by Mohamad El-Hinnawi, CustomerThink

Digital Transformation, Customer Experience, and Innovation!

Three emerging and intersecting disciplines that benefit and suffer at the same time from having scattered corporate initiatives rebranded and packaged under their names, irrespective if those initiatives serve the objectives of those transformation programs.

Are organizations doing such packaging to justify investments? Are they doing it to say that they are delivering on those emerging disciplines? Or do they really believe what they are doing will enable them to change and disrupt?

Well, I don’t have the answer.

However, I want to highlight some priorities that are building blocks of those disciplines, with a focus on digital transformation.

In their research report, “The 2016 State of Digital Transformation”, Brian Solis and Jaimy Szymanski define digital transformation as the realignment of, or new investment in technology, business models, and processes to drive new value for customers and employees to effectively compete in an ever-changing digital economy.

The definition simply clarifies how digital transformation can drive new value. But what are the priorities that need to be considered in order for this discipline NOT to be just another buzz word?

Digital leaders have a major role to play to change the misalignment that could take place in the above context. Before starting to execute, digital leaders should cover the following three priorities for their transformation programs to be successful:

1. Developing a clear “customer centric” digital strategy

“Strategy without action is a daydream. Action without strategy is a nightmare”.

As this Japanese proverb suggests, executing actions without a clear strategy would be a scary approach to follow. As such, a clear strategy needs to be put in place in order to execute digital transformation in an efficient manner. Several organizations are rather focused on the volume of executed initiatives and the technological advancement of those initiatives, without having a clear visibility of what would the impact of those initiatives be.

What if the end result is not what the customers really need?

What if you really exceeded your customers’ expectations with your digital capabilities, but they cannot afford it? Or they don’t need it!

Would you be wasting investments without creating real customer value?

Digital leaders should design strategies that aim at aligning their digital transformation programs with the needs and expectations of their customers. This requires understanding of the changing customer behaviors and needs in order to be able to set the vision, mission and tactics.

2. Developing a customer data collection strategy

The second priority that digital leaders should take into consideration is the development of a customer data collection strategy. As we can only connect the dots that we collect, it is very important to structure the data landscape to further understand the current state of data completeness and quality.

In their 2016 state of digital transformation research report, Solis and Szymanski found that 71% of respondents consider understanding behavior of impact of a new customer as “challenging” or “very challenging”. The number went up from 53% in 2014, despite more data being available about customers.

So, data is available, but is it collected or structured?

Digital leaders need to develop a clear blueprint to identify and collect the missing customer data. Identifying proactive data collection tactics through outbound channels and inbound customer interactions would assist in gathering the missing data and building a better data governance.
The availability of data enables further understanding of customers’ behavior and prediction of upcoming actions.

In addition, it helps evaluate the impact of the executed digital initiatives on the customer experience.
Unlocking the potential of data would give digital leaders more confidence when it comes to aligning the initiatives with the overall digital strategy and will help more informed decisions accordingly.

3. Building a digital center of excellence

Centralizing the efforts of all stakeholders that are involved in governing the strategy and executing the digital initiatives is also a priority. Centralization would break the organizational silos and bring diverse knowledge and expertise into one table with one goal.

Centers of excellence are often good platforms for this centralization.

Beyond the necessity of holding such platforms in physical environments that are more similar in nature to startup labs than to conventional corporate environments, stakeholders should be given the flexibility to operate under no organizational limitations such as hierarchy and key performance indicators.

They will then be able to put creativity into action and generate better and less complicated solutions to be experimented and validated. Functional owners will be tackling problems in an innovative and agile manner, as continuous production of viable ideas, solutions, as well as continuous experimentation is taking place.

Moreover, an essential outcome of centers of excellence should be experimenting emerging technologies. A simulation of the customer journey when it comes to new technologies is really important in order to assess the usability of those applications and the relevance to customer expectations.

The above three priorities are building blocks for a more holistic digital turnaround that would assist in driving new customer value.