According to a Forbes survey, 90 per cent of global businesses have already started their digital transformation journey. In truth, digital transformation goes beyond improving software or technologies, it should be viewed as a platform that can transform the customer experience, operational processes, and improve business models. Whether it's a full scale legacy system overhaul, or simply moving to social media channels to better engage with audiences, companies don't have the luxury of time on their side to pursue digital transformation as late adopters.
We recently hosted a panel discussion with the Toronto Region Board of Trade about the economics of digital disruption that featured a great group of industry leaders including CIBC, Rogers Media, Microsoft, and Architech. The panel provided incredible insight into the shifting tides their respective industries are facing and the degree to which digital transformation has been prioritized. The most consistent insight that was echoed across the panel was that it all begins and ends with the customer experience. If you don't start the journey with the customer, or with the employee, then the digital transformation won't succeed and the economics behind it begin to fail.
The Now Economy
For consumers juggling the responsibilities of work, family, and personal life, one of the most precious resources is time. And businesses must ensure that they are spending their consumers' time wisely. With current digital developments, consumers benefit from saving time in their purchase journey at a cumulative 40 billion hours, globally.
Companies have already started to adapt to customers' time-starved lives by providing access to services around the clock. Banks, for one, have made it easier and more convenient for their customers to use their services: customers can deposit cheques using a mobile device, and are also able to complete their banking whether between meetings at work or while vacationing abroad. "We live in a now economy and we must look into providing the right customer service across various touch points to the end user," says Fatema Pirone, Senior Director, Enterprise Innovation, CIBC.
Fail in a Hurry
"Fail in a hurry, build the minimum viable product as quickly as you can, pivot as soon as you find problems, learn what you can, and then re-invent yourself," says Tal Bevan, Chief Operating Officer, Architech. According to Bevan, using Eric Ries' Lean Startup method and mentality, organizations should validate the product with their end-users before getting past a point of no return that spells disaster for the company. One of the goals for organizations undergoing digital transformation is understanding the end-user and streamlining the process before bringing a new idea, process, or product to stakeholders. Without understanding the customer, and the need, there is a limited runway for success.
Balancing Legacy with Cutting-Edge Innovations
The Internet of Things, data, advanced analytics, cloud computing, automation, and blockchain, to name a few of the latest innovations, are already infiltrating industries and changing the very nature of how businesses operate.
"We've lost the economy of scale," says Steve Maich, Senior Vice President, Digital Content and Media, Rogers Media. "We made the decision that our future was in digital. We realized that we could not ask people to constantly split their focus - loading more and more work on a static workforce. We know their focus needs to be [in digital], consumers are telling us that every day, and if we want to succeed, we need 100 per cent of our focus on the digital side of our business."
The Devil is in the details
A big part of the journey will continue to be data and understanding what the numbers are saying. According to IBM, there are "around 2.5 quintillion bytes of data created every single day" and consumers are one of the most significant contributors to the amount of data. While the data presents real potential for changing business models and understanding the customer, 'big data' isn't usually black and white. Why? Because companies have been capturing data without any real purpose behind it, and the truth is that the data needs to be predictive in order to have a real impact. Without predictive data, it's really just a bunch of numbers that aren't going to teach you about or help you shape your business. Companies that capture the right data and analyze it correctly will continue to find significant opportunities to leverage it to improve back-end operations, improve services, personalize marketing efforts, and offer new services.
Change is Hard
Done right, digital transformation will streamline a business' value chain, making it more agile, scalable, reliable, and efficient. The challenge for many companies undergoing digital transformation will be ensuring buy-in from all stakeholders and clear communication at all levels. "Change is hard. Change is scary. But the thing that people fear the most is the unknown," says Maich. Considering the current pace of innovation, digital transformation within an organization can be the catalyst for broader business change and stronger financial performance. It is also changing the face of the economy faster than ever before.