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Satya Nadella: Why businesses should embrace digital transformation, not only to survive – but also to thrive

Helping society move forward is deeply grounded in Microsoft’s mission of empowering every person and every organization on the planet to achieve more. For business that means a digital transformation, Microsoft CEO Satya Nadella said Monday in his keynote address at Microsoft Envision in New Orleans.

The kinds of innovations Microsoft is talking about are disruptive. For businesses to survive and thrive in this new era, they must embrace digital transformation.

Companies succeeding at digital transformation are doing four things, Nadella said: Becoming more engaged with their customers, empowering their employees, optimizing how they run their business operations and transforming the products and services they offer using digital content.

The dimensions aren’t new, but what has changed is the role that systems of intelligence now play, providing better insight from data and converting that into intelligent action, he said.

Becoming more engaged with customers includes predicting what customers want before they know they want it, based on data intelligence, and offering it to customers in a way that’s natural, like having a conversation with a representative from a company, he said.

That’s why human language will be the next new interface, Nadella said.

“This is a world that we’re at the very beginning stages of, but we think it is going to be much more ubiquitous in terms of its deployment,” he said. “Think of all the people who use SMS today, and imagine that medium becoming much, much richer.”

Empowering employees is another pillar of the digital transformation. For example, it’s serendipity at work when you discover someone else is producing something you need, or you find someone who has the solution to a problem that stumps you.

You don’t need to rely on seredipity to get that result.  All that knowledge and insight exists inside your infrastructure – in your email, your documents, your line of business applications – it’s just waiting to be found using organizational analytics to discover information across an organization, and provide insight to what is going on, he said.

The third pillar of digital transformation, optimizing your business operations, means that it’s not enough to know what’s happening now in your business – you have to anticipate what will happen, then be prepared to capitalize on that insight, he said.

Machine learning and the Internet of Things can help. These tools use millions of data points from processes and sensors to recognize patterns and generate predictive insights, Nadella said.

Finally, transforming the products and services companies offer is happening because of data intelligence. All companies everywhere are becoming data companies – from farming to finance, from New York to New Delhi – businesses are using data to connect everything from cars to cows.

“We as business leaders don’t work in isolation. We live in a multi-constituent world,” Nadella said. “Our long-term ability to grow is directly related to our ability to make our climate more sustainable, our economies more viable, and that only happens if we ask ourselves what difference is our business making, what difference are we making?”