Just about every industry sector is now being impacted, threatened, destroyed or modified by the digital revolution.

John Sheridan, CEO Digital Business insights.

A lot of people are in shock. Many refuse to accept that what is happening is real. They sincerely believe that things will return to the way they were, even if it takes a little while.

They won't.

Many others are shutting their eyes to what is happening. They don't see the connection between the bad times and technology at all. They blame other things.

They are wrong.

Others put lipstick on the pig. They acknowledge that something is happening. They don't understand it. But they take advice from the consultants and social media experts (who aren't) and carry on business as usual with digital paint on.

It won't work.

Some lucky industries (a few only) are out of the flood. But even they need to understand what is flooding past their door. The water will continue to rise.

But most industry sectors are in the heart of the digital flood of more connection, more collaboration and more integration.

The three primary currents of change don't sound like much, but the result of those three forces is disrupting the whole world.

Each succeeding current depends on the one before it. Connection is the primary current of change that shifted power from vendors to customers, that provided the platform for Google to dominate information finding and began the process of undermining what used to be.

It is responsible for the destruction of the advertising base of the media industry that has toppled the newspaper empires to the ground. They think they have it under control.

They don't.

They think they can get people to pay for content.

They won't.

The CEOs of the major media still don't get it. They put lipstick on a pig.

It is not enough to add digital to what was, the business model has to change. That has to start with a real appreciation of the shift of power.

New digital business models will only work if they are built from the customer up. Start with the customer and deliver.

Newspapers are a good example of what not to do.

Itunes is the perfect example of what to do in the new digital age.

The control of content was removed from the publisher completely and put into the hands of the customer to do what they chose.

And the process was made easy. Perfect.

The customer could select the tunes that they wanted and construct a new publication = my music. Apple realised clearly that the customer was in control and willing to pay to be in that position.

The publisher did not have a role any more in deciding the content of the album or the compilation. The customer is king.

The same thing applies to every other sector that is disrupted and threatened.

The key to understanding the exit strategy (the way out of the flood) is understanding the new customers and what they want.

Now, for Fairfax and News to continue to publish content under their mastheads and editorial control is old world not new world.

And to think that customers will continue to pay for this for years to come is wishful thinking.

Some will. Some always will. But not enough to replace the rivers of gold. And not enough to be sustainable.

Look what Apple did. They weren't into music. Then they were. Suddenly and successfully.

The principles apply to every sector. Who will come suddenly and successfully into your domain?

What does the customer want?

Ask them. Start there. And listen. If they tell you they want something, give it to them or somebody else will.

And like Apple they will come from left field or right field, not from where you expect or where you are looking.

Collaboration is the next current of change that will sweep us all along.

It is beginning to have an impact. It needed connection to happen ubiquitously. Now it has. And the tools of collaboration are being used and being newly built for us all to use.

And collaboration is even more threatening to those organisations that have only put lipstick on the pig. Because that is where the power of comparison and sharing and advising will undermine anything that isn't real.

Lipstick on the pig isn't real. It is just adding digital clothing to a business model that is still unchanged.

It won't work.

Now big organisations take time to fail, fall and drown, so they might even believe that they are on top of this, and I have spoken to many that do.

They aren't.

Revolutions overthrow the old but also build and create the new.

The process of digital change is accelerating in an uncomfortable way.

All opportunities at this time begin and end with the customer. Talk to them. Listen to them. They have all the information you need. And all the answers. But do it yourself. Don't let somebody else do it for you.

Ask your customers what has changed. Ask them what their problems are. Ask them what they would like from you. Give it to them.

The new tools of the digital revolution provide the means to create new solutions of many kinds.

Integration is the last current of change and that is even more threatening to the old order, because it joins things up.

It joins up those who want to be joined and it automates relationships delivering even more value than before. And when it is done in a way that satisfies the interests of all involved = shared value, it locks other things out.

It is still a little way off, but it is coming.

We haven't seen anything yet.

- John Sheridan, June 2013

www.db-insights.com

* John Sheridan is CEO of Digital Business insights, an organisation based in Brisbane, Australia, which focuses on helping organisations and communities adapt to, and flourish in, the new digital world. He is the author of Connecting the Dots and getting more out of the digital revolution. Digital Business insights has been researching and analysing the digital revolution for more than 12 years and has surveyed more than 50,000 businesses, conducting in-depth case study analysis on more than 350 organisations and digital entrepreneurs.

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APPLICATIONS have been called for organisations to deliver Digital Enterprise training to businesses in the Gosford (NSW), Gold Coast (Qld), and Wollongong (NSW) regions.

Cloud computing comes to SMEs.

The Digital Enterprise program is funded through the Federal Government and aims to assist business to learn about the opportunities available to them though the digital economy.

Minister for Broadband, Communications and the Digital Economy, Senator Stephen Conroy, called for applications through this fourth round of the Digital Enterprise program. He said Gosford, Gold Coast and Wollongong were the three largest communities where NBN construction has commenced that are yet to receive funding as part of the Digital Enterprise program.

The Digital Enterprise program offers free expert training for local businesses and not-for-profit organisations to adapt to the online world and gain a better understanding of the many opportunities provided through the National Broadband Network (NBN).

The selected organisations will be awarded grants worth up to $280,000.

“It’s so important that small businesses get online and start thinking about how they can make the NBN work for them,” Senator Conroy said.

