Technology is driving the production and provision of services and products closer to the moment of demand.
Robert Wolcott, Northwestern University professor of innovation and entrepreneurship and author of the book Grow From Within: Mastering Corporate Entrepreneurship and Innovation, explained to TechRepublic's Teena Maddox the critical dynamic of "proximity."
Wolcott: Here at Alltech ONE, I'll be talking about how technology is driving the production and provision of products and services ever closer to the moment of demand. This is true across industries. This is a dynamic we'll see for the rest of our careers and perhaps beyond. It's something we call proximity.
The reason we call it proximity is, each individual consumer, business, point-of-need in time-and-space is going to be tracked, and served closer to that moment where demand might be required.
Why is this? Because when we can do that, when we can produce and provide closer to the moment of demand, we overall increase the efficiency within the economy.
Now, this might sound counterintuitive, because traditionally we felt that in order to drive efficiency we had to drive scale, which meant locating plants, locating production further and further, often from actual demand, scaling up production, and therefore bringing down costs. But as technology allows us to put sensing, analytics, access to data, agency, the ability to make decisions, or even the production of goods, such as 3D printing or rooftop solar energy generation, for instance, ever closer to each individual consumer, each business, we'll actually be able to drive this notion of proximity.
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The reality is, there is no one technology that's going to be driving this transformation of various industries. There is a whole range of technologies. Each of these technologies we see today — whether it's Internet of Things, or data analytics, block chain, roof-top solar-energy generation, 3D printing — we can go through the whole list, each of these technologies allows us to get closer and closer to each moment of potential demand, so what you might desire at a particular point in time, before perhaps you even know you desire it. Or, before you've made the decision to reach out, a company might already know you have a need on the horizon.
I'll give you an example of this. Amazon, a wonderful and creepy company at the same time, has the ability to do what they call anticipatory shipping. What they're doing with anticipatory shipping is, they're watching your online behavior. What are you clicking on? What are you searching for? Where are you spending your time? There's something called "cursor-hover time." We call it "digital drooling." This is where someone goes back to that fishing rod that their wife told them not to buy, and they keep clicking on it, and they keep hovering over it. Amazon sees this. So, therefore, Amazon sends that fishing rod to the distribution center near that individual consumer before he's ordered the product.
Now, what I'm not saying is they have better demand planning, and they send 144 fishing rods to the distro center in his town. Instead, I'm say they send that specific fishing rod closer to his home before he's actually ordered the product. By the way, they've been doing this for almost three years. Do you think they're getting better?
The reason we know proximity is happening and will happen is that consumers want what they want when they want it, and where they want it. By the way, they also want it for free, but we can't do much with that. Anyone who can give individuals what they want, where they want, and when they want it, ultimately, is going to win. So, we all have to figure out how to do this.