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Creating The Digital Enterprise

Creating The Digital Enterprise: how to outperform?

Once upon a time, a well in-place company, one of these major, most fortunate worldwide companies. This enterprise noticed the existence of a real small competitor … something called a startup. The big company didn’t care. Why should it? It sells a lot of products for decades; customers always come back, and it is clearly identified as the “leader.”  And this competitor had only one small, stuffed product. No risk!

At least in the beginning!  Quickly, the competitor was able to improve its processes, quality, and usability of its products, and rapidly tended to gaining market share. This small startup became a real predator.

Everybody remembered what happened to Kodak or Nokia (evolve or die). Therefore, the big company decided to react immediately and radically improve its performance. The decision was to use the same weapon: digitization. The transformation will be initiated.

 

According to TechTarget.com: “Digital transformation is the reinvention of an organization through the use of digital technology to improve the way it performs and serves its constituents.

REINVENTION - This is the word. Digital transformation, or digitization, is not a kind of “enterprise upgrade,”  wherein buying some new hardware or new software will magically boost the competitiveness and productivity. Therefore, two questions naturally arise … WHY? HOW?

 

WHY should we digitalize? Is this the key to succeeding? Maybe not. But to survive, surely. Because your customers are asking for more reactivity and intimacy. Because your employees are asking for more flexibility. Because you need more productivity.

 

HOW should we go down this road? Is there a cookbook?

There is already a lot of literature on this topic, but in 2011 George Westerman and Andrew McAfee from MIT and Didier Bonnet from Capgemini Consulting produced the report Digital Transformation: A Roadmap for Billion-Dollar Organizations, where they defined the building blocks for a digital transformation. These were grouped in 3 key pillars:

  1. Customer experiences
  2. Operational processes
  3. Business models

Even if every company differs in its organization and business vision, and even if we know that a given case is always difficult to reproduce somewhere else, there are some common patterns for a digital transformation process. They don’t provide a magic recipe, but more the tracks between the cracks.

 

Have a look outside …

Customers are a key factor for success. If they like the products, they will buy them (making money is usually the main objective of every company. Isn’t it?). To reach the highest satisfaction and adoption rates, you have to deliver an exceptional and complete customer experience. Today, good design, an aggressive marketing campaign, and a fair price are not sufficient anymore to attract and retain customers.

Efforts need to focus on:

  • A better customer understanding, through analytic-based segmentation and social/digital media usage. Understanding the geographic and market segments and analyzing the clients' behavior are not new trends. However, companies now have access to new tools and media for in-depth exploration. Big Data, Cloud computing, and cognition offer new opportunities: Sentiment Analysis services can scan the social networks to draw a real-time corporate brand, while Data Analytics and Data Visualization help transform all the collected data into relevant information.
  • Customer touch points, via omnichannel (all communication channels are available to the clients and inter-connected) and self-service offerings. Cloud and responsive design help the company unify its communication platform and help the customers access desired services everywhere, every time, on every kind of device.
  • Top-line growth, with digitally-enhanced and streamlined processes between the enterprise and its customers. These ones now ask for customized and personalized offers. Bots can now help to automatize and provide 24h24 – 7d7 support, and machine learning can be used to generate better recommendations that are not only based on previous purchases.

Results from all these initiatives are more visible ones, maybe the most rewarding in terms of corporate branding. However, productivity is also the key, and this happens within the enterprise.

 

… Also, have a look inside:

Employees are as primordial as customers. Without employees, nothing happens, and, as customers, they would like having exceptional user experiences.

A 2015 survey from Deloitte Consulting highlighted that 91% agreed on the positive potential of digitization in their daily work. However, only 43% were satisfied with the current situation. Great improvements are achieved when transforming the internal processes with the following:

  • Processes Digitization Automation will help to remove repetitive and low-value tasks, thereby allowing people to refocus on strategic, more valuable tasks, providing higher quality and efficiency. Analytics and cognition, such as email analysis or HR management, can be used for improving the processes. On the IT side, a DevOps approach will help to reduce the time to market, with better quality.
  • Worker enablement, through collaborative platforms, Cloud, and smart workspaces The aims are faster communication and knowledge sharing but also flexibility in the way employees are working.
  • Performance management Decisions are now data-driven and transparent. With the support of big data tools, decisions are now made on real, up-to-date data, not on assumptions. Data visualization will help to extract deeper insights.

These are just the first steps. Ways the companies are doing business should also be digitalized, by adding or creating new opportunities:

  • Adding digital offers on top of existing products is a good way to extend this business and to attract new consumers for whom digital is everything (think about all whose will follow the millennials).
  • Extending the standard products catalog with complementary digital products will help to lead the market. Usually, this is where disruptive enterprises are coming, by providing this little small plus that pleases to customers.

 

Let’s take one criterion rating:

The digitization progress is evaluated through the digital maturity level, measured by the combined digital intensity and the transformation intensity.

Digital intensity measures the investment in initiatives triggered to change how the company operates.

Transformation management intensity measures the engagement of the leadership team to promote the digitization within the enterprise and their vision to build the future.

Even if the maturity differs from one company to others, those that are the more mature will always outperform those that are not.

 

The new digital company will be more connected, automated and analytical data driven. The technology is just the support and defines the possibilities. But the digital initiative is just the beginning and should never see as a one-shot project. It involves all aspects of the company and will force to evolve constantly. And as Ginni Rometty (chairman, president, and CEO of IBM Corp.) said, “… digital is not the destination. Rather it is laying for a much more profound transformation to come”.

 

Pierre Schuffenecker - Practice leader Digital, mobile & IoT for the German speaking part

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  • Pierre Schuffenecker
    Pierre Schuffenecker
    Practice Leader Digital, Mobile & IoT for the German Speaking Part
    +41 (0) 76 811 11 92
  • Luis Marcos
    Luis Marcos
    Practice Leader Digital, Mobile & IoT for the French Speaking Part
    +41 (0) 79 653 69 02