Most Australian companies have left their decision to go digital too late, warns IBM ANZ’s Managing Director Andrew Stevens.

They need to move now, or risk getting left behind.

Stevens was speaking at an ACS Foundation lunch in Sydney, His topic was ‘digital decision points’. He was standing in for advertised speaker, well know market analyst Phil Ruthven, who suffered a heart attack the day before the event.

“What do I mean by digital business transformation,: asked Stevens. “It is the tectonic shift brought about by new technologies that affect every business, industry sector and government.

“These trends are going to re-shape your business models. They might even make those business models obsolete. Digital transformation will encourage you to collaborate more closely with your customers on every facet of your business, or even to create new products and services, and find value in unexpected places.”

Stevens said digital transformation will cause companies to blend all their sales channels into a continuum to provide a seamless customer experience. Digital transformation will affect your employees, business partners and all your customers.

“Increasingly, broadband will be backed by smart systems able to learn for themselves and analytics, and big data. It’s a utility the likes of which the world has never seen and it will transform everything you do, make and sell.”

Stevens offered a few proof points. Nearly 6% of Australian retail sales are now online, according to the NAB Online Retail Sales Index. “That’s about $12.8 billion – a growth rate outstripping bricks-and-mortar shops by nearly eight to one. And three-quarters of those shopping dollars were spent domestically.

“Mobile commerce is also exploding. In June last year, ACMA estimated that 4.5 million apps were downloaded in that month. In that same quarter, 2 million Australians went online at a Wi-Fi hotspot.

“Here’s another sobering thought – Ericsson estimates that worldwide mobile data traffic was 700 Petabytes a month in the first quarter of last year. That’s more than ten times the figure of the year before. If you took all the written works since the dawn of recorded history it would be just a little more than 7% of the data mobile users send in one month.

“Over the past year, Telstra and Optus have turned on powerful 4G LTE mobile networks. We have the NBN coming. That really will add enormous capacity to our telecommunications system. There are other smaller innovations coming through, such as the digital wallet.”

“You can see where this type of technology is headed. You likely have some idea of how this could be deployed in your own businesses. Already, you don’t need cash in your wallet. Soon, you won’t even need plastic – everything will all be on your phone.

“Most of you will be familiar with the phrase carpe diem, meaning ‘seize the day’. I’d encourage you to do just that. Seize this day because, whether you know it or not, your business is at a digital decision point. This is the year to harness new digital ways to do business and to reconnect with partners and customers.

“The businesses that do line themselves up correctly over the next year or so will be positioned to speed out of the corner as we move towards 2015. Even that timeframe is generous. I don’t want to overstate the challenge or the speed with which we all have to overcome it.

“Although the run up is a bit longer for certain sectors, everyone must decide now or else, when the blow torch is applied in 2018, it will be too late.”

Stevens said that sectors that will most benefit from transforming their business models are professional services, healthcare and education. Transport, administration services, mining or utilities will come later.

“How each of us reacts in our business will determine Australia’s long-term prosperity and competitiveness. The problem with any long-term view is the horizon appears too far away to matter.

“Day-to-day priorities – simply ‘keeping the lights on’ – often take precedence. But I hope you can see what a mistake that would be.

“Look around your business, and that of your partners. Survey your customers. How can you improve or innovate? What must you do start a process of digital transformation in your business? Could you change how you sell? Can what you sell be digitised?

“Then start – or continue – the serious business reinvention and technology work. Perhaps the first step is to shift key processes to the cloud. Maybe it’s enabling those millions of smart devices in your employees’ hands to access work resources.

“There’s data in your business, but do you know how to capture, store, secure and exploit it for competitive advantage? This isn’t a question of technology, because everything you need is already available.

“It’s a question of leadership, and the vision and commitment to pull it all together,” said Stevens.