Every business can be a digital business. B2B service providers, B2C product sellers, construction, real estate, media, telco, sports, tourism, hospo, legal, accounting, grocery, utilities… it doesn’t matter who you work with, sell to, what you produce, where you live, where your customers live…. None. Of. That. Matters.
Every business can be a digital business. In fact, scratch that. Every business MUST be a digital business. We’ve talked many times before why. And as the impact of technology accelerates, so the impact on business accelerates.
We’ve covered several transformation themes over the last few weeks – the rise of the CMO, digital transformation, and then transformation structures. This week I want to bring these together, blending the learnings to paint a picture of the requirements for building a digital business.
There are three clear boxes any company serious about digital transformation needs to tick:
- A consistent and company-wide commitment to transformation. It’s not enough to quietly build this as a strategy. You need to broadcast it, making sure all your employees understand your drive, and are clear on your aims.
- Establish an environment supporting of experimentation.
- Have great top down leadership committed to transformation.
And a leader committed to transformation looks a little like this (take note this is you):
- They are able to manage across multiple departments, bringing each with them on the journey.
- They create and then foster a dynamic and strong network of innovators .
- This one is gold… they translate complex to simple, engaging stakeholders regardless of expertise .
- Finally… they are adaptable, flexible, and capable of change themselves.
The ability to mobilise a company-wide commitment to change is vital, initially through a clear statement of intent, and then through the actions and deliveries of innovators. I read this report a while ago from API business Apigee. It’s a couple of years old, but I think the headlines still hold true. As an aside… Apigee has just been they’ve just been bought by Google.. so they must be doing something right!
Another thing we’ve talked about in the past is exponential change, powered by the 6Ds (digitisation, deception, disruption, demonetisation, dematerialisation, and democratisation) Companies leading the digital market are riding the exponential wave, dramatically outperforming legacy or linear businesses.
1-They create conditions for transformation and grasp opportunity before competitors start to move. In a recent piece of Accenture research it isn’t surprising to find they also share a number of characteristics.
2- They are comfortable shifting priorities and investment away from existing (revenue generating) digital processes, understanding change is a given. This helps them stay consistently ahead of their competitors.
3- They are investing more heavily in long term digitally focused roles, with a higher proportion planning to add resource in digital marketing and strategy.
4- They are more willing to use external resource to plug internal gaps. 40% of market leaders use external resource to deliver 50% or more of their digital work.
5- CMOs are leading their transformation. 33% have CMOs leading the digital organisation, with CDOs (15%) the next highest.
6- 39% have had their digital organisations in place for five years… with 25% having a digital organisation for over five years.
7- Most do not have a fully integrated digital model. Digital departments are by far the most common model.
8- And finally, market leaders tend to focus on topline digital revenue first, way ahead of governance and control (or bottom line process improvements). This is in stark contrast to legacy businesses, who tend to see digital as an opportunity to create process and bottom line efficiency. Unsurprisingly, revenue is the dominant KPI for market leading digital companies.
If you intend to be a market leader and create effective digital transformation in your organisation, it is no longer acceptable or effective to muddle through.
Exponential technologies are rendering that approach obsolete. You need to build capability and expertise fast, even if it starts siloed in digital teams – getting started is better than waiting for the golden moment.
And remember, the change needs to start at the top – if that’s you (as COM, CDO, or CIO) the onus is on you to grab the bull by the horns and move now, before it’s too late.