Every organization is adopting digitalization, albeit at different paces and with different results, but adopting digital is not optional for organizations; it’s compulsory—just as adopting the Internet 18 years ago was not an option, so recognizing this, the question many leaders are now asking is, 'How to go digital?'.
Earlier this year Bridges Business Consultancy Int and PerformanceWorks collaborated to research the State of Digital1 across North Americas, Europe and Asia Pacific, by interviewing over 1,800 leaders. The surprising and concerning findings were covered in our previous article, “The State of Digital in 2019”. In this article we shift our focus to answer how you can adopt digitalization into your organization.
The first important message is that, it’s not about having a digital strategy but a strategy in a digital world.
Leaders can often become overwhelmed in the challenge of adopting digitalization as they identify all the new technologies maturing simultaneously, such as Machine Learning, AI, IoT, Big Data etc. It can be difficult to try to understand how digitalization will impact their business.
The initial challenge is to understand the role digitalization plays in the overall organization strategy. We have observed leaders go through three phases in this journey to digital maturity:
- Awareness – coming to terms with the different technologies and their uses
- Adopting – discovering the impact digitalization on the business and experimenting
- Aggressive – leveraging digitalization as a strategic tool and creating new revenue opportunities
Many leaders are currently hovering between phase one and two and this leaves them searching for guidance and a framework. A perspective currently gaining momentum, is that we are not a bank, or a shipping company, or a retailer, we are a tech company providing our service. This perspective encapsulates the desire to be technology driven.
The other currently frequently heard perspective is that digitalization is not about the technology but about the technology and people. As with any implementation, it’s the people in the organization who implement strategy. The challenge for leaders is to provide the guidance, skills, resources and support as their people implement. As part of our research we also discovered from organizations that had moved to phase three, that there are three strategic stages to digitalize an organization and support the people.
The first step for a leadership in “How to go Digital” is to identify their digital vision by thinking about tomorrow.
1/ Future Thinking: Establish a clear digital vision and develop a leadership growth and digital mindset.
Leaders need to identify how digitalization adds value to their business and their own role in the execution. We were working with one banking client, for example, who shared their digital vision was to take account opening online. Compare this to another banking client we work with, DBS Bank, whose digital vision is to “Make Banking Joyful”. The first is too limited and narrow, whereas the second was truly a guiding light, (our next article is a case study on the DBS Bank transformation).
Your digital vision has to follow the same rigor and discipline from previous visioning exercises and be truly inspirational, exciting and guiding. At the same time leaders need to recognize how digitalization changes the way the business operates and how they lead the business. One leader briefed her team about the new digital vision and then the next day asked for a report to be printed and distributed manually. The disconnect between words and actions can easily be the downfall of all god digitization efforts. Leaders need to digitally transform themselves before transforming the organization.
2/ Centricity around Customer, Culture and Operations: Identify the impact of digitalization on the essential components of the business.
Adopting digitalization fails more often than it succeeds and a key reason for this is that organizations habitually underestimate the impact on the business. Digitalization requires a whole business model transformation. It’s not about tweaking or adjusting the business model but a complete transformation, that starts with the customer.
Adopting tools such as agile, design thinking and customer journeys, the organization revisits its customer offer. This is leading many organizations to shift from selling products to selling platforms. Instead of pushing a product to the customer, they look at what customers truly want and build a platform around the customer needs. The platform includes multiple applications as well as links, using open APIs (Application Program Interface), to other organizations.
Consider how the smartphone started out as a product but now has multiple applications on it and how taxi apps now allow you to also order food, book theatre tickets and other services using open APIs. The platform has become the product for leading organizations such as Alibaba, Amazon, Haier and Ping Ann.
To move to a platform involves first truly understanding your customers (not just paying lip service to customer service) and then redesigning products and services with a digital mindset while simultaneously protecting your customers’ trust. To achieve digitalization you must be customer obsessed, have eliminated silos (as departments have to collaborate to offer platforms) and empowered your staff as digitalization starts with the digital vision but is executed from the ground upwards; which is why the right digital vision is critical.
Simultaneously the technology architecture must evolve to support the new business model. Many organizations are moving to cloud as they replace legacy systems and build new capabilities. If you are wondering why we did not lead of with technology, it is to emphasize that digitalization is as much about people and business model transformation as it is about technology.
3/ Future Proofing: Measure your digital strategy measurement while becoming data driven and building business sustainability.
The leadership team need to ensure continuality and sustainability. Transforming a whole business model transformation takes time, dedication across the whole organization and a discipline, that many organizations often lack. A new strategy requires new measures to track the execution and to take corrective action as required. Many of the measures required for digitalization are new to organizations and require leaders focus and attention to identify what to measure and how. For example, measuring the value of digital customers versus traditional customers.
A critical part of the digitalization is also building a data culture where the organizations shifts to using real time data and data visualization in meetings, to make decisions. This allowing them to react faster to market and customer changes and to have “zero distance” between themselves and their customers. This means that customer inputs are real time and driving the innovation. Organizations such as Infosys, T-Systems and Haier have adopted this thinking.
Organizations who are in the aggressive stage of the maturity model, for example, don’t allow slide deck presentations and have spent considerable time and effort on defining the right data, how to capture it, how to use it and how to protect it.
The three strategic stages make the core of our Ticking Clock model for digitalization. The outer circle highlights the requirements that are evolved into the 11-Steps Model (with each step outlined in the article) as shown below:
How to Go Digital Ticking Clock
If you are feeling overwhelmed about the challenge ahead then you are not alone, especially as our research also revealed that 84 per cent of digitalization fail. The journey is a treacherous one, filled with hurdles, potholes and land mines. If you would like support in digitalization, then please let us know. In the next article we expand on the 11-Steps of “How to go Digital” with a case study of how DBS Bank became the best bank in the world.
State of Digital 2019 download here
About the Authors:
Jeremy Blain & Robin Speculand, collaborate to offer organizations how to go digital. Based in Europe and Asia respectively, they also ruin their own business consultancies. Their shared passion for supporting organizations to adopt digitalization and their research, has led them to be known as the Ticking Clock Guys.
Jeremy is an award-winning business leader and human capital expert. He is CEO of Performance Works International, a professional consultancy that helps traditional organizations transform into dynamic businesses ready for the demands of the future. Over the past 20 years, Jeremy has supported businesses in most major markets in the world, helping leaders and teams drive a cultural shift that responds to the fast-changing digital era;
Robin is a recognized pioneer and expert in strategy/digital implementation. He is the founder and CEO of Bridges Business Consultancy Int, created the Implementation Hub - the world’s first online portal dedicated to strategy implementation and the Implementation Compass™. He is an international bestselling author who has sold more than 45,000 books worldwide and co-founder of the Strategy Implementation Institute.
This article first appeared at Tirian, a leading international organizational learning and development consulting company