Digital transformation and new digital business are talked up as top priorities by today’s business leaders. It’s something to facilitate, drive and review systematically. Yet many large companies fail to reap the full benefits of their digital agenda. Often the problem is a lack of clear vision, scant progress or inadequate impact, resulting overall discontent and frustration by the top management.
Thanks to our extensive experience in this area, we have a fairly clear idea of what a successful digital agenda looks like and how to ensure its execution to create tangible business value and delightful customer experiences.
It’s a constant challenge. New digital technologies emerge fast and revolutionize industries. Consumer behavior and values keep changing. Old truths no longer hold. Digitally savvy competitors – be they small startups or dominant global corporations – keep emerging, making competition more intense and global. Any business strategy, no matter how carefully formulated, can become outdated in a matter of only weeks or months. Or overnight, if a global digital giant like Facebook, Amazon or Google decides to enter your market or segment.
Leaders often feel their own companies are unable to respond to the challenges posed by the new market environments. They feel their organizations are too slow; too rigid and stiff; not innovative enough; lacking the right digital mindset or culture; and frequently lacking the digital talent necessary to thrive. Various digital strategies, digital transformation agendas, innovation programs and digital business creation plans are created and executed, but the results are not always good. On the one hand, crafting a digital agenda that is comprehensive enough to make all the changes needed and covers more than a handful of digital concept development initiatives isn’t easy. On the other hand, successfully executing the agenda to deliver tangible business value is hard, too, because success in execution is a sum of many interdependent factors within the organization.
It’s a constant source of disappointment.
Since 2000, we’ve worked with many large corporations to co-create their digital future. Companies can sometimes be limited in their thinking, unable to see all the opportunities and challenges that digitalization presents. A proper digital agenda is much more than “a new mobile app”, “a platform”, “a development team” or “an IT-project”. The execution of a successful digital agenda starts with a mindset shift in the company’s management, because a proper digital agenda has broad implications for almost all key functions - not just in small project organizations or in IT.
What goes into crafting a winning digital agenda? One that adds value to the business and ensures the long-term success?
What is the digitalization vision, what business purposes the agenda serves, what does the company hope to achieve with digital? The answer lies in linking digital activities to the company’s business objectives:
Digital initiatives often serve multiple purposes: new digital products or services help companies not only re-position themselves in the marketplace, but generate more revenues and improve overall competitiveness, too. Digital service channels may not only reduce the costs of manual customer service work, but also provide fundamentally better customer experiences or better capital use. A proper digital agenda often caters to various purposes and produces a variety of complementary business benefits.
It’s important to understand the word “transformation” in broad terms. Sometimes digital transformation is an improvement of a market position within a familiar industry, e.g. from laggard to a leader. But digital transformation can also mean a shift towards a completely new industry, e.g. from news publishing to technology or data provision; from financial services to housing or automobile business; and so on. A key ingredient of a proper digital agenda is exploration of new opportunities and competitors inside and outside the given industry.
After clarifying why you need a digital agenda, you need to understand what core activities and value chains can be improved through digital tools and new ways of working. This boils down to the WHAT question: what actions does the company need to take to fully benefit from digitalization in its business operations and functions? To answer the “what” question thoroughly, the following perspectives must be considered:
While all the above-mentioned activities on the digital agenda are important and complementary, they are not necessarily equally important in all firms and shouldn’t be tackled simultaneously. For example, companies that already have a handle on digital marketing may want focus on R&D to boost their digital competitiveness. Some companies may wish to work on customer-facing things this spring and turn their attention to technologies and ecosystems in the autumn. A talented business leader knows how to prioritize the digital agenda’s core activities and make a roadmap that defines timelines and resourcing for the work.
Finally, making an impact with digital is also very much a HOW issue. If companies want to fulfill their digital visions and succeed in their digital core activities, they need to have certain set of enablers in place:
To summarize the “why”, “what” and “how” above: a proper digital agenda is comprehensive and it typically combines business, design, technology and data. It links with the overall business objectives of the company to ensure business relevance. It sets a clear direction for activities, inspires and sparks people to take action and engages real professionals from inside and outside the company. A proper digital agenda pivots the company towards it customers, helps better understand their needs and delivers customer benefits as well as improved customer experiences. A company that fully embraces digital also typically cherishes data, insights and measurability in everything that is done.
A proper digital agenda describes an inspiring journey that the company is about to take, something that touches the hearts and minds of the customers, employees, managers, partners and the society around the firm. It sounds very ambitious, but companies should not be satisfied with anything less.
Business leaders should not accept a digital agenda if it isn’t
Needless to say, the various items in the digital agenda include massive amounts of details that need special attention. And in the art of doing the right things the right way, the devil really is in the details.
The areas discussed above are all rich veins we can mine for future blog posts, so stay tuned. And if you meet with any Futuriceans at events or fairs, feel free to stop them and ask for tips and advice – we are happy to help you!
Want to hear more about how Futurice can help you to improve and execute your digital agenda? Please contact me at Futurice Advisory.