“We are already seeing how the Digital Enterprise program is helping small businesses take full advantage of the benefits that come from embracing the digital economy.

“For example, WorkForce Blueprint in Willunga, South Australia, has used the program’s training to improve their online business strategy. Now their entire business, including email, documents and finance software lives in the cloud, meaning their employees can work from anywhere, anytime that suits.

“Another small business established in 2011, Didgeridoo Dojo, participated in the training program and delivers online didgeridoo lessons to 7,500 customers, with a 1000 hours of lessons being viewed each month.

“Many other businesses are also taking advantage of the free training that is being offered. Across Australia, there have been more than 4,800 participants in the Digital Enterprise program.

“I urge local organisations from Gosford, the Gold Coast, and Wollongong, to apply for funding to deliver this important program.”

The Digital Enterprise program is currently operating in 44 communities around Australia. These communities are some of the first in the country to access the benefits of the NBN, Sen. Conroy said.

The closing date for round four applications is 2pm on April 29, 2013. Digital Enterprise Round Four Program Guidelines are available at: www.dbcde.gov.au/digitalenterprise

THE THEFT of trade secrets, business proprietary data, intellectual property and customer information is on the rise in Australia according to research by BAE Systems Detica.

Vodafone McLaren Mercedes Formula 1 team is a BAE Systems Detica client, protecting its IP.

The company's director of its Strategy and Major Client Group division, David Owen, warned "sophisticated attack groups with the motivation and capability to use techniques well beyond mainstream malware" are increasingly targeting businesses through their supply chains. However, he said, there were clear strategies businesses of all shapes and sizes could employ to help protect themselves and it was vital Australian businesses developed a culture of cyber security awareness.

Mr Owen said cyber criminals were constantly finding new ways to steal an organisation's valuable information.

He has seen this trend build in recent years. Before joining BAE Systems Detica, Mr Owen led Deloittes' security management competency team in Australia and has had previous experience with BAE Systems in the UK where he worked in information security for joint venture company MBDA Missile Systems.

"The company's supply chain is often the weakest link and the easiest place to find that information because many of those organisations are not actively looking for evidence of compromise," Mr Owen said.

"BAE Systems Detica has seen a marked increase in attacks on supply chain targets such as professional services companies, legal firms, IT outsourcers, marketing agencies or other third party advisors and companies.

"The main targets have increased their defences so attackers a looking for another route in. Hackers can easily get into an organisation through the third parties a company works with."

According to research by BAE, the factors that have led to the increase in targeted attacks of supply chains include:

• growing resources and sophistication of attack groups
• increase of blended attacks
• low risk of getting caught for attackers
• increasing difficulty to detect threats and attacks
• challenge of identifying the specific behaviour patterns of sophisticated attacks
• lack of resources in the Australian industry to perform sophisticated analysis, follow-up investigation and response/clean-up.

 
BAE Systems Detica has created a list of suggested best practices to protect supply chains:

1.        Prepare
It is important to understand your so-called trophy information (information that is highly desirable to hackers and corporate thieves), cyber risk, compliance environment and internal cyber capability. These are the first things to assess in any cyber security plan. Based on this knowledge, you can develop strategies and tactics that will help address cyber risks based on priorities. It will also pinpoint whether you need to develop your workforce to become more cyber aware and what additional skill sets might be required. Publish your business rules for cyber security and create awareness of these among your employees and those of your supply chain.

2.        Monitor
Businesses should continually monitor systems and networks for signs of malicious activity, but also keep track of changing business requirements, emerging trends and the external environment they operate in. Make sure you measure the effectiveness of cyber security (technical and non-technical capabilities) as this will help you stay on track.

3.        Protect
It is imperative to design and deploy cyber security solutions that will address risks and enable the business to operate with confidentiality and integrity. However, these solutions need to be carefully developed so they don't cripple your systems by being too secure. Apply sound engineering processes to the selection, development and deployment of cyber capabilities so that they integrate well with your business operations.

4.        Respond
Having response plans in place sounds like a given, but this is often overlooked by businesses. Understand your capability to contain and recover from cyber incidents and make sure you learn from previous ones and that the appropriate feedback is given in order to prepare processes.

5.        The human factor
Companies place a lot of importance on technology when it comes to cyber security it is important not to overlook the human factor. Do employees understand the sensitivity of the data they have access to and the implications if there is a security breach? Getting employees to care about security and understand that they have an important role to play in keeping the organisation's cyber security risk to a minimum is key.

Mr Owen said, "Without the human element, the technological controls are useless. Creating a culture of security is imperative. Companies must always consider the suppliers' security measures to ensure they align with theirs."

BAE Systems Detica's business delivers information intelligence solutions to government and commercial customers and develops solutions to strengthen national security and resilience. Detica is part of BAE Systems, a global defence, aerospace and security company with about 90,000 employees worldwide.
BAE Systems also delivers a wide range of products and services for air, land and naval forces, as well as advanced electronics, security, information technology solutions and customer support services.

One of BAE Systems Detica's high profile clients is McLaren Group, which includes Vodafone McLaren Mercedes, a world leading Formula 1 team. The group has rich and varied intellectual property (IP) that is vital to maintaining competitive advantage and warrants advanced protection. The groups uses Detica CyberReveal to protect the team's IP - including its advanced automotive technology - as well as its partner and commercial information against sophisticated targeted attacks on its information systems and networks.

www.baesystems.com

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