Putting ‘digital’ in perspective


This article was originally published on Forbes India Blogs and has been lightly edited

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This year, the number of smartphones, tablets and connected devices is expected to cross 7 billion – that will mean more connected devices than there are human beings on earth. With more and more people owning smart gadgets, these devices are going to have an increasingly bigger influence on our communication patterns, online habits and of course, our buying habits, and globally, organisations are trying hard to keep up with this shift by leveraging Digital Business Technology themselves.

‘Digital’ is also becoming a potent leverage point for businesses to transform the way they approach their markets.

Consider what Tesco did in Korea around four years ago. In 2011, Tesco’s affiliate, Homeplus in South Korea, had to deal with a strange situation in order to meet its aspiration of market leadership: While it was a problem that Homeplus did not have enough stores as its main competitor did, the real problem though seemed to be the very lifestyle of their potential customers – given that Koreans were extremely hardworking, they just didn’t have enough time to go shopping. So even if Homeplus was to set up enough stores, it was going to be a challenge to get people to visit the store.

While Homeplus was looking at its options, they were aware that the Korean smartphone subscriber market had exploded in the recent few years – the subscriber base had gone past the 10 million mark. This had caused a significant shift in consumer behaviour: young Koreans were relying more and more on smartphones to deal with several of their personal transactions that they could handle on-the-go in the midst of their daily activities or as they commuted to and from work.

The killer plan Homeplus came up with was to set up virtual grocery stores in strategic locations like subways and metro stations – they erected posters of products and groceries just like they were displayed at their stores – each item displayed in the poster came with a QR Code that provided product details such as pricing, etc, and could be scanned from an app on a smartphone into a virtual shopping cart. What’s more, the delivery of their checked-out items could be timed conveniently. Customers could now use their smartphones to buy grocery as they waited for their trains or whenever they found time as they commuted.

Opportunities within challenges
In overcoming their business challenge, Tesco Homeplus had found an opportunity to align better to shifts in consumer lifestyles and behaviour and had solved a genuine problem young Koreans were trying hard to deal with themselves.

Yet, what is most significant about Tesco’s story in Korea is that it demonstrates how digital initiatives can be more than just about keeping up with shifting consumer behaviour – they have the power to disrupt traditional customer engagement paradigms.

Such opportunities to rewrite well-established customer-engagement patterns are springing up in every geography, industry and market and as a natural result, world over, across industries and markets, enterprises are under an ever increasing pressure to meet such challenges – and, more importantly, one-upping (or avoiding being one-upped) by competition.

‘Digital’ initiatives involving social, mobility, analytics and cloud, have consequently become one of the most common themes in focus in enterprise strategy discussions across industries. Within the enterprise too, digital is fast becoming more and more relevant across many functions, including marketing, IT, business transformation and customer service.

However, beneath all this hype around digital and even as more and more firms take on digital initiatives, there is still confusion around what digital really is and what it takes to ensure its successful execution.

Digital initiatives today are designed to establish business differentiation and to better manage customer engagement and experience, workforce effectiveness, decision-making, market analysis and so on, none of which has traditionally been so directly influenced by conventional technology implementation.

Cracking the digital code
Digital means different things to different enterprises and to different enterprise departmental functions. As with any business technology initiative, success from rolling out digital initiatives depends on not only success from technology implementation but also how enterprises are able to interpret and leverage what digital really means to their specific business.

We understand digital is about social, mobile, analytics, cloud and so on, but what is digital, really?

There are enough definitions out there, but perhaps the best bet you will have from digital is not as much as understanding what it is, but really from understanding what it is not. The traditional role IT has played in enterprises and the way the IT function has evolved in the enterprise makes it easy to overlook some fundamentals on which digital success depends on. Many firms make the mistake of overlooking these, thereby seriously compromising the success of their digital initiatives. Here is a short list of what digital is not, which will hopefully give you the right levers to make decisions on ‘digital initiatives’ and ‘digital transformation’ and in taking the right perspective to make your next strategy meeting more productive.

It is not entirely about YOU
As you set out to lay the foundations for a digital initiative, one of the most important aspects on which your success hinges on is in keeping a steady, consistent focus on the very purpose of it all – that of aligning better to the customer and the market. Many firms make the mistake of limiting initiatives to fancy user screens or creating great mobile apps – and not going any further. Nothing could be more damaging than a snazzy interface that inevitably leads to clunky customer support and poor customer engagement.

While you need to manage operational costs and internal efficiency, customer-facing digital initiatives are best delivered by putting the customer expectation, experience and engagement at the core. Be sure to meticulously map customer journeys and be prepared to rejig internal processes to better align your internal forces to make those journeys short, efficient and delightful.

It is not about doing different things
It is really about doing things differently. It is about re-imagining your business in the light of changing consumer behaviour and expectation.

Smartphones, tablets and other devices are enabling us to always be online and connected and are changing us. RadioShack is probably the best example of a market leader that wrote its own downfall by ignoring changing markets and changing customer buying behaviour. No matter what your business is, it is very likely that you will be impacted by these changes. Your digital strategy and initiatives have to eventually help you deal with these changes holistically. You need to enable the mechanism to adapt and to re-imagine your business to survive. Slapping on new technology over old processes designed for old methods of customer interaction and behaviour will be a sure way to fail.

It is not about the technology
Among the most important things to come to terms with first is that digital is not just entirely about technology. It really is more about how you enable your firm to adapt to the dramatic technology-led changes happening around us. Be sure that the teams involved carry the same objectives and everyone views digital initiatives as enablers that allow your organisation to adapt and take advantage of new technology paradigms.

One of the most critical success factors for digital initiatives is for business and IT to be efficiently aligned. These initiatives call for a culture of transparency and communication needs to be open. To achieve this, be sure there is consistent top-management buy-in and ensure you put the right leader on the driving seat.

It is not a project
Many failures of business technology initiatives can be attributed to treating them as disparate IT projects. Your digital initiatives face the same threat. So when you think about digital initiatives, be sure the right objectives are firmly set at the very beginning. Create success criteria for execution teams that go beyond conventional IT project management considerations (like timely delivery) that are measured on specific tangible impact to business. Again, business and IT alignment will play a crucial role.

It is not a one-time initiative
Digital is a journey. It is a hat that your firm will now wear forever. While a true digital initiative may have delivery milestones, you are never really ‘done’ with it. Ensure that there is a strategy and plan for continuous monitoring and improvement, to continuously adapt. Digital is also not one-off from the sense of being siloed from other initiatives that are planned or are currently underway. All your digital initiatives need to add up to a bigger meaning.

It is not about dumping old technology
Digital is not about shedding old technology and bringing in new age apps. It is really about exploiting investments that have already gone into your technology infrastructure and aligning them smartly for the new age of technology.

This is part of a series of posts addressing critical aspects that make Business Technology initiatives successful. The series will cover topics relating to Digital transformation, Business Process Management, Customer Service, Change, Culture, etc.

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