new technology, leaving the road wide open for an industry outsider such as Google to take the lead.

“You have to understand what the digital revolution does to your business.”

“Google is already testing prototypes of an entirely self-driving car, while car manufacturers are adding driverless components in small increments, like the self-parking feature or lane-change assist,” Gurbaxani says. “They see driver-assisted cars as a threat because they have a lot invested in cars that people drive.”

The businesses most likely to flourish in the future are those that will find a way to match an unmet demand with new technology, he says. That includes companies like Uber.

In just five years, Uber has become a multibillion-dollar enterprise because it offers a faster, cheaper, more convenient alternative to taxi and traditional car services, Gurbaxani says. Anyone wanting a ride from point A to point B can get a lift by using a cellphone app. Recent protests in France by taxi drivers whose livelihood is threatened by Uber illustrate how businesses that don’t evolve can find themselves stuck in idle.

And that’s not all. Uber is expanding to encompass grocery and food delivery, Gurbaxani says “What’s even more impressive is that Uber is investing heavily in self-driving cars,” he notes. “When was the last time we saw a 5-year-old company invest in disrupting itself? But that’s how fast the world is changing, and many companies don’t have the luxury of waiting anymore.”

To encourage executives to embrace digital technologies, the UCI center offers peer-to-peer forums, support for research, conferences and educational programs.

"To encourage executives to embrace digital technologies, the UCI center offers peer-to-peer forums, support for research, conferences and educational programs."

“We draw in faculty members from different disciplines, primarily from The Paul Merage School of Business and the Donald Bren School of Information & Computer Sciences, to share their knowledge” with the community, Gurbaxani says.

As he told the Business Transformation Academy, an interdisciplinary global think tank, the move to a new digital economy “is very challenging and fraught with risk.”

He added: “Businesses with better strategic foresight of where the digital world is heading and businesses that are able to leverage this understanding to adapt to a changing environment will be more successful.”