“Many of us play rock and roll, but very few of us are rock and roll.” So said Dave Grohl, of Foo Fighters and Nirvana fame, in a tribute to the late Lemmy Kilmister of heavy metal group Motörhead at February’s Grammy Awards. A similar statement could be made about entities like Uber, Spotify, Waze, and others. They’ve turned established industries on their heads, and the companies threatened might well be hearing, “Many of us do digital, but very few of us are digital.”
Too true. Growing into digital maturity—from doing to being—is a process of evolution accompanied by experiments and failures. It might start at the edges of the organization, but it ultimately redefines the enterprise to build customer loyalty and trust that lead to higher revenues, better reputation, and higher employee satisfaction.
Hey, I’ve done digital!
Some organizations have set out to transform themselves piecemeal, and have come away wondering why the markets didn’t respond. But customers instinctively recognize that a few mobile apps, or a series of tweets from a CEO (or, more likely, a marketing intern), or zip-code targeted ads do not a digital brand make.
Savvy business leaders would be remiss if they didn’t seek to avoid leaving their organization in the dust of disruptive newcomers. Surely, they’ll be motivated by McKinsey’s research indicating that when approached holistically, digital transformation can boost the bottom line by more than 50%.
Doing digital by focusing on isolated initiatives won’t cut it. Businesses need to heed the call to be digital to the core, with a mindset that considers how it can and should pervade corporate strategy, the operational and business models, business processes, and the culture itself. This is what a truly digital operating model means: a reconsideration of every way in which a business touches customers and runs its business, with a particular focus on improvements that favorably alter how customers experience the brand.
At a digital business, contextually-relevant, hyper-personalized experiences are paramount. Think of a cable provider or airline that provides a great new digital device or mobile application, but turns right back into an old-school business the minute a billing question arises or a bag is lost.
It should not matter which part of the journey a customer is on: digital streamlines, simplifies, and enhances their experience. It also offers to reduce or eliminate the types of human errors that bedevil customers and damage brands.
Building a digital operation from the ground up is an opportunity only for the few. Most leaders in established enterprises don’t have the freedom to fundamentally alter and radically evolve the business without considering the current IT architecture, legacy processes, existing corporate change workflows, and the complexity of prevailing processes, attitudes, and behavior.
But even the most traditional ones can shake free from entrenched structures and seemingly inviolable processes and mindsets if they come to an understanding internally that helps them move toward full digital enablement. Elements of that understanding will include the following precepts for:
- Digital initiatives are programs that require not just technology change but corresponding changes to processes and operating models.
- These initiatives should be approached from a cross-functional view, from end-to-end of the value chain, to assess how they redefine customer experience and the organization itself.
- Incubation centers and “centers of excellence” can help promote a culture of innovation, fostering ideas and experimentation, thus to earn executive support for non-traditional funding and business case development.
- These endeavors require a centralized effort. While a focused organizational unit such as an incubator can develop, prototype and test ideas, only C-suite commitment to a pervasive transformation can drive a digital agenda in collaboration with all functions.
- Be a listener? Yes. By all means track and analyze customer journeys, interactions, and experiences. But drive change based on conviction about internally developed ideas as well. Use customer input to evolve, but use it to challenge, test and improve innovation and renovation.
- Employees should be acculturated to appreciate their customers’ points-of- view and be able to make decisions in-the-moment to improve customer engagement.
- Initiatives are not run-of-the-mill projects but require new thinking around implementation and ROI analysis, ones outside the usual framework of annual budget cycles.
Companies intent on being digital must exhibit leadership behavior that encourages difficult questions, empowers its people to challenge received thinking and industry shibboleths, and sees beyond boundaries both across and outside the organization. The shift to a digital operating model requires understanding, engagement, and commitment at the senior leadership levels, along with the strategic programs, a change management structure, and the operational reset that would logically accompany any other enterprise-wide transformation.
What makes your organization digital at its core? Let me know and check out our complete article.
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