The Digital Transformation Series – Part 4 – Shaping a digital strategy

A transcript of a video, part 4 of 6, from the Digital Transformation series, produced in partnership with the Business Transformation Network. Video here: https://www.thebtn.tv/exclusive-content/video/technology-led-disruption-chris-micklethwaite

[TRANSCRIPT]

Introduction

Hello I’m Chris Micklethwaite, I’m founder and principal consultant at 3pointsDIGITAL. I’ve spent my career in technology, working with web and customer-facing technologies, and using technology to help find efficiencies in business, and that help people collaborate and work better together.

What I’ve learnt from the businesses I’ve worked with is that technology alone can’t make a change in an organisation; to use technology effectively to help people to become more productive, and for an organisation to better connect with the customer requires fundamental changes in people, skills, structure, approach and culture. I founded 3pointsDIGITAL to help businesses of all types tackle these challenges, and the challenges and opportunities from balancing three points of a triangle: Customer, Business and Technology.

In this series of videos we will to explore this type of technology and the permanent changes required in an organisation to adopt, use and generate benefit from it, which in short is called digital transformation.

We’re going to talk about digital disruption, what characterises digital native businesses and what we can learn from them, and how to create a digital strategy and embed change in your business.

How do you approach creating a digital strategy?

At 3pointsDigital, we have an approach that first looks at the external forces the organisation is operating in. Many of our clients have either already been disrupted, are feeling competitive pressure, or can see an opportunity in digital and are unsure how to take advantage. These external forces can be everything from the competitive threat and where it’s coming from, new business models changing the industry including disruption from new platform business models. We look if there intermediation or disintermediation happening, at the organisation’s positioning, and emerging trends. Crucially though, we also look at changing customer and consumer behaviours, and how they are relevant to the business.

So for example in the B2B environment (where a customer is really a just consumer spending someone else’s money) they will almost certainly have certain expectations about how they want to place an order, how they want to procure, how they want to compare prices and specifications. Their expectations are driven by the likes of Amazon, from their own personal use of mobile and web over years, and all of those expectations need to be met somehow.

Quite often we do a customer journey map so we can understand customers wants and needs, and establish where as a business you’re currently failing to meet them. Then we overlay the technology opportunities – looking at the technology that’s available – whether large platforms, smaller open source frameworks or emerging technologies that you may want to take advantage of. Machine Learning and AI are two obvious examples that are finding very real applications in modern business. We overlay those onto how we might use them meet customer expectations and customer needs and wants.

So those are the external forces – Industry disruption, customer expectation and technology opportunity.

Then we look internally at a whole range of things; capability, how the organisation is structured, how siloed is it, how easy is it for different disciplines to work together, what’s the level of customer focus and what customer data and feedback exists, and is that being used to change how the business operates. We look at culture, the broad understanding of digital, the technology capabilities, the skills in the teams (very important) against the current technology landscape.

The big challenges for most incumbent/traditional businesses is technology legacy, and how to work with systems that are very difficult, very slow to change, and perhaps over customised in many respects, and also businesses that are operating in that model of business to IT (versus IT delivering to the customer) [as discussed in Part 3].

So really the focus is on assessing how mature those capabilities and aspects are, both in technology and people and the delivery approach. Ultimately this gives us a reading of the potential change load for the organisation. Then we can start to think about what transformation really means for the business.

How do you embed a digital strategy?

So once we have understood all of the forces and factors, changing industry landscape, and market forces. And once we understand the areas of capability and approach internally, and ability for that organisation to change, we focus in and prioritise areas where change needs to happen first.

But there is one thing for sure; digital transformation is not going to happen unless it’s driven from the board down. So regardless of the level of technology understanding at the board, at the very least you need an appreciation of digital and the opportunity of digital, both from the cost and efficiency point of view (perhaps the benefits of collaboration internally) through to better engagement with customers… At least an understanding and appreciation of the benefits of that to the organisation – and the fact that – most importantly – this will be a long-term strategic investment.

So having that understanding is the only way to embed change, and to get your transformation off on the right foot. That understanding and appreciation needs to be across the entire C-level, otherwise it’s got a very low chance of succeeding.