Will your business survive the digital apocalypse?
Overview of digital transformation expectations
Read time: 4 minutes
Unless you successfully manage the digital transformation, your company may not exist in 10 years.
According to outgoing Cisco CEO John Chambers, 40 percent of businesses will be gone in a decade because they were unable to make the transition to digital. Of the 70 percent that try to go digital, he continues, only 30 percent¹ will succeed.
At least, that’s what he told 25,000 executives at a recent conference.
“If I’m not making you sweat, I should be,” he added.
Most businesses want to thrive in the digital world, and many think that by setting a mobile strategy and hiring a few workers with digital expertise, they’ve got the transition covered.
Not so, experts say. So what can your business do to survive?
Think digital all the way
Digital transformation touches every function of every business unit. Achieving success means starting at the top, with an overall vision that top executives take seriously and work hard to implement. Once a strategy is set, everyone at the company needs to understand the company’s digital goals and their part in making them a reality.
Put the customer experience first
Customer experience is at the heart of digital transformation. Becoming a truly digital company means using technology to focus on your customers with laser-like precision.
Successful digital companies are no longer merely customer-centered, but are instead, as Amazon calls it, “customer-obsessed.”[²]
You should document the journey for both off-line and online customers. Then create an ideal journey for each channel based on your research and knowledge of customers. What technologies do you need to make the ideal journeys a reality?
Even if your business exists in the physical world and doesn’t depend on digital sales, you need to remember that your customers spend a good portion of their lives online. If you don’t become a part of it, you will eventually lose them.
What can you do?
Be imaginative. Open yourself to possibilities. And maybe follow the example of professional football.
In 2012, the Seattle Seahawks created a mobile app for fans that provides NFL scores, news, team player statistics and tie-ins to social media and a place to buy tickets. Many teams now have similar apps. This is information that fans (customers) could already access in other places. But instead of thinking, “They already have that,” the team stepped into the digital arena to become a one-stop-shop for football information and sales.
Take a risk
Netflix is an example of a business that took risks to go digital — and the transition wasn’t easy. The company had a successful business mailing its customers DVDs, but chose to leap into the future with digital video streaming. Setting up streaming video was expensive, and when the company created a dual business model and raised prices, it lost 800,000 customers and got a ton of negative publicity.³
But the forward-looking strategy paid off. Today, Netflix is valued higher than CBS and Viacom.⁴
Establish a vision and follow up
So how do you go about creating and executing a successful digital strategy? Take a holistic view of your organization and consider consulting with a partner.
First, create a vision based on factors that are disrupting your market, an Altimeter Group study⁵ suggests. Do a digital SWOT analysis to zero in on what you need to change in an increasingly digital environment. Then, show your company you are serious and put an executive or a board member in charge of this effort. Make sure there is accountability at the top, and create a digital transformation team that works with IT to examine data and set priorities.
And, of course, follow through. Top-notch digital companies do deep data analysis that extends beyond normal IT capabilities. You may want to consider hiring a data scientist if it’s in your budget (and if you can find one). A lack of data analysis skills is the biggest barrier to companies’ use of big data, a Harvard Business Review study found.³
Make sure your business is prepared
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- ¹ Julie Bort. "Retiring Cisco CEO delivers dire prediction: 40% of companies will be dead in 10 years" Business Insider. June 8, 2015. http://www.businessinsider.com/chambers-40-of-companies-are-dying-2015-62
- ² Amazonjobs.com. https://www.amazon.jobs/principles3
- ³ "The Digital Transformation of Business" Harvard Business Review. 2015. https://hbr.org/resources/pdfs/comm/microsoft/the\_digital\_transformation\_of\_business.pdf4
- ⁴ David Lieberman. "Is Netflix Worth More than CBS? Wall Street Says it is After Strong Q1 Report" Deadline.com. April 16, 2015. http://deadline.com/2015/04/netflix-worth-more-than-cbs-stock-price-1201411029/5
- ⁵ Vala Afshar. "The 2016 State of Digital Transformation" Huffingtonpost.com. September 20, 2016. http://www.huffingtonpost.com/vala-afshar/the-2016-state-of-digital\_b\_12074114.html