Hailey Cho

First, they must determine to what extent they are part of a value chain that can be controlled (and that they believe they or someone must control), or to what extent they are part of a more complex digital ecosystem, in which the dynamics are less about command and control and more about building, maintain- ing, and using networks.

Second, executives need to assess how much they know about the needs of their end customers and how much they can know. Once a company has determined which quadrant or quadrants it is operating in, it can use the framework to discover whether it should stay where it is or, if not, what it should do to move toward another DBM.

Because almost every enterprise can use these digital technologies, they don’t necessarily offer a competitive ad- vantage. The key is differentiating your business by offering cus- tomers something new and compelling, enabled by the vehicle that digital offers, and creating a destination customers want to visit.

We call this process creating the next-generation enterprise.

First, they are moving from controlled value chains (à la Michael Porter circa 1980) to more-complex, net- worked systems.8 Second, they are moving from less familiarity with customer needs and life events to a better, closer understand- ing of them, resulting in better customer engagement.

1. Supplier: producer that sells through other enterprises
2. Omnichannel: integrated value chain that creates multi- product, multichannel customer experiences to address life events
3. Modular producer: provider of plug-and-play products or services
4. Ecosystemdriver: organizerofanecosystem,acoordinated network of enterprises, devices, and customers to create value for all participants, which is the destination in a particular domain (such as shopping), ensuring great customer service; includes complementary and sometimes competitor products

Looking at these dimensions in combination results in a two-by-two frame- work (the DBM framework) consisting of four distinct business models, each within a quadrant representing different capabilities and varying average financial performance (figure I-1).

How do they join the ranks of digitization to take advantage of customer relationships and increase cross-selling opportunities, among other benefits? How do leaders create a compelling vision for their enterprises’ success five, even ten, years from now?

Enterprises that are successful in one industry (or customer domain) use digital tactics to move into a new industry or domain. We are seeing this trend in many areas like home ownership—with banks, insurance companies, realtors, and others all vying for this space.

In the digital economy that’s now upon us, many enterprises won’t succeed by merely tweaking the management practices that led to past success.

To thrive in a digi- tized universe, businesses of all sizes will need to reinvent them- selves and substantially change their organizations, including their business models, people, structures, critical competencies, and cultures. In short, your relationship with your customers de- pends on creating new digital ways for them to interact with your company.

E.g (To be sure, the digital revolution is disrupting virtually every industry. In financial services, for example, customers are pulling away from long-established relationships with banks in favor of third-party apps and experiences offered by the likes of PayPal, Apple Pay, Kabbage, and Venmo.)

Digital transformation is not about technology—it’s about change. And it is not a matter of if, but a question of when and how.

In this book, we introduce a simple but powerful digital business model framework and language to help executives think about their competitive environments in the digital era. The framework will enable leaders to understand where they are in their digital journey, where they have to go, and which best practices will get them there. We derived the framework and material for this book by studying top financial performers and drawing on five years of field-based research, executive education, meeting and workshop facilitation, and advising. Moreover, we have studied fifty compa- nies with in-person interviews and more than a thousand compa- nies through survey data collected over six surveys.

An NFT is a unique cryptocurrency token that can take the form of pretty much anything digital — art, a GIF, or even Twitter CEO Jack Dorsey’s first tweet. (For a more detailed look at what an NFT actually is, check out this breakdown.) There have been some initial estimates of how much power an NFT uses up and, consequently, how much planet-heating pollution that generates.

That website used to let people click through the estimated greenhouse gas emissions associated with individual NFTs until creator Memo Akten took it down on March 12th. Akten, a digital artist, had analyzed 18,000 NFTs and found that the average NFT has a carbon footprint somewhat lower than Space Cat’s but still equivalent to more than a month’s worth of electricity for a person living in the EU. 

But here’s why there’s probably a hell of a lot of greenhouse gas emissions tied to NFTs: they’re largely bought and sold in marketplaces like Nifty Gateway and SuperRare that use the cryptocurrency Ethereum. Ethereum, like most major cryptocurrencies, is built on a system called “proof of work” that is incredibly energy hungry. There’s a fee associated with making a transaction on Ethereum — and, ironically, that fee is called “gas.”