This might be common sense but the number of times I’ve had discussions with small to large sized legacy companies that don’t understand what Digital Strategy really means for their business is astounding.
- Digital Strategy is not a flashy new app.
- Digital Strategy is not a report that rolls up in your email every morning.
- Digital Strategy is not having CRM.
- Digital Strategy is not having a flashy website.
- Digital Strategy is not cutting costs & creating efficiencies.
- Digital Strategy is not introducing a new product line.
- Digital Strategy is not implementation of SAP ERP.
- Digital Strategy is not even nailing Industry 4.0 transformation.
Digital Strategy is breaking existing business model into pieces and examining processes, components, segments and reapplying, and reassembling a coherent model that is optimised with long-term, big picture in mind.
This is the scariest proposition for business owners. Many fail by raining in results and controlling outcome. End results are usually wishy washy incremental improvements.
You should be trying to get ready for industry to be disrupted, and get ahead of the curve.
Innovation required to develop a Digital Strategy can not be sold as a turn-key solution.
Larger the company, harder it is to break the mold.
I’ve advocated and predicted in past that Wal-Mart must setup a separate “start-up” team, in order to come up with anything remotely useful in order to stay relevant. To be able to compete with Amazon it was the only logical “not so scary” solution.
Wal-Mart has made improvements using their “startup” in Silicon Valley, as have many other large companies. Tapping into innovation. However, it did not make gains that allowed input from “startup” to change it’s core. They controlled the “startup” using their core instead. Don’t get me wrong, these are are good ventures for incremental, value-added solutions, but these are not game changers.
Competitive advantage does not come from just being better or cheaper anymore. With heavy commoditization of goods and services, you are always fighting for margins. Some companies are simply just happy having positive EBT… until industry changes. By then it’s usually too late.
Imagine swimming in a middle of an ocean, fighting to keep head above water. Desperate times will make you reach and hope you grab a life vest, raft, a piece of rubble to help you along. Having positive EBT might thrill the stockholders, but it will not put anyone on the road to success. Having Digital Strategy, evolving it over years and letting it affect your business core – becoming agile, this is the mother battleship coming to save you. Digital Strategy will ensure your company is able to weather any disruption and be the one that sets trends and makes the rules.
You must build a business model that will allow you to leverage competencies, and expand into areas that will allow you to support your competencies.
I keep going back to Amazon – Business model was made not to compete with Walmart, or be marginally better, faster, cheaper. They used their core strength and expanded from Books into Electronics, into Marketplace, into Infrastructure (AWS), into Video on Demand, into Studio Development of Original Content, into Ad Network, etc… These industries support each other and give Amazon great competitive advantage in each industry.
This is why BestBuy will not only turn into a showroom company where nothing is sold. BestBuy will make profit by showcasing products from manufacturers. Their whole business model will change. They might even partner with Amazon to give it brick and mortar presence, as well as provide outsourced logistic services.
Amazon expanded into industries that would support each other, becoming good at more than one thing, opening doors for new and emerging industries, stepping in to fill those needs, continuously gaining competitive advantage.
In very traditional industry lines are drawn across product lines, lines are drawn between departments, lines are drawn between customer segments, and so on… focus is 10ft away, not further. This indicates the lack of Digital Strategy and leadership perspective.
Government protectionism and tariff wars are brewing globally and this is not a solution anyone will benefit from. It might delay industry disruptions, but it will not protect companies, consumers or jobs.
Freedom Mobile/Wind Mobile is likely to overtake Bell, Telus and Rogers in coming years disrupting telco industry in Canada. New players will arrive too if government does not clamp down on competition in Canada. Where monopolised infrastructure used to be a huge barrier to entry, someone started to tear at it, one step at the time. Rogers and Bell will likely continue to do everything possible to protect their investments, as they did with Television. But for Rogers and Bell that battle might already be lost unless they change the business model in a extraordinary way.
Having a clear vision and focus on revolutionary changes is the answer.
Facebook will implement digital currency (Libra) over next few years that will also change the world as we know today by integrating it within it’s social platform. This is best example of global game changer. Others will follow. Opposition from governments across the world will likely be something to hold it back for a few decades to come, but it will become a truly global economy within our lifetimes.
To drive Digital Transformation in your company, you must dedicate yourself to building support with peers and the board. For ideas to be adopted, sometimes you have to approach people delicately with caution and find their needs and wants, and fill them. Demonstrate with kindness, don’t direct with fear. You must build a following of innovative culture, by having patience, making drafts, demos, prototypes, selling it – and you will be rewarded with an amazing army of Missionaries – not Mercenaries. Ecosystem of Innovation, if not blocked will reach critical mass moving faster and faster – making you the next industry leader.
Setup teams outside of core business. Make a “startup” or invest into “startups” that align. Invest and reward true talent. Let it affect your core business in profound ways. Don’t fear it – embrace it head on.
Building and supporting Digital Strategy in multiple industries was one single, longest and greatest endeavour of my lifetime, and I enjoyed every second of it.
This is a brief overview, and it is not intended as full scope of Digital Strategy approach. These are my words of encouragement. If you’d like to find out more, feel free to contact me at nash@stamenkovic.me
Example of work I’ve done over last +20 years towards Digital Strategy & Transformation:
Customer Intelligence
- CRM implementation enabling Multichannel analysis.
- Web analytics, and Funnel analysis.
- Transactional Data customer activity.
- Multichannel behavior analysis.
- COT/RMA/Feedback – Customer Service Excellence Metric Reports.
- Competitor Analysis & Competitive Intelligence.
Marketing and Customer-Focused Efforts
- Persona, user-centered design and marketing focus.
- Web/Content Management/A/B data centric testing, SEO
- Stakeholder & User Interviews, review & roadmaps.
- Online Media Project Manager.
- Social Networking Project Manager & Champion.
- Pushing strong use of KPI metrics within Marketing campaigns.
Sales and Service Optimization
- Implementation of E-Commerce Solutions B2B/B2C.
- Implementation of EDI communications B2B.
- Enabling 100% Mobile Front Office Workforce.
- AI Metrics, Reporting and KPI oversight.
Enterprise Technology Architecture and Processes
- Lean + Technology Driven/Enhanced processes.
- Banking Electronic Transactions.
- Fully Mobile Logistics + Virtual Warehouse tracking, picking.
- Infrastructure Maintenance & Scalability – (send it all into Cloud).
Collaboration
- Transforming local into of Global workforce.
- Global collaboration with expert subject matter leaders.
- Implementation of Collaboration Tools.
- Sharing Globally Marketing Materials/Assets campaigns & results.
- Changing B2B market into collaborative warehouse & joint distribution model.
New Product / Market Exploration
- Development of hybrid B2B + B2C + Third party distribution model.
- Seamless Integration Third-Party Logistics.
- Introducing new Licensing model and repackaging of SaaS software for retail/on-premise (+1B market).
- Improving encryption strength and efficiency, Military/Government Markets. (+1B market).
- Self-Serve Web Hosting Application provisioning systems & Billing.
Innovation and Governance
- Digital Strategy roadmap for Board of Directors – one small step at the time.
- Advocate and enabler of move towards Industry 4.0/5.0
- Digital Strategy roadmap and lead Project Manager on all related projects.
- Orchestrating, balancing and prioritizing innovation activities across divisions.
- Focused on High-level, Technology subject matter leader, supporting cross-functional innovation steering group/board, as well as ultimate innovation champion supporting industry disruptive business models.
Great overview Nash! I love your optimism and enthusiasm!
I can tell you are passionate about this. We will talk…